Announced with no fanfare on Reddit last week, Tari will be a second layer protocol for digital assets built on Monero. A competitor in some ways to Ethereum, Tari will provide a Monero-based platform for the creation and trading of tokens. The project, which is named after historic gold coins once used in the Mediterranean, has secured the backing of iconic venture capital investors including Redpoint, Trinity Ventures, Canaan Partners, Pantera and Multicoin Capital.
The team consists of the Monero founder Ricardo ‘FluffyPony’ Spagni; entrepreneur Naveen Jain; and Dan Teree, co-founder of Ticketfly. Their shared expertise will help build a protocol which promises to simplify the management, trade, and programmability of all digital assets, including things like “tickets, in-game items, loyalty points, and cryptonative assets”.
Tari a second layer for Monero
Blockchains are increasingly incorporating second-layer solutions as a way to scale effectively and provide room for experimentation. The most well known example is the Lightning Network, which aims to speed up the Bitcoin network by storing transactions off-chain.
As a second layer protocol, Tari will remain distinct from the Monero blockchain, but will incorporate token creation and trading functionality on an additional layer. This is comparable to the Colored Coins concept, which allows for a second layer of token functionality on top of the Bitcoin blockchain.
Adjustable privacy settings for tokens
The Tari protocol differs from Ethereum in that it is dedicated solely to the provision of tokens, without additional functionality like Smart Contracts or Decentralized Applications. As software that is optimized specifically for asset-based tokens, the Tari protocol hopes to unlock additional utility for digital asset users, and enable “true digital asset ownership and control.”
This means opening up new parameters for token creation—allowing creators to adjust the privacy settings of their token in line with the intended use case.
This is a pivotal step for the evolution of tokens, and could potentially lead to a new token economy that is far removed from regulators. One Redditor speculated on the possibility of ICOs being launched on Monero: “So, will we be seeing some of the ICO craze hit the blockchain? This will be perfect for the scammers. 🙂 They can raise their funds, and then just vanish into the Monero blockchain.”
Unlikely perhaps, as Spagni himself has been scathing of ICOs, opting instead for the traditional VC model to fund this venture. He does, however, seem to be betting on the importance of privacy in a future tokenized economy. As such, he is stepping down as CEO of MyMonero and GloBee, in order to focus primarily on Tari.
Ticketing with a twist
The primary use case for the Tari protocol, at least in the beginning, will be ticketing. Tari aims to allow issuers of digital assets, like concert tickets, to be able to set rules around the way that the asset is used. This looks to do away with the thriving black market for ticket reselling by attributing ownership data to a decentralized system that mandates, for example, that a certain percentage of all resales are redirected to the original artist. Not an insignificant ambition, considering that the market for the secondary reselling of tickets has been valued in the billions.
John Pleasants, former CEO of Ticketmaster, spoke of the potential for Tari to recover lost revenue in the entertainment industry: “Tari can help the entire live entertainment industry recover billions in lost revenue by better controlling how tickets are sold and resold. From a gaming perspective, the ability to buy and sell virtual goods on a distributed system across different platforms can greatly improve both monetization for publishers and the overall consumer experience.”
For ticket buyers, the protocol claims that it could solve the problem of “economic leakage,” by preventing middlemen from capitalising on the captive market provided by ticket sales. Like the Stubhub resale service, cited by Naveen as an example in a TechCentral podcast, which charges fees in addition to the price of the ticket.
The Tari protocol has yet to deploy a test network, and there is not yet an official launch date, but the call has gone out to recruit staff for teams based both in Johannesburg, SA and Oakland, California.