Delays Be Damned: Tezos Blockchain Tech Enters Beta Testing
A nearly year-long wait appears to be over for investors in the embattled block chain project Tezos.
After months of painful wrangling, the Tezos network is up and running – more or less.
The foundation's plan is for transactions that occur on the betanet to remain valid on the mainnet – the final version of the network, expected in Q3 – but it cautioned that large or important transactions should still wait until the network is more reliable.
The Tezos Foundation proposed a first or "genesis" block for the blockchain, the details of which are available here. Participants can connect to the network immediately, the foundation said, and validation or "baking"– the process of maintaining the ledger, analogous to mining in bitcoin – has begun.
Community members, however, will not be able to begin baking until around 29,000 blocks have been found, the announcement added.
Ryan Jesperson, president of the foundation, wrote:
The foundation added that users should be cautious, since allowing anyone to access their private key – through phishing attacks, for example – could lead to the loss of their tokens.
Dynamic Ledger Solutions (DLS), the company that has been in control the code behind the Tezos protocol, has promised to release it as open source software under the MIT license, but the project's GitHub page has not been updated to reflect a new license agreement at the time of writing.
The Tezos Foundation sold $232 million worth of XTZ (or "tez") tokens to the public in a July 2017 ICO. With the launch of the betanet, those tokens are migrating to the freestanding Tezos blockchain.
Surprises and delays
Controversially, only investors who provided personal information to TokenSoft, a third-party provider contracted by the foundation, are now able to claim their tokens.
The foundation did not announce that it would carry out these know-your-customer and anti-money laundering (KYC/AML) checks – which required investors to submit names, phone numbers, addresses, government-issued IDs and selfies – until nearly a year after the ICO, in which the foundation accepted bitcoin and ether.
The delay between the the ICO and the platform's launch is largely due to a conflict that pitted Tezos' founders, Arthur and Kathleen Breitman, against Johann Gevers, former president of the Tezos Foundation. While the Breitmans controlled the code through DLS, Gevers controlled the funds.
The standoff ended when Gevers stepped down in February, but the platform still did not launch immediately. The foundation's decision to conduct KYC/AML checks may indicate that legal and regulatory uncertainties stood in the way.
The Breitmans, Dynamic Ledger Solutions, the Tezos Foundation and others associated with the project have been sued at least four times between them.
Investors have aired their grievances on a technical as well as a legal front. At least two groups of developers have announced plans to create alternate versions of Tezos and to dispense with aspects of the platform they don't like, such as KYC and awards of pre-mined tokens to the foundation.
TzLibre announced the day after Gevers stepped down that it would launch its own version of the Tezos protocol. Another project, nTezos, emerged in response to the Tezos Foundation's KYC announcement. Both alternate Tezos implementations' teams are pseudonymous.
Image via SpaceX archives
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2023, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.