One of the stars of the blockchain world, developer Vlad Zamfir, is in negotiations with a new startup called Casper Labs, an offshoot of Seattle-based blockchain cooperative RChain.
The potential partnership is significant in the world of cryptocurrency because it could introduce a new competitor to high-profile blockchain projects like Ethereum and RChain. Zamfir has been working with both projects for several years. The news comes amid a broader period of turmoil for RChain, which says it’s building a “blockchain platform and social coordination technologies that address the world’s greatest problems.”
The chairman of Casper Labs, Scott Walker, told GeekWire that the firm had signed a letter of intent to negotiate a contract with Zamfir, who is on the board of directors of the RChain Cooperative and is a researcher at the Ethereum Foundation. Though Walker wouldn’t say whether Zamfir had also signed an intellectual property agreement with Casper Labs, the company sent a statement denying that had any such IP agreement had been signed as part of the talks.
This contradicts a recent report by crypto industry publication The Block, which said that the CEO of Casper Labs, Mrinal Manohar, had told them an IP agreement had been completed between Zamfir and the firm. But after publication, Zamfir denied signing an intellectual property agreement.
Not wrong at all! Also never signed any such agreement…
— Vlad Zamfir (@VladZamfir) January 14, 2019
Zamfir also commented on his relationship with Casper Labs, saying on Twitter, “We’re in the process of negotiating a research agreement, and that relationship is very much a subject of negotiation, so I can’t say too much (both because it isn’t defined and because of the sensitive nature of negotiation), but my leaving Ethereum has never been on the table.”
Several people formerly involved in RChain are now part of Casper Labs, including Medha Parlikar, the former program manager for Pyrofex, which was working on RChain. She is now an Executive Vice President for Casper Labs. Steve Careaga, who was formerly the general partner of Reflective Ventures, which formed an alliance with RChain last year, is now the chief financial officer of Casper Labs.
Walker, who is an investor in multiple cryptocurrency projects through his firm DNA, told GeekWire that he has personally invested in Casper Labs during the seed funding round, which is ongoing. Walker wouldn’t disclose how much he or other investors had put into the company, though he said that he had taken an equity stake in Cayman Islands-based Casper Labs. A series A round is about to begin, according to Walker. He also said that that $300,000 per month was being spent by Casper Labs, and that, in total, $1 million had been spent already.
“CBC Casper” Being Developed for Multiple Blockchain Projects
Zamfir, who is 28 and grew up in Ottawa, has been working with both RChain and the Ethereum Foundation, while seeking to bring to life his version of a proof-of-stake blockchain consensus algorithm, called “CBC Casper.” A blockchain consensus algorithm is the set of rules, written in software code, by which the computer servers (known as validators) that make up a blockchain network secure it without resorting to a central party to arbitrate disputes. Proof-of-stake means that the network relies on validators that own some of the native cryptocurrency of the network, and thus have a “stake” in it.
In theory, proof-of-stake is much more computationally and energy efficient than the “proof-of-work” algorithm that bitcoin, the oldest and most widely held cryptocurrency, relies on. Bitcoin requires validators to own specialized computers, known as mining machines, to run repetitive calculations in order to secure the network. Mining machines require large amounts of energy.
Zamfir has been a researcher for the Ethereum Foundation, a Swiss non-profit that has been tasked with developing Ethereum, an open-source blockchain platform founded in 2014 which allows developers to create decentralized applications, also known as dApps. Users who want to access Ethereum dApps generally must use a cryptocurrency called ether (ETH), which can be bought and sold at online-only cryptocurrency exchanges. Ether is the third-largest cryptocurrency by market cap, per CoinMarketCap. There are currently more than 2,000 cryptocurrencies trading on exchanges worldwide.
A working version of CBC Casper is highly anticipated in the blockchain world, as it promises to solve the scaling problem that most existing blockchain platforms suffer from. Zamfir released the initial version of CBC Casper in November 2017. RChain, which was created in 2017 but has been undergoing development since at least 2015, is similar to Ethereum in many ways, though it differs in some technical aspects. It also is attempting to use CBC Casper.
Implications for RChain
RChain’s President Lucius Greg Meredith described his work with Zamfir on CBC Casper for RChain as a “collaboration.” However, according to public records of RChain’s board minutes, Zamfir hasn’t been present at recent board meetings.
Currently, Ethereum is only capable of handling about 15 transactions per second, while payment processor Visa can do about 24,000 in the same time. Meredith told GeekWire that a test version of RChain was able to process 7,000 transactions per second. But RChain’s product has not been released to the public yet. It was supposed to have ready on Dec. 31, 2018 but Meredith said has been delayed until at least the second quarter of 2019.
Casper Labs’ project is using some of the code base of RChain, according to Greg Heuss, the Managing Partner at Reflective Ventures, a venture firm that is investing in blockchain startups as part of a partnership with RChain. When questioned specifically on whether Casper Labs was a fork of RChain, Walker said, “There’s several meanings and several nuances,” to the word fork, but wouldn’t elaborate further.