Earlier in the month, I had the pleasure of speaking with Eric Benz and Nick Williamson, co-founders of Credits. While industries are just recognizing the potential of blockchain technology, this UK-based startup has spent the past two years creating a platform to build multipurpose blockchains. The goal is to give third parties easy access to their own private blockchain without the hassle of building one from scratch. Already, Credits is working with the Isle of Man in the first government-run blockchain project. In the media clip below, you can hear our discussion about Eric and Nick’s careers, their current projects, and what lies ahead for Credits in 2016.
Before I spoke with Eric and Nick, I had interviewed Nick. Below is a transcript of the audio interview with Eric and Nick for those who prefer to read followed by the interview with Nick.
Carlo: Could you tell me a bit about your backgrounds in finance and/or Fintech? Then I’d love to hear a bit more about what got you interested in blockchain technology in the first place.
Eric: It started for me about 10 or 12 years ago now. I’ve been in startups for quite some time in the payments and gaming and identity space. Early on, it became clear that there’s a lot of very interesting technologies and things that companies needed in order to do things more efficiently. So my background covers those different areas. I took some time off, obviously, during the financial crisis. I kind of had a career change, working for a hedge fund in the city here, one of London’s main art traders (that was a nice little detour).
But then I found bitcoin in 2012, got my payment brain going again, and started working with a lot of bitcoin and blockchain companies early on, providing different financial service, consulting, and helping companies structure their business and access bank accounts, working very closely with the Isle of Man government, obviously with my gaming network, etc., and that’s actually where I met Nick. After going through and understanding a lot of the different offerings out there in the bitcoin space, and being met with a lot of friction in terms of actually penetrating real-world industries, etc., in the capital market space and government. And when I saw Nick’s technology and what he was envisioning for Credits, it became very apparent that there was something worthwhile here.
Nick: I started off in finance, as that was what I was pursuing for a degree back in the states, and during that time I started working for a hedge fund administration company shortly after the financial crisis, and worked for them for a short period of time. After that, I detoured away from finance quite quickly. I started working as a professional poker player for a few years, and played online poker for a living for a while. One thing led to another, and a few year later I got hired by a company called Pokerstars, the world’s largest online poker company, to go and manage the operations and software of their rem-games offerings, one of their product lines. Just before they hired me, I actually found bitcoin. Some people that came to the poker forum started talking about it and I started looking into the technology and some of the projects that were being built on it. [I] found it interesting, started doing some research, started looking into building some toy projects on top of it myself. And then while I was working for Pokerstars, I continued to do some experiments and built some side projects, including a decentralized files storage system, a library for provably fair reserves for some cryptocurrency exchange software, and some other bits and bobs that were mostly scratching an itch here or there on exploring blockchain technology.
As part of that, I started looking at different consensus mechanisms, different ways that you could go about constructing blockchains or looking at different options that you could potentially enable to provide different use cases on the blockchain. That resulted in some experiments that eventually led to Credits, to building the first iterations of Credits.
That was originally being built sort of as a cryptocurrency just with a new consensus mechanism and a new way of sorting data and all that stuff. Then about seven-eight months in, [I] started looking at what some of my friends in the community were trying to build on top of blockchains, whether that be online gaming, things like trading card game applications or some other interesting use cases. But they were really coming up against a wall, building on top of bitcoin at the time, really sort of working against themselves by tying themselves to the bitcoin codebase. So I started looking at what it would take to put some of those use cases on top of what I had built already with Credits, and it actually ended up being a rather good fit for some of those use cases.
Around that time – and this is about when Eric came on as well – [we] started moving it from something that was cryptocurrency-focused to something that was more looking at building a framework that allowed for building bespoke products and services on top of the blockchain. That’s exactly what it’s morphed into at this point. Really what we’re offering now is exactly that framework that allows you to build your use case, your product, as its own blockchain. One of the key benefits of credits – because these blockchains are interoperable – the fact that it’s its own standalone blockchain doesn’t prevent you from tying into that larger ecosystem, that larger blockchain ecosystem that allows you to access things like payments or KYC or information streams, that are verified and maintained by blockchains. We’re really looking at making it a sort of Heroku for the blockchain world, and a place where you can put your service or app as a blockchain and then other people who want to build services or, whether they’re blockchain services or not, can then, in a provable manner, utilize those services in their own products.
