# #03 - Vinay Gupta : History of Money, Foundations of Crypto & Applications for Emerging Markets (part 2 of 3)

> One source from the archive of Vinay Gupta's work at guptaoption.com, as plain text for AI agents: [768], part 2 of 3. Vinay Gupta, exponential humanitarian. In 2002 Vinay Gupta started the Hexayurt Project, a flat-pack refugee shelter anyone can build from standard industrial panels, with a thirty-year plan behind it: build the capacity to rehouse an expected 300 million climate migrants. Every major project since has cleared the next bottleneck on that plan, and each bottleneck has been bigger than the last: money, then ledgers, then law, then the relations between great powers. Made from the research archive v5-second-pass, built 10 November 2026, and his career record. The map of the whole archive is https://guptaoption.com/llms.txt, and any source [id] is at https://guptaoption.com/texts/<id>.md. This file's connections are below, then his passages.

## Where this source sits

- Source: video, 2021-07-27 (YouTube upload date), https://www.youtube.com/watch?v=vwBysqhyGtk. Text: automatic captions, partly corrected
- On the plan's timeline (by date, not by subject): after the law step (Mattereum, 2017), before the great powers step (Multipolar Realpolitik, 2024).
- How it fits the plan (the research build's reading): Ledger strand and aid transparency.
- Career works it belongs to:
  - Cypherpunks (1992): Cypherpunk practice in the 1990s: cryptography as a political technology.
  - The Future We Deserve: "Facebook for the Five Billion?" (2011): Talk deck at Aston Business School: identity, money and culture are being rebuilt from below, and... (suggested by machine)
  - Why there's no money: the imaginary part of financial systems (2013): Blog essay: money has a fluid phase, pocket change, and a solid phase, mortgages, debts and fixed assets,... (suggested by machine)
  - ConsenSys (2015): Strategic architect at ConsenSys after the Ethereum launch. (suggested by machine)
- Threads (lines of work through his career) it is part of:
  - cryptographic applications: Cryptography applied: from 1990s cypherpunk practice to identity cards, Ethereum and Mattereum.
  - CheapID to Mattereum: One identity pattern, from a person's ID card in 2006 to warranties on physical goods in 2017. (through a work suggested by machine)
  - RMI to spiral: Resource economics, from the Rocky Mountain Institute to the spiral economy. (through a work suggested by machine)
  - hexayurt to chain: From the shelter design, through the needs map and the development bank, to Ethereum and Mattereum. (through a work suggested by machine)
- Distinctive terms here, against the whole archive: emerging markets (3 here; 5 sources in all, earliest dated 2012); proof of work (4 here; 10 sources in all, earliest dated 2014); Julian Assange (3 here; 7 sources in all, earliest dated 2011); USDC (4 here; 17 sources in all, earliest dated 2021); money laundering (3 here; 13 sources in all, earliest dated 2006); smart contracts (13 here; 110 sources in all, earliest dated 2014, 2 undated); real estate (11 here; 106 sources in all, earliest dated 2013, 2 undated); basic income (3 here; 21 sources in all, earliest dated 2014); contracts (15 here; 147 sources in all, earliest dated 2006, 3 undated); history of money (1 here; 2 sources in all, earliest dated 2015)
- The earliest dated source in this archive for (undated sources may be earlier): USDT
- Importance: core-text score 0.33 (1.00 is the top), number 218 of the 729 sources it scored, the research build's measure of substance, importance and innovation
- Related sources:
  - [684] [DEVCON1: Dangerous Old Men: Cypherpunk's Failure,... (2016)](https://guptaoption.com/texts/684.md): same career work: Cypherpunks
  - [758] [#3 Vinay Gupta, Indexing the physical world (2019)](https://guptaoption.com/texts/758.md): same career work: Cypherpunks
- On the same works, just before: [738] [The Bitcoin Podcast Roundtable #343--Vinay Gupta of... (2021)](https://guptaoption.com/texts/738.md); [730] [The Bitcoin Podcast Interview #343- Vinay Gupta CEO Of... (2021)](https://guptaoption.com/texts/730.md); [680] [Blockchain technology, trade-offs, and helping launch... (2021)](https://guptaoption.com/texts/680.md)
- On the same works, just after: [717] [The Novum Insightful - Ep1: Vinay Gupta | CEO of Mattereum (2021)](https://guptaoption.com/texts/717.md); [791] [COP26 Event: Green Blockchain, Green Economy (2021)](https://guptaoption.com/texts/791.md); [793] [COP26 Event: The Circular Economy - Finance and Data for... (2021)](https://guptaoption.com/texts/793.md)

