Private Digital Cash with Beam
Welcome to our comprehensive interview series – Humans of Blockchain ™ where we get the best in the business to answer a diverse set of questions.
This series will clear the air of doubt in the blockchain space today by focusing on bringing more transparency to the readers.
Alexander is an experienced personality in the Cryptocurrency Industry and has some insightful opinions about the current financial world we live in.
Humans of Blockchain ™ had the pleasure of meeting Alexander at TOKEN 2049.
Not wasting much time, let’s hear it out from Alexander himself.
1. Can you tell us more about yourself? Your Journey and how you got into the Blockchain space?
I am an applied linguist by education (Applied Linguistics is the study of New Languages and Computer Science). Early on, I started working as a Software Developer, started learning to programme at the age of 14, then I worked as a Software Developer for about 6-7 years, after which I Co-Founded a company ‘Narius’ which was a P2P (Peer-to-Peer) File Sharing Network. It was back in 2005, remember eMule, LimeWire, and many more, they were solving a similar problem as Cryptocurrenciestoday because they were all permissionless and distributed file-sharing networks. We were operating our own network, also pushing paid content (nobody bought it but we were trying). We were also doing it for Mobiles, remember those Symbian days, back when we had Nokia hehe, now it seems like archaeology but it was very nice haha. Then I had a go at making a desktop tool which you could use to right-click any word and get 600+ translations for the word which were taken from Wikipedia, Wiktionary, and other free programs. The tool itself was later sold to another big company. Then I worked for a company known as WeFi, which was for Data Analytics on the Mobile. We were collecting data from a lot of mobile devices, and carrying out Analytics to understand different usage patterns. We were collecting a lot of data but made a big point of not storing any personally identifiable data. Even in those days, it was super important for us not to comprise privacy. After that, I spent a couple of years in a VC Fund, investing in Israeli technology and growth of late-stage companies. The areas which we invested in were Hardware, Semiconductors, 3D Printing, and a lot of other different industries and then at some point, I felt that I wanted to come back to actually doing things, rather than looking at other people doing things. And then there was an opportunity to join Beam, and I joined in July last year.
I am relatively new to Cryptocurrencies, I started learning about these new things in 2018, and once I understood, the technology was really fascinating. It was a permissionless ledger where you can trade stuff without any authority. And when I learned about MimbleWimble, it was even more fascinating. The person who built it, just took the Bitcoin architecture and refined it and turn it upside down, you will see that it provides full confidentiality without the Scalability penalty. So, the great things about MimbleWimble are that –
It’s fully confidential. No information can be retrieved from the Blockchain (Senders, Receivers, Transactions, Amounts, Nothing)
It does that with great Scalability.
So the Blockchain is more than just Bitcoins. However, it is still Proof-of-Work, decentralized, distributed, permissionless, an ideal technology for Cryptocurrencies and transfer of value in general.
2. Can you tell us more about Beam? The vision/ mission of the company?
Beam is out there. Working, running, people are mining, people are trading, people are paying each other but we don’t know because it’s all confidential. The vision is to create a system for transfer of any kind of value, basically confidential assets or tokens which can be used via the Blockchain. This transfer needs to be both confidential and opt-in compliant. So the idea is that if a business wants to use a currency, they would want several things, they would want it to be confidential because they don’t want everyone to see what they are doing, but if you are a regular business, you need to report and at some point you want to convert some or all of your assets into FIAT because FIAT is not disappearing anytime soon and the governments are not disappearing. We are trying to build a Bridge between the world of Crypto and the existing establishments to make things better for everyone (Cheaper, Faster), where users can guard their own assets but with compliance, which people can choose to do.