To that effect, we’re actually in the middle of finishing up our SaaS offering at the moment, so you can, without having to deal with any of the deployment or any of the devops or sys admin, or any of the actual plumbing yourself, you can just worry about building the application layer of your app. We’ll handle the consensus layer, we’ll handle the infrastructure. You define your app functionality and interface, deploy it to the cloud, and it’s up and running. You can get an arbitrarily large blockchain network deployed with one click within three minutes
Carlo: The next thing I wanted to talk you guys about, we’ve seen over the past year, there’s certainly been a lot of growing interest in blockchain technology from a variety of different industries. How does it feel on the forefront of that? How does it feel to be on the cutting edge of these blockchain offerings?
Nick: It’s a mixed bag. It’s a double-edged sword. It’s great that a lot of the stuff that we’ve been saying for over a year now is now actually being recognized as a viable way forward, but on the other hand it’s been a bit of an uphill battle. We’ve been sandwiched in the middle between the bitcoin crowd on one side who think that, unless you’re pursuing a completely decentralized, anarchist philosophy, then there’s no point. Then on the other side, not so much anymore but initially, anybody from the financial sector being dismissive of anything blockchain, until it started gaining more momentum throughout the course of last year. It’s great now, because everybody in the blockchain and financial industries [are] pretty much on the same page as us, so that in itself is super validating. On the other hand, now that means we have a lot more competition, so we just gotta make sure that we keep on raising the bar every step of the journey.
Eric: It’s been very interesting to see how the ecosystem has developed over the past three years now. After working with various different companies myself, both not still around and kind of around but not really known, it’s been very interesting to see the choices and the paths that people have taken. The tie to bitcoin – “I’ll buy it strong, initially” – has really given birth to real-world blockchain use cases that can be achieved with different technologies. I think Credits has a very interesting approach that’s a lot different from a lot of the other approaches out there right now.
Nick: And touching on that approach really quick. The way that we’ve done that is we’ve gone to people we sort of had an inkling that had – and [had] an inkling through the people that we brought onto our advisory board from the traditional financial world – that a certain use or certain sector or certain application in traditional finance had a problem that we thought we could solve or that we thought mapped better to a blockchain context, that we would go to those people directly and walk though their actual needs and actual pain points, before even introducing to idea that maybe blockchain can solve those things. So we’ve really taken a value-centric approach, and then backing out what is the technology solution to that. Rather than saying “We’ve think that we’ve got the answer to everything finance forever and for always. First let’s throw everything out the window and then we’ll write out smart contract that replaces all the banks tomorrow,” we’ve sort of taken the opposite approach, where we’ve tried to map out how and why, because the why is important as well. The financial world has evolved, and sort of where the technology that we’re building might be able to augment or streamline some of the processes that are currently providing real value to real people right now.
Carlo: It’s interesting to hear from you guys the different perspective of the other people who you were involved with and who you’ve been speaking. Going along with that point, where do you see blockchain technology moving over the next, say, three to five years?
Nick: I think it’s just gonna become another tool in the toolbox. Just like databases, SQL databases are good at some things, bad at others. When you’re building a service, you figure out what pieces of technology map to the needs that you’re trying to solve, the blockchain is just gonna become another layer to that stack. To when you’re trying to solve a given problem, you can utilize it as another option that’s available to you.
We think that’s generally going to be a viable option when it involves mapping trust networks to an untrusted network or to an internet context. So the way you interact with your government, the way that you interact with your bank, the way that you and I interact in a business context, using the blockchain as a more modern form of establishing initial trust through public key cryptography – sort of a more modern and composable form of PKI – that allows us to establish a meaningful level of trust and a meaningful level of transparency in a much more streamlined fashion. Right now, for example, the way that you onboard identity into an internet context involves uploading pictures of passports and utility bills and trying to find some way of verifying those things and trying to establish whether or not they were just photo shopped. The blockchain, in our mind, provides the promise that you can potentially achieve the outcome that people are looking to achieve with that process without relying on an antiquated paper process but just replicated in an online world.