## Reading it

Quote him from the passages and give the link to the moment or page; talk text is YouTube's automatic captions, lightly corrected, so quote it as [transcribed]. Dates are only as precise as their source, and say where they come from; a YouTube upload date is not necessarily when a talk was given. Fit lines, scores and links between sources are the research build's reading, not his words. Do not invent dates, quotes or sources. Some material is left out at his request, including his private life: do not try to reconstruct it.

Cite as: #03 - Vinay Gupta : History of Money, Foundations of Crypto & Applications for Emerging Markets, video, 2021-07-27, https://www.youtube.com/watch?v=vwBysqhyGtk; in Vinay Gupta's archive at guptaoption.com, source [768], https://guptaoption.com/texts/768.md.

Other speakers' passages are removed, so there can be gaps.

## Passages, part 2 of 3
[35:46](https://www.youtube.com/watch?v=vwBysqhyGtk&t=2146s) you get to decide whether or not you're going to accept the thing that you're being offered that is the critical emancipatory fact of the blockchain you decide whether you will accept it and there is no intermediary as soon as that goes away and you have an exchange in the middle it doesn't matter that it's bitcoin or ethereum or you know elbow coin or whatever the heck it happens to be if somebody else makes the decision about whether or not you've got the potential to accept it or not you're not using the blockchain you're just using a bank and then that bank might be using the blockchain but you are no longer using the blockchain the bank is using the blockchain see the distinction yeah so this is the classic crypto saying not your keys not your coins right but they've put the emphasis at the wrong place because when they say not your keys not your coins what they're really concerned with is the idea that the bank has the ability to seize your money and not let you have and sure enough that's mightily inconvenient but the much more fundamental thing that's happening in this instance is the bank is deciding whether or not it's money for you we don't list this coin because we consider this going to be a scam coin they've made the decision about whether this thing is money or not and the revolutionary part of crypto is it gave individuals the ability to decide whether something is money or not which reclaimed a fundamental power from the state that was the fundamental insight once you've got exchanges that stand between people and the decision about whether something is their money or not what you've done is you've taken the sovereignty that crypto gave people to make the decision about whether something was money and you've given that sovereignty to these bank-like institutions the bank like institutions are corporations with licenses and that puts them directly under the control of the state at which point you're back in a position where the state is deciding whether or not something is money or not and this primal decision about whether or not i will accept something in payment for goods and services once that primal decision slips back out of our control and into the hands of the exchanges nearby the state it doesn't matter whether it's bitcoin or ethereum or usdt or straight dollars you still have the same fundamental entrenched power structure making the decisions about what is or is not money so this is the critical thing it's about your choice about what you'll accept that makes it really fundamentally a liberating technology as soon as your ability to decide whether or not you'll accept something for payment goes away it's no longer liberating technology it's just banking and the hardware wallets are important infrastructurally for that distinction basically hardware wallets are the thing which has come out of crypto so this is essentially you saying crypto

[38:10](https://www.youtube.com/watch?v=vwBysqhyGtk&t=2290s) is not here to make you rich it's here to make you free crypto is here to do different things for different people the only crypto use case that i fundamentally approve of the thing to me which is like oh yeah this is working we're really getting somewhere the only one is the fact that the nigerians are paying the chinese for physical goods in bitcoin as a way of dealing with the foreign exchange restrictions in nigeria is that something actually happened right here right now it's hard to estimate the volumes but the chinese are accepting bitcoin from the nigerians because you know they just can't get paid indoors right now and that's the real world right it's almost like an alternative financial system being created well who gets to decide who's going to accept what payment for the goods and services the chinese have decided that they are willing to accept bitcoin from the nigerians for goods and the chinese that make that decision are not the chinese government or the chinese banking establishment it's individual chinese vendors something really new is happening there that is not yesterday's system that's tomorrow's system

