Finance Security & Privacy

Talking with Tezos Co-Creator Kathleen Breitman

Courtesy of Tezos.com

Kathleen Breitman is person of the hour. She is co-founder of a company called Dynamic Ledger Solutions, or DLS, which has developed Tezos, a new blockchain-based cryptocurrency. Tezos is making major waves right now with its ongoing fundraising, which others are calling an  Initial Coin Offering, or ICO. (DLS says the term is imprecise.) The sale, which ends next week, is being managed by the Tezos Foundation in Switzerland, which DLS set up as a neutral party to distribute, improve, and manage the Tezos “tokens.” As of Friday, the offering has raised well over $200 million, the most ever for an ICO. Breitman and her husband Arthur Breitman, the CTO, co-founded DLS and stand to gain 8.5 percent of the proceeds of the offering as well as receive a substantial amount of tokens over time.

So I was intrigued to meet up with this articulate, composed and enthusiastic 27-year-old. She is at the center of a world that has emerged so fast that even many businesspeople who consider themselves well-versed in tech do not understand it. Cryptocurrencies pose the potential, according to Fred Wilson in his onstage interview at Techonomy NYC, to underpin an alternative network that might dislodge Facebook from its empyrean perch. They may contribute to a radical decentralization of decision-making and authority across numerous, restricted dominions of commerce and government. They could, to hear Breitman and other partisans tell it, help recreate the internet as it should have been all along, with power truly and decisively distributed among its users.

In our meeting at a mid-Manhattan park, I asked Breitman a lot of questions, both smart and stupid. First, what was this offering all about?

“Tezos tokens have three purposes. They’re a way to power smart contracts on the network. They’re a way to vote and participate in the governance mechanism. And they’re also a way to conduct transactions.”

“Tezos has a way to facilitate innovation on chain by creating bounties to people who submit improvements, and have them earmark proposals for improvement with what they consider an appropriate token value in exchange…The main concept behind Tezos is that blockchain as a commons is a good that is shared by everyone, but you need pecuniary incentives to maintain it.”

“My hope is that the Tezos experiment pushes blockchains a little further by incorporating this governance aspect into it.”

Excited as Breitman is about the progress of her company’s innovations, she is careful not to make excessive claims for its success thus far. “The fundraiser being a massive success for the foundation is a key piece of catalyzing this type of experimentation on the blockchain,” she says. It remains experimentation.

But what is someone actually buying when they buy Tezos tokens? Breitman’s answer: “It’s like AWS credits. Tezos tokens are only good on the Tezos network.” So you’re buying a right to participate in the success of the network long term. If the network doesn’t get used, a token might be worth nothing in the future.

But there is real potential that such a network, if it succeeded, could have a big impact on the world. I asked her, “Is what you’re trying to create a platform for the innovation of others?”

Kathleen Breitman: Our tagline is to be a decentralized digital commonwealth.

David Kirkpatrick: For what purpose?

Breitman: Because that’s a cool and interesting thing to do.

Kirkpatrick: Is it for facilitating innovation? Or to become a tradeable form of stored value?

Breitman: Some people will want to use it for self-organizing and literally starting communities on the blockchain and having their own little government, with maybe some economic activity. It’s very open-ended. We’re very non-prescriptive. There is some low-hanging fruit in online gaming…

Kirkpatrick: So is someone who buys what you’re selling joining a game?

Breitman: It’s joining an experiment. People can use it for cool stuff. The whole notion of programming value, however that’s construed, or programming transactions, is very powerful.

Kirkpatrick: Could it be used for anything Ethereum has been used for? [Ethereum is the most successful commercial competitor to the Bitcoin digital currency.]

Breitman: We’re both strong contract platforms, but Ethereum wants to be the world’s computer. We don’t agree with that, because a blockchain is a very slow and costly computer. Ethereum wants to be the app store and to have all the apps. We want to be a Swiss army knife. If there’s something really useful on the fringes or on the leaves of the blockchain, we want to fold them in as first-class citizens. It’s a multi-use token.

Kirkpatrick: Should we consider it a financial construct?

Breitman: Not explicitly financial, but you could use it for data storage or transactions with someone you don’t know in another country.

Listening to this, however confident and impressive it may be in some respects, it’s easy to see how mere mortals might be confused. The range of possibilities of what could change as a result of the success of blockchain-based cryptocurrencies is very large.

Meanwhile, Breitman’s company gets sold to the foundation this summer, and she will then take a role not unlike the kind of role Linus Torvalds plays for his creation Linux—cheerleader, explainer, and champion. “I’ll stay in the ecosystem because it’s like my baby at this point,” she says. “I’m not going to abandon my child.”

