{"id":1574844,"date":"2021-12-21T06:00:28","date_gmt":"2021-12-21T11:00:28","guid":{"rendered":"https:\/\/wordpress-1016567-4521551.cloudwaysapps.com\/?post_type=station&p=1574844"},"modified":"2022-07-15T11:53:33","modified_gmt":"2022-07-15T15:53:33","slug":"the-future-of-the-world-economy-a-discussion-on-decentralized-cryptocurrency-with-joshua-scigala","status":"publish","type":"station","link":"https:\/\/platodata.io\/plato-data\/the-future-of-the-world-economy-a-discussion-on-decentralized-cryptocurrency-with-joshua-scigala\/","title":{"rendered":"The Future Of The World Economy: A Discussion On Decentralized Cryptocurrency With Joshua Scigala"},"content":{"rendered":"<\/p>\n
With the world moving towards runaway inflation, even possibly hyperinflation, we need to take stock of the tools we have at our disposal. One of these is decentralized cryptocurrencies, and in this episode, we examine why we must take a closer look at these financial assets. Monika Proffitt sits down for an insightful interview with the co-founder of TheStandard<\/u><\/a>, Joshua Scigala<\/u><\/a>. Joshua and Monika look at the current state of affairs and delve into stablecoins, collateralized debt and the threat of hyperinflation, and how crypto can help. Tune in to learn more.<\/p>\n \u2014<\/p>\n [embedded content]<\/p>\n I\u2019m here with Joshua Scigala Cofounder of <\/b><\/strong>The Standard<\/b><\/strong> at <\/b><\/strong>TheStandard.io<\/b><\/u><\/strong><\/a>. Thank you so much for joining us.<\/b><\/strong><\/p>\n Thank you for having me, Monika. It\u2019s fantastic.<\/p>\n I hear your accent. I\u2019m wondering, where are you located right now?<\/b><\/strong><\/p>\n I was born in Berlin, grew up in Australia and back in Berlin. I call myself an earthling at this stage.<\/p>\n I didn\u2019t hear the Australian. I heard what I thought was a bit more of a British, but I understand now this is me having no idea what I\u2019m hearing.<\/b><\/strong><\/p>\n I\u2019ve had to tone down my Aussieness for the Germans, so they could understand what I\u2019m talking about.<\/p>\n People do tone a lot of things down for the Germans. My old family is of German heritage and that stiff upper lip and that need for precision. It\u2019s almost everything, including now. I see even one\u2019s dialect and accent. I want to talk about The Standard a little bit because we can pick on a lot of centralized structures and currencies throughout this conversation and that\u2019s what I love picking on. I\u2019m all in.<\/b><\/strong><\/p>\n I wonder how or what type of centralized is because I\u2019m based in the states and so many of our readers are based in the states. We often ignorantly end up with this SEC United States-centric view and a lot of times that that leads to an arrogant barrage of regulation and problems that we run into in crypto. We can still blame it on the SEC because they cause plenty of problems, but it sounds to me like when you talk about regulation, centralized currencies, governments and regulations in general, you\u2019re not focused on what\u2019s happening in the US. You\u2019re looking at a broader issue of regulations that are meddling in a space that maybe they don\u2019t have a real reason to be.<\/b><\/strong><\/p>\n I come from the early crypto people who were obsessed with changing the system and the reason why Bitcoin was invented in the first place was to remove central authority from the ability for people to transact freely and have a win-win situation like in a typical free-market sense where at that moment that\u2019s a win-win and people do a trade and hey, presto.<\/p>\n I find that a lot of the issues that we talked about include inflation and everything leading up to Bitcoin are built into the stablecoin structure as well as the CBDC structures that are being pushed upon everyone now, like, \u201cCBDC is fantastic.\u201d They\u2019re extremely dangerous for human freedom and what we\u2019ve built. It goes back to the Magna Carta. It\u2019s taken a long time to get this freedom that we have now. To start to fall into a lot more control grids as we turn into a more of a technocratic society, we have to be careful on what we choose as technologies that don\u2019t enslave us more, but rather free us and make the weak more private and the powerful more transparent. This is the way you want to move forward.<\/p>\n The reason why Bitcoin was invented in the first place was to remove central authority from the ability for two people to transact freely and have a win-win situation. <\/a><\/span>Click To Tweet<\/a><\/span><\/p>\n When you say these are very dangerous things to have a centralized government-issued fiat-pegged stablecoin, some of our readers may be very new to crypto and many of us are not, so we know what stablecoin means. To talk about an algorithmically stabilized stablecoin is a different thing which is going to be interesting in and of itself. To first set the groundwork, what makes a fiat-pegged and a centrally distributed stablecoin a dangerous thing in crypto specifically.