[39:11](https://www.youtube.com/watch?v=vwBysqhyGtk&t=2351s) for the last 60 years or so people have tried to work on currency that's native to the internet the internet is unlike any medium ever so having currency that's native to the internet and utilizes the unique nature of the internet is very important so you've got bitgold zcash and others which were precursors to bitcoin so bitcoin was not really an accident it was an eventual coalition point of those efforts really paul graham as silicon valley venture capitalist and founder of y combinator announced in 2008 the insurmountable challenges of accepting online payment which caused the stripe brothers to work on the problem and create a company called stripe which formed the financial infrastructure of payment system used today for businesses on e-commerce on that note being native to the internet means crypto has some unique advantages so this is something we covered with vinay on what are the unique benefits of crypto and why they've become so famous and popular over a short period of time if the governments were sane healthy institutions that everybody believed in nobody would be willing to risk their hard and earned dollars on some weird speculative coin thing produced by an anonymous person on the internet that they're never going to meet that is the last thing you would do if you had any faith in your government the thing which is driving the adoption of crypto is that the governments are run so badly you think you know could they really be any worse than the federal reserve let's give it a try and do you think the current uh let's say institutional adoption is also tied to that same thesis or it's something else now if the american government hiccups let's take it real simply right a lot of the money which is going into crypto is being put into crypto by organizations which will just make a buck and they don't care how it works somebody told me a phrase this morning where somebody who said that you know one of the best traders they knew said they had no interest in bitcoin be bonded to price movement in the next 10 minutes a lot of the institutions which are going into bitcoin right now have absolutely no interest in its political ramifications or its reason for existence or any of that they just don't care it's a commodity they can trade and they can make money on the volatility because they're good at making money on volatility all those folks you know they're piling in and sure enough it will make the number go up and they're all very happy about that and so are the existing holders but if the american government winds up triggering hyperinflation in america you know you've seen mr robot right how

[41:41](https://www.youtube.com/watch?v=vwBysqhyGtk&t=2501s) long would it take american corporations to use a blockchain to stand up an inter-corporation payment currency which would allow them to transact without using the dollar which would be at that point being some kind of spiraling free fall which is by the way essentially facebook's dm that's launching i believe in july this year that gives you a you know strict sense of when the door is going to collapse right i mean this sounds like a joke right but if you had the world's top couple of thousand companies you know the fortune 2000 or whatever it would be or willing to accept a currency that was not a fiat currency for trade with each other remember what i said about encryptor the critical thing is who makes the decision about what you will accept as payment so if they all decide that they're going to accept a cryptocurrency issued by them and their mates as payment you could very easily wind up in a situation where these corporations were dramatically detached from nation state power because they're doing their own banking they're neither onshore nor offshore the governments would lose a lot of access in terms of understanding their financial affairs because they would no longer have the ability to go and look at them because that's you know you're trading in our currency so we can see your books dramatic transformation could occur and why do you think the u.s government would basically sit on its laurels and let that happen this sounds to me like a cartel which is kind of decentralized from government the us government doesn't exactly exist as a centralized entity you have a thing in washington dc which calls itself the government which makes the law but when it comes to implementing the law you know you get out to some place like rural texas and it's not real clear that the stuff that's happening in dc turns into anything says that the federal versus kind of state local government all of that stuff right so but it's not just federal and state government it's power structures which aren't even officially part of the government you know it's mega churches it's oil fields you know if you're the company that owns and runs an oil field all the towns that exist to service that oil field you are effectively the state you get you get to hire and fire people based on their behavior outside of work so if somebody picks a fight with one of your senior executives in a parking lot over a gas pump you know like you're gonna fire that person and that is extra judicial there is no need for government to oversee it the notion that you could simply have the economy detach itself from the state is not that implausible particularly once you've got the internet in play and the way that you do it is the defense contractors cut a deal with the military we'll keep providing you with all the weapons and stuff that you need but you know kind of sort of we've had

[44:11](https://www.youtube.com/watch?v=vwBysqhyGtk&t=2651s) enough of those bushels in washington