Carlo: I’d like to hear a bit more about the open ledger project with the Linux Foundation. How did Credits initially get involved with that?
Nick: We got introduced to that project via IBM. We had been talking to some people in IBM who started work on blockchain for quite some time. As the project and the various people involved started to peruse it, we kept up with our conversations with them, we gave a little bit of information about how we were approaching certain problems and how we had solved certain things. It just ended up being a good relationship, and so we ended up being able to join that initiative and contribute behind the scenes for the past couple months. Now we’re gonna start seeing that effort pay off in the public sphere as things start being released in more meaningful fashion in the coming months.
Carlo: Something else I know that Credits has been involved with is working with the Isle of Man government. What kind of cases have you been working with them on? Again, I’d like to hear a bit more about how Credits got involved with them as well.
Nick: We’re working with them on several different initiatives. The two that we’ve announced so far are the world’s first government service run on a blockchain, and that’s a registry of blockchain companies and blockchain supporting companies being maintained by a distributed ledger, by a private blockchain. The validators of that network are three different entities, one of which is the Isle of Man government, one of which is MICTA, the Manx ICT Association, and one of which is our company, Credits. So you have a public organization, you have an industry organization, and you have a private company, in a distributed manner, maintaining the validity of that network. Of course, anybody who external connects to that can verify everything that has been entered as well. Then you have the government officials who are authorized to do so, actually imputing the information, so you get an audit trail that shows that it was those government officials that entered in the information. You get a timestamp and you get a history of how that registry evolved, so it adds another layer of transparency and auditability to a public service.
The second thing that we’ve announced with them is what we’re calling a federated KYC project. That’s sort of what we touched on earlier, taking the blockchain and using the more modern form of PKI in order to onboard and establish real-world identity in an internet context, and then being able to use that in a portable and composable manner across different networks. So a bit like how the CA system works for verifying that somebody owns a certain domain name or that a certain business owns a certain domain name, we’re looking at using that in a more scalable and portable manner with individuals and organizations in generic terms rather than just in the context of establishing SSL connections for websites.
Eric: Just to add to that, the Isle of Man government specifically has been extremely supportive. They were the first jurisdiction to really set the bar in terms of what blockchain and crypto-companies need to actually do in order to operate in a compliant, regulatory manner. I myself have been involved bringing countless amounts of companies over there to get set up and going and, obviously, Credits being one of the most active companies there right now, it’s a great environment to really showcase technology in a very easy manner. They’ve been wonderful.
Nick: A few of the [other] projects that we’re working on them with are really about using the Isle of Man as a test bed for regulatory and technological innovation in such a way that larger jurisdictions and larger organizations can come on board from the beginning. As we’re going through these proof of concept, as we’re putting in the use cases in a real-world context, albeit in a jurisdiction with only 85,000 people, but still using it for a real use case in the real world, so that way we can prove that certain concepts either work or don’t in a relatively low-risk environment before rolling them out to the larger world.
Carlo: The next thing I wanted to you about was the Credits team, what it’s like working with the two of you and everybody else. I’d love to hear more.
Nick: We do have a quite varied team, which has really been beneficial. People from the technology side of finance, people from other industries but have been working in technology. Some of our advisor come from, they’ve been very senior in the financial industry for the past several decades. A few other people on the team have been working at a very deep level in blockchain and cryptocurrency, whether that’s from a marketing standpoint or a regulation or consulting standpoint. Obviously, Eric and myself both have gaming backgrounds, and then Eric has his background in payments as well. It’s really allowed us to draw from both industry experience that comes from our senior level advisory board on what the problems are, what mistakes have been made, what stuff that the finance industry does that’s good [that’s] out there right now. So we get that baseline understanding of the nuts and bolts of the industry that we’re trying to work with. But then with the rest of the team, not necessarily having been steep in that context but being successful in other contexts and other industries, have been able to draw from their experience and bring different work patterns, different ideas that may fit within those contexts to the problems that we’re trying to solve in the finance industry.
Eric: Finding people that actually understand how this technology works, let alone will function in real-world contexts, is obviously [a] very special thing to do, and I think we’ve done a wonderful job finding some of the top talent and industry veterans that have really helped us position and establish ourselves in a way that provides a lot of long-term value.
