In the early days of cryptocurrency’s golden age, Bitcoin.com conducted an extensive interview with Craig Sellars, co-founder and CTO of Tether, and core developer of the Omni protocol (formerly Mastercoin). As an advisor to Factom, Synereo, MaidSafe, and other pioneering projects, Sellars painted a vivid picture of a decentralized future built on a blockchain “magic ledger.”
From Bitcoin to Omni: Discovering the Magic Ledger
In late 2010, Sellars stumbled upon an obscure blog about someone pouring their life savings into a new digital currency run by no one. “It was the kind of thing that should catch any libertarian CS nerd’s eye,” he recalled. He downloaded the first Mac build of the Bitcoin client and started mining, but shut it down almost immediately because his computer was about to melt. In summer 2011, he bought his first bitcoins and even considered splurging $4,500 on a 1,000 BTC Casascius bar.
The real breakthrough came in late 2013 while browsing 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: the ability to record immutable representations and movements of digital scarcity on a massively secure, universally accessible state machine.” He promptly quit his job and joined the fledgling Mastercoin team, which later evolved into Omni.
Tether: Stablecoins on the Blockchain, Like Venmo
When asked to explain Tether, Sellars gave a definition as clear as it was simple: “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 act just like bitcoins, but are issued and revoked on the Bitcoin blockchain via the Omni layer, ensuring that the number of tethers in circulation exactly matches the fiat held in reserve.
“Tether, the company, acts like a meta-Coinbase,” he added. Users purchase tether dollars, while the company holds fiat currency in reserve for redemption at face value. Tethers are used to transfer money between exchanges like Bitfinex, make purchases via Shapeshift, hedge against Bitcoin volatility, or simply sit in multi-sig Bitcoin wallets.
Advisory Work: From MaidSafe to Synereo
Sellars also served as an advisor to multiple cutting-edge projects: MaidSafe decentralized the internet, Factom timestamped the entire universe, Synereo turned cryptographic addresses into message-passing neurons, Tauchain created a self-building logic-verifying blockchain, and Fuzo put crypto on SIM cards. “Notice a theme?” he quipped.
He also shared the story of Whit Jack, a 14-year-old “Bitcoin Kid” who had created his own cryptocurrency. “Hearing him explain, in his precise, 14-year-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. Someone should hire this kid – I’m hiring this kid.” Sellars gave Whit the job of exploring interesting ideas in cryptocurrency and building them, unless he had a debate tournament or summer camp.
Omni Layer: The Blockchain’s Coolest Secret
“Omni is the core of my current endeavors – and what it can do continues to expand. It’s the Blockchain’s coolest secret,” Sellars declared. As a meta-protocol running on top of Bitcoin, 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.”
The official release of Omni core 0.0.10 in December 2015 unveiled several firsts, including on-chain dynamic feature activation – updating blockchain parsing rules without a software upgrade. “This is extremely impressive,” Sellars noted. One of the features activated via this new transaction type was the on-chain decentralized exchange (DEX). “Without intermediaries, Bitcoins can be traded for omni (the native token), and omni can be traded on the DEX for other assets on the Omni layer such as Tether currencies, MaidSafeCoin, Synereo AMPs, and tokens from upcoming projects.”
Industry Views and the Block Size Debate
Speaking about the state of the digital currency industry in 2015, Sellars said, “I couldn’t be genuinely more excited about it, technologically. I am continually in awe of what’s being built in this industry.” He expressed hope that more companies would form productive partnerships, adding, “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.”
On the block size debate, he summed it up succinctly: “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.” He also noted his own experience with slow first confirmations due to transaction size versus fees, calling it “not pleasant.”
When asked about political pushback against encryption and digital currencies, Sellars offered a philosophical defense: “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.”
The Future: Whatever You Can Imagine on a Magic Ledger
Asked what to expect from Tether and Omni going forward, Sellars delivered a line that became the interview’s defining quote: “Whatever you can imagine using money and scarce digital objects on a magic ledger.” That vision, now nearly a decade old, foreshadowed the explosive growth of stablecoins, decentralized exchanges, and the entire DeFi ecosystem.