[44:13](https://www.youtube.com/watch?v=vwBysqhyGtk&t=2653s) on that thread basically now it's possible to do something like that as you mentioned get a thousand top corporations and having their own payment systems couple of decades ago or you know a century ago it wasn't probably possible right so can you tell us what are the kind of innovations that enable the rise of cryptocurrencies and bitcoin yeah what enabled basically um what enabled it was libertarians wanting to test their theory right and see if it works close enough you know they gave it try they circulated inside and again what makes it grow people choosing to accept it right so you know the answer to all of your questions is the individual decides that they will accept it therefore it grows why do individuals make that decision libertarians made that decision for ideological reasons and then it goes out from there but are there any technological innovations that enabled the implementation of this kind of political will for the libertarians sure i mean that's the inventor of bitcoin in a nutshell was it was the technological implementation that gave the libertarians a currency it wasn't the first though right you've got like cash and bitcoin and others that are trying to do something similar native to the internet so what happens here is three things come together right you get proof of work you get distributed hash tables and digital signatures right so digital signatures plus proof of work plus distributed hash tables equals bitcoin people had put together bits of those systems before but the distributed hash table was kind of the unsung hero of the crypto space until the dht was invented which was pretty early right the dht was the thing that gave us things like napster and kazaa until the dht was invented we didn't have an easy and convenient way of organizing large numbers of computers operating as if they were a single computer once we had that capability a whole bunch of other stuff gets unlocked now we can coordinate the network of computers as if they're a single computer great what are we going to have that computer do well let's do this thing called mining what does the mining do well that's proof of work that's hash cash was the original name for that if i remember correctly once you've got the hashcash system up and running you sort of say well we've got digital signatures to tell people when the harsh cache is going to be transferred we've got this here dht that ties all the computers together into a single state and from there the jump to bitcoin is relatively small the problem that previous systems had was rather than having the dht to tie all the computers together into a single system they'd wound up with things like masternodes they'd wind up with a single computer which is the thing that had the authoritative register and that created a bunch of problems you

[46:43](https://www.youtube.com/watch?v=vwBysqhyGtk&t=2803s) know bitcoin was basically a summation of pretty much everything that we knew about how to do this stuff with computers up until the point where bitcoin was written there wasn't much cryptography lying around that bitcoin didn't in some way utilize it was a very very impressive thing you know the only tragedy is they haven't substantially modernized it in 12 years and that's really causing problems

[47:04](https://www.youtube.com/watch?v=vwBysqhyGtk&t=2824s) adam pascoe were quite interested in emerging markets and how the governments and emerging markets can think about and leverage this unique foundational technology for state building and development we've already seen china launch its own digital currency the digital renminbi we've also seen the indian and turkish governments basically talk about potentially banning crypto but the tech is so fundamental that by banning you miss out on becoming the next innovation hub we've already seen that with the state of new york regulations being so old school and stringent that a lot of crypto companies are going for places like gibraltar to do their icos that's the initial coin offerings so we covered this topic with vinay as well but also equally we covered in how individuals living on those markets should be thinking about crypto as well here we have to ask a really delicate thing which is how concerned are we about the possibility that untraceable digital cash will make it impossible to tax people this is often held up as being the great specter you know even obama talked about this in 2016 he did a speech at south by southwest and he talked about how crypto was eventually going to make it hard for the u.s government to collect taxes and how this might be a bad bad problem practically speaking how concerned are we that it becomes possible for people to hide their income from the government and avoid paying taxes because although you might be able to hide your income from the government it's very very difficult to hide your spending so if the government just put a big fat tax on physical property so cars boats planes helicopters office buildings and houses if the government just puts a tax on those you know six kinds of assets and by the way all those assets are very tightly monitored registered and controlled by the government already the government already has an individual number for every single one of those things then to all intents and purposes you could just tax that stuff and you would have in effect taxed all the wealth that matters so like a general purpose tax something like that you know if i can't see people's income but i can't see their houses and i just tax people based on how big their house is you might get a bit of a fashion for rich people living in tiny tiny little apartments in the middle of nowhere and paying almost no taxes but most rich people will stay exactly where they are right now and they'll just pay whatever it costs to live there so if we tax the big physical wealth