The funds raised in the offering will go into research and development for further improvements in design and security of Tezos, to marketing, and to other advocacy. The Breitmans are handing off their baby to the foundation because, as she says, “We need a way to disperse it.”

One big question that looms over this entire fast-morphing space is whether or not there will and should be hundreds or even thousands of blockchains, as is starting to be the case now, or whether eventually there should be just one. Clearly Breitman hopes that her Swiss army knife creation could be that one. “We know there’s only going to be one,” she says, “because the economics favors one chain with a lot of utility.”

But she concedes that in saying that, she is a contrarian. “Most people think the opposite, that there should be a new blockchain for, like, every fire station. I saw an ICO for Dentacoin. But who the hell uses a coin when they visit the dentist?”

Whether or not Tezos is “the one,” Breitman is clearly convinced that this kind of innovation is an inevitable part of our collective future. She says the near-term applications that she is interested in working on herself include using it to enable various forms of micro-insurance, applying it to help gamers, and potentially using it as an element in big data management and analysis. (This last one she says she is more uncertain about, but since DLS has been approached by big data companies to work with them, she is game to give it a try.)

I asked her: “What, then, has held back blockchain-based innovation thus far from having the impact that may be its destiny?”

Breitman: Right now the biggest inhibition to adoption of these systems is design. It’s partly because so far they have only attracted really nerdy people who don’t mind dealing with a command line interface. And it’s partly because we just don’t know how to deal with a digital bearer asset.

Kirkpatrick: What world could become possible as a result of these innovations long term?

Breitman: Oh man that’s a tough question. (She pauses.)…I think people could have more freedom to choose how they associate with other people. Whether it’s through commerce, whether it’s through activism, or their freedom of voice, I think of blockchain technology as a global exit.

Kirkpatrick: Exit from what?

Breitman: From convention.

Kirkpatrick: So that leads me to ask this: The two biggest issues that worry me are the growing repressiveness and intrusiveness of governments around the world, and the power of a small number of large global Internet companies. Do you think these two problems could be remedied by this sort of thing?

Breitman: I hope so. I’m a little bit of a Pollyanna. I got into this first and foremost because it’s a really cool piece of technology, and it’s a solution for something that people have been trying to mull over and engineer for quite some time. So at an engineering level it’s really cool. But it also tickles my rebellious side, and my “screw you” side, to people who kind of own interactions in the internet.

That’s the sort of talk that intrigues us here at Techonomy, where our mandate is trying to capture the biggest issues being transformed by tech in business and society. We, too, are sometimes Pollyannaish optimists with an intrinsic confidence in the potential of tech to help make a better world.

Tags: , , ,

  • Joe Strange

    Their
    ICO isn’t even over yet, and they are already announcing how they are
    going to screw the ‘little people’…widows, retirees and veterans…
    “We
    are incapable of setting up a website that enforces contribution
    ‘rules’ that you can find…if you look hard enough…but we’re going to
    blame those making those contributions and call them ‘stoopid’…
    https://www.minds.com/newsfeed/730621422078009351

    • Joe Strange

      Alleged InterNet ‘reporters’ always seem to be the last to know…
      https://www.facebook.com/permalink.php?story_fbid=238527026655151&id=100014935651574

    • DEV00100000

      The minimum contribution is 0.1 BTC, which was clearly stated and you would know about this if you do any research into what you are investing into. If you could not meet that threshold, then don’t send them a contribution. It’s pretty simple, you’re only getting screwed if you are a moron and send less than 0.1 BTC during the entire ICO. Yes, a moron, because you should always read the terms of what you are investing into. Moron. Let me repeat, you are a moron if you sent less than 0.1 BTC throughout the entire ICO.

      • Joe Strange

        Gee, that’s Tezos’ position. That the people who are sending them contributions are ‘stoopid’…
        Funny that this ‘condition’ is nowhere to be seen in the contribution process. Funny that Tezos is incapable of properly building a simple website and contribution system that only allows contributions according to conditions that are mentioned *elsewhere*…
        Morons? How about the people who invested millions in a ‘cutting-edge tech’ company that can’t handle the simple things without screwing them up… MilliMorons.
        Yet Dave and Techonomy continue to sing the praises of people with little to no integrity. Go figure…

      • Joe Strange

        DEV00100000 has a ‘private’ Disqus profile to hide h/is//er agenda. Very telling…

      • Joe Strange

        DEV00100000 didn’t do h/is/er research. (Hmm, must be a moron)
        Tezos’ official position is that even if your contributions add up to 0.1 BTC you still get *nothing*…
        It’s on their FaceRook page.

