This week news.Bitcoin.com spoke with Craig Sellars, cofounder, and CTO of Tether. The application is a service that allows users to convert fiat currency to cryptocurrency and anchors it with the choice of either the U.S. dollar, the Euro, and the Yen. He also works with many other “Bitcoin 2.0” technologies such as Omni, Factom, Synereo, and the Maidsafe foundation. Sellars gives our readers some insight into his universe filled with many crypto-related ideas and developments that revolve around an ongoing theme of decentralized technology and the building of an internet filled with magical things.
Bitcoin.com (BC): How did you discover digital currencies?
Craig Sellars (CS): In late 2010 I read on an obscure blog about someone attempting to put their life’s savings into a new form of digital currency that was run by no one. It was the kind of thing that should catch any libertarian CS nerd’s eye. I downloaded the first Mac build of the client, told it to mine, and practically immediately thereafter shut it down because my computer was about to melt. I bought my first bitcoins in the summer of 2011 and mused about splurging $4,500 for a 1,000 BTC Casascius bar.
In late 2013, while perusing blockchain.info, I found transactions with structured data hiding in a recipient’s pubkey and I realized that Bitcoin – the most important invention of my lifetime – was being used to encode the second most important invention of my lifetime: the ability to record immutable representations and movements of digital scarcity, as defined by anyone, riding on top of a massively secure, universally accessible state machine. I promptly quit my job and joined the amazing Mastercoin team, where we developed the tech and turned it into Omni.
BC: Can you explain what Tether is to our readers?
CS: Tethers are dollars, euros, yen, or really any currency. Think Venmo on the blockchain. Tether dollars can be sent to and from Bitcoin wallets. Tokens representing stable, real-world money, tethers act otherwise just like bitcoins.
Tether, the company, acts like a meta-Coinbase, providing for the purchase of tether dollars while holding the fiat currency (bank dollars) in reserve for claim by someone redeeming tether dollars at face value. Tether uses the Omni layer to issue and revoke the dollars on the Bitcoin blockchain, keeping the number of tethers in circulation exactly matching the fiat in the reserve.
Tethers are used to transfer money between bitcoin exchanges such as Bitfinex, make online shopping purchases using Shapeshift, act as a hedge against the more volatile underlying bitcoins, or they can just be dollars sitting in your multi-sig bitcoin wallet.
BC: You advise on projects such as MaidSafe, Factom, Synereo, Tauchain and Fuzo, can you tell us about this experience?
CS: Working on the digital currency bleeding edge, I have the privilege of collaborating with wizard developers and extremely lucid, forward-thinking technologists. I also have an affinity for things that are legitimately novel. When those things come together, I take an interest and assist in whatever way I can.
MaidSafe decentralizes the internet; Factom can timestamp the entire universe, Synereo turns cryptographic addresses into message-passing neurons, Tauchain can create a self-building logic-verifying blockchain, and Fuzo puts the crypto on your SIM card. Notice a theme?
“’Someone should hire this kid’ in my head was immediately followed by ‘I’m hiring this kid.’”
BC: You were one of the first to discover Whit Jack “the Bitcoin Kid” can you tell us about this?
CS: Speaking of wizards, Whit is the kind of guy you know you’re going to admire once you’ve heard him speak. Hearing him explain, in his precise, 14-yr old voice the cryptographic primitives he modified to create his own cryptocurrency, I realized he was the guy I used to wish I was when I was 14 and dialing into the internet at 2400 baud. “Someone should hire this kid” in my head was immediately followed by “I’m hiring this kid.” His job is to find interesting ideas in cryptocurrency that he wants to explore and to build them (unless he has a debate tournament or is at summer camp). He’s brilliant, brilliant to work with, and his parents aptly encourage Whit’s passion for knowledge and innovation.
BC: Do you believe there are any 2.0 crypto-projects that are currently enterprise ready?
CS: I know there are (I’m using one). Scalability, though, is the concern as 2.0 projects rely on the 1.0 foundation (and yes, I do hate that nomenclature). The potential use cases will continue to broaden what these projects can provide.
BC: You also work with the Omni layer project how is that going?
CS: Omni is the core of my current endeavors – and what it can do continues to expand. It’s the Blockchain’s coolest secret. A Bitcoin blockchain meta-protocol such as Omni provides a relatively simple ruleset (hard-wired smart contracts) for recording immutable state changes of arbitrarily defined digital objects. It runs literally on top of Bitcoin, within Bitcoin. It’s a magic ledger.
“Omni is the core of my current endeavors – and what it can do continues to expand. It’s the Blockchain’s coolest secret.”
The official release of Omni core 0.0.10 this month unveiled a myriad of new firsts (the team enjoys that) such as on-blockchain dynamic feature activation (update blockchain parsing rules without a software upgrade; yes, this is extremely impressive). One of the features that will be turned on using this new type of transaction is the new on-blockchain decentralized exchange. Without intermediaries, Bitcoins can be traded for omni (the native token), and omni can be traded on the decentralized exchange for other assets on the Omni layer such as Tether currencies, MaidSafeCoin, Synereo AMPs and tokens and objects from upcoming and astonishing projects.
BC: How do you feel about the current state of the digital currency industry as we speak?
CS: I couldn’t be genuinely more excited about it, technologically. I am continually in awe of what’s being built in this industry. I hope more companies in the space can realize productive partnerships with one another, as so many services can easily leverage the strength of their compadres’ offerings. So long as security, usability, and ease-of-use are primary foci for consumer-facing digital-currency companies, we’re going to see a lot of uptake. Banks are dipping several toes in at once at this point, and the water’s not too hot.
“So long as security, usability and ease-of-use are primary foci for consumer-facing digital-currency companies, we’re going to see a lot of uptake.”
My current diversion is what will happen with some of the smaller yet extremely innovative startups that do not have adequate revenue to sustain full operation or cannot easily raise additional capital. There is valuable intellectual property out there (and some pretty impressive relationships with heavy hitters) that the world may not yet fully appreciate, but that still needs to be developed (the kinds of things you know you’re going to need, but these guys are too early). Blockchain talent isn’t easy enough to find, yet, but if you know where to look…
BC: What is your opinion on the block size debate?
CS: It’s a contest between “how much can we cram in it” and “how cheap can we keep it” with a little bit of welcoming our new miner overlords. It’ll find a balance, or the money will go elsewhere.
If our shared assumptions are correct, there is going to be a substantial increase in the volume of Bitcoin transactions – which should be good for everyone as it validates the use case – but I have already been on the slow end of first-confirmations due to transaction size vs. fees, and I promise you, it’s not pleasant.
BC: How do you feel about the political outcry right now against encryption and digital currencies?
CS: Freedom of speech encompasses seemingly random sequences of characters that mean what only I say they mean. Representing information using patterns to render it differently is the essence of art. They wish to destroy inspiration, and inspiration drives economies. Stopping an economy is hard; stopping art is harder. Stopping math is impossible.
BC: What can we expect from Tether and Omni in the future?
CS: Whatever you can imagine using money and scarce digital objects on a magic ledger.
What do you think of the internet’s current magical technologies? Are they game changers? Let us know in the comments below.
Disclaimer: Readers should do their own due diligence before taking any actions related to the mentioned companies or any of its affiliates or services. Bitcoin.com and the author are not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. This editorial is for informational purposes only.
Images credits: Shutterstock, and Craig Sellars
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