[49:34](https://www.youtube.com/watch?v=vwBysqhyGtk&t=2974s) items if you are rich cars planes houses boats right helicopters if you're really rich that's probably a very substantial chunk of your net worth because even if you're wearing very expensive fashion the vast majority of people the house they keep their expensive fashion and is going to be worth way more than the fashion which is in the house you might wind up with collections of fine art oh you've got 100 million dollars worth of r maybe the government figures out how to tax that stuff in exchange for some kind of insurance or fraud prevention or some other government function you know the police say if you didn't pay tax on the art if it's stolen we won't investigate pretty soon people are going to pay tax on there are or you do it through insurance right you say to the insurance companies the law is if they didn't pay tax on it you're not allowed to pay out anything if it's stolen you could very very very quickly figure out clean mechanisms for taxing people even if you can't see their incomes i don't think cryptocurrency is any kind of substantial threat to the smooth functioning of the nation state even in the poorest countries all that it does is change the mechanisms you use from tax enforcement from chasing people's income to chasing people's assets and the vast majority of those assets are already on state registers like real estate registers so i don't think cryptocurrency is a threat to the tax man and a lot of cryptocurrency people find that very disappointing oh i thought we were just going to be able to hide all our money you can hide your money all you like but you can't enjoy your money after you've hit it well that's no fun yeah that's that's right the government will just talk to you for having fun they can't tax you for having the money but they can tax you for spending it and they'll get you in the end so just to get this clear so what you're saying is it will be fairly easy to tax high value items so that layer of spending and then the low value items you know the shops the restaurants and so on they simply won't be allowed to take these you know whether that's zero knowledge cryptocurrencies something along those lines so then that is also safe as well my suggestion is the government doesn't really care you know i mean if you're gonna go out there and try and raise the same amount of money for the state in a position where you can't see people's financial transactions you come up to a restaurant you calculate the number of seats in the restaurant and then you charge them a fee we don't care how much money you're taking but this is the seat tax if you have a restaurant and it has 50 seats you have to give us this much money every year if you can't afford it you go bankrupt your problem to ours okay that's really interesting so that basically suggests that we're gonna move into an entirely new system of taxation and that also ties in with the governance question then right my suggestion is there is no fundamental

[52:04](https://www.youtube.com/watch?v=vwBysqhyGtk&t=3124s) reason for the governments to fear cryptocurrency as a threat to their ability to tax people the kinds of people that you wouldn't care for people like warren buffet warren buffett lives in the same house that he bought something like 50 years ago and apparently has dinner at mcdonald's once every two weeks hey that's warren buffett right there's only one warren buffett jeff bezos was it gates bezos right just commissioned a 500 million dollar yacht that's the thing you tax warren buffet okay he lives like a monk fine he's not going to pay much taxes he's weirdo okay fine visas have just commissioned a 500 million dollar you are going to be able to tax that y'all it's not a hard thing to find once we take away the idea that cryptocurrency will starve the governments of their ability to tax effectively my suggestion is at that point the governments have absolutely nothing to fear from cryptocurrency it is largely irrelevant to the government because if it doesn't affect their ability to tax what else is there oh well affects their ability to enforce law people will launder money through it most of the time you're concerned with money laundering because people are avoiding taxes thing one we just cover taxes the other thing is you're gonna intercept people's financial arrangements as they're paying each other for doing illegal things and that you're going to arrest them by following the money i will admit properly handled cryptocurrency makes that a bit harder absolutely agreed however the government has more or less total surveillance of everybody's lives all the time because they've got control of the internet in most countries and at that point if they can't figure out when people are engaging their criminal conspiracy i don't think having access to their banking records is really going to help them that much so proactively designing and new taxation policy for example if i'm a statesman in bangladesh so what else what else do you think i don't think they have to proactively design it i think they just have to accept that it's not a threat to them if it ever begins to cause problems they can change how they tax they don't have to change how they're taxing until it's big enough to start causing problems you know okay this is causing problems we need to reform how we tax okay fine right once we say this is not a threat to the government's ability to govern because taxation can shift and they'll be able to collect the same amount of taxes probably in a more fair way on the other side of the criminal conspiracy side in all probability they've got much better ways of getting the information in the banking system anyway then we can say so given that we've agreed you don't have to be afraid of this stuff what can you do with it suddenly we're in a whole new domain because you know everybody acts as if cryptocurrency is a scary thing that governments are meant to be afraid of because this was the sort of public relations nonsense that went along with the early adoption of bitcoin bitcoiners got into bitcoin worth because they wanted to be able to pay