        • DEV00100000

          If you couldn’t pony up $250 then you shouldn’t be investing to begin with. You are a moron for sending less than 0.1 BTC when they clearly stated that is the minimum contribution. If you assumed it would be cumulative, that’s your own fault for making that assumption.

          • Joe Strange

            DEV00100000 telling a bald-faced lie, provable by viewing screenshots pasted to the Tezos FB website by victims of Tezos’ fraud.
            “It was clearly stated in a tattoo on Tim D’Raper’s ass. If you didn’t ask to see his ass, you are a moron.”
            Those who want to take part in a class-action suit against Tezos should contact the Silver Law Group.

          • DEV00100000

            Oh brother, go ahead and post these screenshots you’re talking about… I didn’t find any on the Facebook page. Meanwhile, you might want to take a look at this, so you can stop spreading FUD and calm the fuck down:

            https://tezos.ch/minimum-contribution-to-the-fundraiser.html

          • Joe Strange

            DEV00100000 I’m not your frigging BumBoy, if you’re too lazy to go check out the Tezos FB site yourself, it’s not my problem.
            News Flash: The url you cite is not required reading before Tezos takes money from widows. Tezos doesn’t have the technical expertise to design a website without defrauding people with information posted *elsewhere*.
            Sorry if you feel that the rest of humanity is just dirt under your ‘genius’ feet, but it is not the responsibility of non-genius’, such as yourself, to beat the bushes to find out what kind of ‘hidden requirements’ are going to be used to cheat them out of their money.
            You and Tezos *both* seem to have a lot of ‘scorn’ for the ‘widow’s mite’… I’m sure you’ll get filthy rich.

          • Joe Strange

            p.s. – Tell the Rothschilds I said ‘Hi’…

          • Joe Strange

            Wow! All of my posts have an up vote. I’m trending!!!

          • DEV00100000

            I checked the FB, saw nothing alarming and nothing I didn’t already know, that’s why I’m asking you to cite a source for these “screenshots” you were claiming. Again, the information is on the website, always was. Most people knew the minimum was 0.1 BTC because it was stated before ICO in multiple places. You should have checked their Reddit and website before sending anything. If you were too naive to do your own proper research, then that is your fault, don’t expect anyone to spoon feed you or “get rich quick” by investing in something you barely even bothered to research.

            If you managed to click the link and read it (it’s an update on the situation), you would know that they intend to refund anyone who sent less than 0.1 BTC, minus the transaction fees. Yes, all of you that failed to do proper research, they will try to help you out even though they told you not to send less than 0.1 BTC. I don’t know how much more I can hammer it into your head, this was known to anyone that did their research before investing that the minimum was 0.1 BTC. That’s why no one who properly invested sympathizes with your outrage because we all knew the minimum was 0.1 BTC. You could have easily found this out in the help section of the website or on their Reddit, and if you still werent sure, you could have contacted them. They also had many video walkthroughs which stated that the minimum was 0.1 BTC.

            So with that, I’m done here. Next time do your research and don’t blindly invest into something without checking up on the conditions. Whether it’s through Reddit, Facebook, or the official website, always check with an official channel before sending your money.

  • Joe Strange

    DEV00100000 Is a broken record, and a joke. It is no wonder that DEV00100000 has a ‘private’ Disqus profile so that no one can see who s/he is being ‘paid’ to troll for.
    DEV00100000 basic argument is that Tezos bears no responsibility for taking people’s money and giving them *less*than*nothing* in return, because they failed to read the ‘disclaimer’ that is tattooed on Tim D’Raper’s butt.
    “We just *spit* on the ‘little people’…
    “Stop your whining! Our cutting-edge technology experts aren’t capable of designing a website that doesn’t *screw* people. There is no law that says we *have* to post a picture of the tattoo on Tim D’Raper’s butt that says, “Hahaha…we’re going to take your money and keep some of it for our cocaine parites and give you ‘a little bit’ of it back.”

    Oh! Golly, gee…DEV00ScrewThePoor is either *lying* again, is too much of a ‘moron’ to do ‘due diligence’ and find the information that was provided to h/im/er.
    Here you goi…
    https://www.facebook.com/photo.php?fbid=1732244506805388&set=p.1732244506805388&type=3&theater
    Erik Stegman Crazy idea, but how about you post this on your actual contribution page. You know, where people are looking for this disclaimer.
    Erik Stegman Also people who scanned the page diligently for caveats and found none.

    So tell me, DEV00DueDiligence…how much money did you pour into the coffers of a company that can’t design a simple website with any amount of competence?
    Are you a $MORON$ or a $$$$$$$MORON$$$$$$$?