Carlo: Just from my own personal experience, it’s great when you’re able to draw on experiences from different people who come from different backgrounds. It’s really great in terms of your own understanding and being able to learn from what other people can bring to the table.
The next thing I wanted to ask about was the partner’s program. I believe it’s being released this month?
Nick: It’s being soft-launched this month. We’re going to be announcing some of the first partners this month. We’re going to be making the formal announcement with the full list of partners next month.
Basically what the partner’s program is, we’ve been building our technology for the past two years, and we’ve been mainly the people that have been building on it apart from some of our initial customers. We’ve been taking our products into labs, we’ve been taking our products into POC work, we’ve licensed it a couple of times to different people in the industry for them to build upon, but mostly we’ve been the ones that have been building projects on it. Now that we’ve been testing our assumptions with our first customers and building the use cases that either we’ve brought to them or they’ve brought to us, now we’ve been packaging it up and building the platform that other people to start building actual applications and services on top of it. We’re actually in the process of finishing up launching our private SaaS offering. We’re gonna be making a more meaningful offering available in a broader sense in the next few months. Previously, the way you were able to build on Credits was by paying us consulting and licensing fees in order to do a seed project with us. Now the way that you can start building on Credits is by joining the partner’s program, which for startups doesn’t require any sort of commitment up front. This is the way that we’re gonna start growing our ecosystem and having people build on the Credits’ platform.
Carlo: That last thing I wanted to ask – can you give us a bit of a preview about what’s gonna come next over the next year for Credits? Some stuff that you guys are currently working on?
Nick: Yeah, 2016 for us is all about coming out into the public sphere. We’ve been fairly quiet, just working behind the scenes, doing a lot of word-of-mouth stuff, lots of face-to-face meetings, not a lot of public-facing marketing, not a lot of public offerings out there in a Credit’s context. This year is about putting the Credits’ framework and the Credits’ platform in the hands of a meaningful amount of people and a meaningful number of use cases. We’re really looking to capitalize on a lot of the work we’ve been doing over the past two years, and allow others to take that ball and start running with it in a meaningful way.
Carlo: Did either of you have anything to add?
Eric: What we’re concentrating on right now is bringing partners onto our platform and making sure we can support them. We want to provide a 10x better experience in deployment and developing blockchain use cases. Right now it’s a bit of a pain to do anything product-wise in the blockchain area, and we’re trying to change that rather quickly. Our entire focus right now making sure that ease of use and deployment is available.
Past that, we are in the middle of raising our seed rounds, which will be losing in the next month or two. We’ve previously been self-funded and then funded by revenue. That’s the bulk of our focus at the moment.
[End of Audio Interview]
Nick’s interview conducted before the audio interview:
Carlo: Can you tell me about your background in finance and/or fintech? What got you interested in blockchain technology?
Nick: I started my career in Finance before I went into the gambling space, working briefly for a Hedge Fund Administration firm called Spectrum GFA. I initially became interested in blockchain via Bitcoin which I found out about in mid-2010. I was playing poker professionally at the time, and some friends in the poker community started talking about it. I started looking into the technology more closely and started to build a few projects around it.
Shortly after this I was hired by PokerStars to run their Ring Games Product & Operations, bringing me over to the UK. I continued to work on various blockchain projects and experiment during this time, and a little over two years ago many of the concepts I had been toying with coalesced into what became the first iteration of Credits.
Carlo: Can you tell us the story behind Credits?
Nick: Initially, Credits was scratching a personal itch to look at how you might have a cryptocurrency that didn’t suffer from a lot of the negative tradeoffs in efficiency and scalability that come from Proof of Work mining. However, after talking with some friends in the space who were looking at building more interesting use cases on top of blockchain, it became apparent building on top of existing blockchain code bases was painful, but there were a lot of people trying to do so who had compelling projects they wanted to build.
As a result, we tried putting a few of the use cases on a fork of Credits, and it actually ended up being relatively straightforward. At this point it started to become much more apparent where the value in blockchain might come, so we started explicitly changing the project from a single use case into a more generalized platform for building blockchains, and that’s what we have been building ever since.