3. Beam is based in Israel, would Jurisdiction be a supporting factor or a pulling one for the company?
Our company is actually registered in Malta, we have a subsidiary in Tel Aviv, but I would say that the Jurisdiction in Malta is more ‘Aware’. Not sure if it’s supportive but it is aware of cryptocurrencies, but I think Jurisdiction in Israel is also pretty good so we are looking at different options here. Right now there is no pressure from Jurisdiction whatsoever, there are some discussions though. Like in France there was an initiative to maybe ban private coins, which I think is kind of childish because it’s almost impossible and it’ll still happen. The genie’s out of the bottle and we can’t put it back, private currencies are out there and if you forbid them, you are kind of pushing them more towards their ‘dark’ usage which is not big at all today. It’s not like criminals are using Monero or Beam, they’re using cash (euros and dollars) because it’s easier and more popular. I think governments need to find ways to work with it and give people their privacy and also let people report, and most people will.
4. Beam’s main focus is on privacy. Privacy is controlled for limiting the bad actors, how does Beam limit the bad actors?
Beam wants to be exactly like cash. So a dollar bill does not control the actors. Beam is exactly the same, we don’t know the information of our users. What we want to do is give people full sovereignty over their asset which other Cryptocurrencies give but also on their information. So if you need to disclose or want to disclose, you’ll be able to do that with Beam. But if you don’t want to disclose, we cannot make you. Same as Cash.
Like, take the case of a Starbucks. A person buys coffee with cash. The only identifiable information here is a receipt punched by Starbucks which indicates cash for coffee, and when the money is reported it is legit because of the one-sided receipt. We want to create a similar situation.
Another example is checking the legitimacy of a Bitcoin and it works like let’s trace the whole history of this particular coin and see if it wasn’t involved with anything in the past but even if it was, and if I got it from a guy, who got it from another guy, who again got it from another guy, who five years ago did something wrong, how am I supposed to be responsible for that?
Same as cash. I’m sure that every bill we are using today might have been used for something illegal in the past. And if I got it from a gas machine in a legal way, there’s no way to check.
5. Right. So replacing Cash with Digital Cash?
Not just that. I am using Cash as an example of something that’s private and reportable. But cash has the deficiencies of being controlled by the government and is victim to inflation. A recent example would be like the government in India carried out a demonetization where they said that this particular bill is not valid anymore and everyone was like ‘ok so what do I do now?’ which is kind of terrible, you cannot use a lot of cash in a single place because it is dangerous, the governments can print as much cash as they want, FIAT is in banks and the banks can control it, these are some deficiencies of cash. The good properties of cash which we are focusing on is that it can be fully confidential but it can be compliant.
6. Diverting from Privacy, what are your thoughts about the current Education/ Information Flow in the Blockchain Industry?
I think it needs to get to a point where we don’t need much education. I mean if you need to educate people too much about something, it means that it is too hard to use and everybody does not even have the time to learn because everybody is busy with their own lives. Our goal is to remove the complex information and make it very easy for the people where you can just have a wallet on your phone, that you can use and pay for things. I believe we need to promote trust more than education. Like when we talk about WeChat or Credit Cards, do we really know what’s going on? Not really. How does this magic work? I touch something with my card and I got my coffee. I don’t care, it’s nice, it works and everyone is using it. So I think it’s more about usability, and ease of use.
Then again, this market is kind of in it’s beginning, so there’s a lot of different technologies and players who are trying to convince everyone that their product is the best. So, of course, there’s a lot of misinformation but I think the best technology will prove themselves by the ease of use, security and all the factors we have discussed up until now, rather than hoping to educate the masses about how this works.
7. We are in the first quarter of 2019. What do you see the year holding for Blockchain Projects?
I think privacy is one of the more important aspects and there are a lot of projects trying to build something in that area. And it is important for everyone to realize that most of the Blockchain projects are not giving any privacy if they are permission based. So this is number one, Privacy and number two we will see a lot of empty projects, scams and fake projects disappear. The projects with substance will remain. Because the past couple of years, money was just flowing freely in the industry which was not good, so the good projects will remain and the weaker ones will disappear.
Check out More Humans working in the Industry Here!