<\/b><\/strong><\/p>\n If you go back in history, when people were walking around with gold and silver in their pockets, generally silver, because the gold was for more elite Kings and Queens and silver was for the plebs or the normal people. It\u2019s very heavy to carry around gold and silver, plus it\u2019s a bearer-based instrument. If you get robbed, it\u2019s terrible.<\/p>\n What people did was go into voting facilities. They drop off their silver. They\u2019d get a certificate and the voting facility will say, \u201cYou\u2019ve got twenty grams of silver and here\u2019s a certificate.\u201d Instead of on the way to the market or going to the voting facility, I would say to the market person, \u201cIf you give me that watermelon, I\u2019ll give you the certificate.\u201d There in started the paper money route, and everyone was happy with this paper money pegged to silver and gold.<\/p>\n Very quickly, the voting facilities were like, \u201cNot everybody\u2019s going to come and run to us and withdraw at the same time. Let\u2019s start writing more receipts than we have gold for and ask interest for it.\u201d All of a sudden, they\u2019re printing money out of thin air and got so wealthy from this that people would, be amazed at the estates that these bankers, huge castles and mansions that no Kings and Queens would ever be able to afford that.<\/p>\n After that, the French revolution would happen and these revolutions where they started cutting off heads and people were like, \u201cCan we calm down? Stop cutting off people\u2019s heads. It\u2019s not a good look. You let us as voting operators and bankers continue doing this, giving receipts out and charging interest for it and we\u2019ll give you a cut as creditors.\u201d This is where interest starts coming from and fractional reserve banking.<\/p>\n That became the legal structure of, \u201cLet\u2019s have less on deposit than we have out there floating around in a legal state.\u201d A lot of these centralized stablecoins, let\u2019s say USDC or Tether, say they have $1 sitting in a bank account and for one ERC-20 that\u2019s floating around. That\u2019s fantastic. It\u2019s all great and good, but certain things can go wrong with that. One is that there are four levels of trust there. One is that you have to trust the software. It\u2019s the software that you store your keys in that doesn\u2019t get hacked. It doesn\u2019t get changed. The second level is you\u2019ve got to trust the issuing company.<\/p>\n Are they printing Tethers out of nowhere and saying they have less? You have to trust the bank that they\u2019re storing all this money. Is it going to be another financial crisis where they collapse and it takes all this economy with them in the digital space? You\u2019ve got governments where those banks sit. Are those governments going to say, \u201cThere was a big transaction on the DOCK markets with these stablecoins. We\u2019re going to freeze the entire lot or we\u2019re going to generate our own stablecoin and make you illegal.<\/p>\n If you look at these multiple attack vectors, they\u2019re very scary and not only that, if you have a company. You can print as many infinite numbers as you like. By rare numbers like Bitcoin and Ethereum with those infinite numbers, you can basically start to control and manipulate the market on this rare asset market. There are multiple existential threats to the crypto industry by having these centralized power structures be so powerful. We got told by JPMorgan Chase that they have now categorized Tether to be up there with BlackRock in terms of purchasing power. It\u2019s gone insane.<\/p>\n To think of Tether being on par with BlackRock is very alarming. When I think about The Standard, I do not know a lot about algorithmically stabilized coins. What I do know of them and this is where I\u2019m going to say the wrong thing and then you get a chance to correct me. It sounds to me like there\u2019s a whole bunch of math involved in trying to create something that is stabilized on its own and that has a more transparent issuing protocol behind it. It\u2019s tied to a fiat system that hopefully can remain buoyant and stable, even amid other currencies, even fiat currencies falling. The only algorithmically stabilized coin that I\u2019ve ever had any even brushed with was years ago with the Basis coin.<\/b><\/strong><\/p>\n I believe they raised a bunch of money and then something went wrong and they had to give it back or the projects went away. That was the only time I had a founder sit down with me and say, \u201cHere\u2019s how it goes.\u201d It was the first time I\u2019d heard someone talk about an algorithm being in charge of stabilization. That must have been a bit of a different concept. I\u2019m sure there are many ways that you can slice the algorithmic like a little pie up to make it affect a coin or not. What are the pieces that you baked together to make this stabilized coin on its own?<\/b><\/strong><\/p>\nWatch the episode here:<\/h3>\n
Listen to the podcast here<\/h3>\n
The Future Of The World Economy: A Discussion On Decentralized Cryptocurrency With Joshua Scigala<\/h2>\n