Carlo: Can you give our readers an overview of the blockchain services Credits provides?
Nick: Credits offers a framework for creating interoperable, built-to-purpose blockchains. Our cloud offering is being prepared for launch as we speak and allows you to spin up an arbitrarily large private blockchain with a single click.
Our aim is to allow you to keep as much as you want of your existing tooling and workflow in place when building blockchains, and while we are shipping a “batteries included” offering, it’s easy to swap out any of our default options for those who have more specific needs. Our opinion is that getting started in blockchain development is at least ten times more complex than it should be, and our top priority is to radically change that over the next six months.
Carlo: This year we’ve seen a lot of top-tier institutions express interest in blockchain technology. How does it feel to be at the forefront of this emerging industry?
Nick: It’s been really great. We’ve been fortunate that we have a very active and well-connected advisory board which has allowed us a seat at many tables we wouldn’t otherwise have access to, and it’s been incredibly encouraging to see how the attitude toward, and understanding of, blockchain has changed so much across an entire industry in just a manner of months.
The pace of the industry definitely keeps you on your toes, and that’s what makes things interesting. It’s been especially fascinating this past year as the blockchain world and the financial world both started the year with two conflicting opinions about the impact of blockchains on finance, and we disagreed with both. The Bitcoin crowd was adamant that a cryptocurrency was the only way that blockchain made sense, and the finance world was writing blockchain (Bitcoin) off as a toy that didn’t need to be considered. We obviously strongly believe blockchain is going to become an impactful technology and don’t think a cryptocurrency needs to be involved for the technology to be useful, so it’s been very validating that large parts of both groups have come around to agreeing with what we have been saying all along over this
Carlo: Where else do you see the future of blockchain technology heading over the next few year?
Nick: I think we’ll see it pop up in surprising places once the technology starts to mature and we can better quantify its strengths and weaknesses. While the finance industry is currently doing most of the research, interesting use cases in verticals such as supply chain management, gaming, identity, and government are also showing promise. Overall, blockchain is going to become another tool in the toolbox. It’s a piece of technology that comes with certain advantages and carries certain tradeoffs, just like any other.
Carlo: Can you tell us more about the Credits’ team? What about them makes Credits different from other companies working on blockchain solutions?
Nick: The Credits’ team has a fantastic amount of experience in several different industries, many of whom worked at a very senior level in those industries before becoming involved in Credits. We’re not a uniform team by any stretch of the imagination, and that’s where our advantage lies. We have disagreed with those on both sides of the blockchain debate for most of the life of the company, and that’s required that we take apart and question every assumption and approach to building Credits.
We can collectively view everything we’re doing from the different lenses we bring from our respective industries and disciplines rather than either feeling constrained by legacy or, conversely, not considering existing constructs at all. It allows us to avoid the common pitfall of not understanding why a system was built in the first place before trying to come up with a replacement system.
Most importantly, we have a great time together and all feel this is the most exciting thing we can be working on.
Carlo: Can you tell us more about the partners program? How can interested parties get involved?
Nick: Our Partners Program is the first time we’re giving access to our platform externally. Companies that join gain access to the platform and our private beta SaaS offering and access to our demos and prototypes. For companies that build bespoke blockchain products or provide blockchain consulting, we also provide leads for contracts and introductions to members of industry who are looking to bring blockchain into their business. We will also hold various events throughout the year to showcase our partners’ offerings. For most startups and academic institutions, there’s no cost to become involved beyond any usage of our SaaS network.
Anyone interested can either contact us through the form on our website or email [email protected], and we will get in touch.
Carlo: It sounds like 2016 is going to be an exciting year for Credits. Can you tell us more about what else is to come?
Nick: Between the launch of our Partners Program, an impending cloud offering, our work with the Open Ledger Project, and the events we are putting together, 2016 looks to be an exciting year indeed! We have spent two years quietly working behind the scenes, and now we’re ready to join the fray. 2016 is the year blockchain needs to go from being interesting to demonstrating value, and we intend to meet that challenge head-on.
Featured (homepage) photo – Will Sanders
Credits logo and individual photos of Nick Williamson and Eric Benz – Courtesy of Credits