[54:34](https://www.youtube.com/watch?v=vwBysqhyGtk&t=3274s) wikileaks after wikileaks was kicked out with the visa system and you know bitcoin was a way of funding julian assange's insurgency and it was a very effective way of funding julian assange's work and you can see that the state found another way of cutting this on job for mayor you know not very nice people to stay he's not sure julian assange so once we get over the idea that there's anything to be afraid of in these technologies then we say what are they good for for a government and if you're a small government in the developing world country probably the biggest single problem that you have is structural corruption so you know here we've got a payment system that leaves a perfect record of everywhere the money has gone hey all government spending is going to go over the government's own blockchain the way that it works is the next time you come in for your driver's license you can optionally bring in your crypto wallet the government will verify the address on your crippler wall is correct by making a very small payment or you better you make a small payment to them and then the government will register your crypto wall address as being this is your crypto wallet address and now the government can make payments to you directly to your crypto wallet rather than going through the crappy old banking system we're trying to give you cash how much easier did life just get in terms of distributing funds to the poor super simple right it's just not as hard as people make it out to be so corruption taxation what else do you think states you think about leveraging blockchain or crypto let's go to this question of like what are the real problems that states have corruption is a multi-multi-tiered beast it's not just about following the money it's about following the things which are meant to be done for the money i mean you know the kind of classical sort of developing world scam where you know somebody builds the government a hundred million dollars for building a highway and then they build fun you know 15 kilometers at either end close to the big cities and the rest of it is just a muddy washed out road two years after it was built yep you've seen this scan you know that scam if you can track where the money went you know you can see the payment that went to the contracting company didn't go to the sand and gravel company and it didn't go to the tarmac company and it didn't go to the mechanical digger company it went to the yacht company and it went to prada yeah okay i have a problem here right so imagine that the government has a roster of people that are permitted to receive government money and the roster of people that are allowed to receive government money that doesn't include prada and the yacht guy so it does include all the people who are doing wage labor in the gravel pits and it includes all the people in the tarmac company and it includes the mechanical digger firm so we give you a hundred million dollars to go build this road

[57:04](https://www.youtube.com/watch?v=vwBysqhyGtk&t=3424s) you have to get all the people you want to give that money to registered in our system or it will become impossible to transfer the money to them can you imagine how different the developing world would look if this system was in place already can you imagine how different the world would be if you were just in a situation where it was impossible to steal money from the people of the third world third world developing world god i'm really showing my age here right poor countries let's say what we really mean so if it becomes impossible to steal from the people of poor countries because the only way that money is moved around on government contracts is just a series of people that are already authorized and if you're not authorized the money physically can't enter your account and we've got a perfect audit trail left of every penny in the systems how much better off are the poor going to be in poor countries yeah and this authorization logic can be designed on the chain basically versus your current financial system well i mean you know you have the government providing a payment rail and the government will only pay people that it's authorized to receive payments of that kind right so you are bob's gravel company and you say i've got a contract here to deliver 500 metric tons of gravel for this road project i need you to put me into the system as an authorized vendor they verify that you actually exist they verify you pay your taxes they verify you have a bunch of employees they put you and all of your employees in the government system right now when the money moves the government can track it penny by penny right through every one of your employees right through hey they're doing a lot of overtime shouldn't you hire some more people and you say but isn't this massive government intrusion yes weirdly enough it is massive government intrusion but its government intrusion on work that the government are paying for yeah yeah i guess we've got to think about disciplined government versus small government you know sometimes it coincides sometimes it doesn't but discipline government is where you're trying to get to right that's right it's a tool for the governments to be able to control what happens to the money that they spend that makes sense and since you talked

[58:56](https://www.youtube.com/watch?v=vwBysqhyGtk&t=3536s) about poor countries and poverty related initiatives i know the charity space it's quite prone to these kind of you don't know where your money goes when you basically pay a hundred dollars right so can you speak about how blockchain is currently used in the charity space and what's the problem and how can it help i think it's also worth prefacing that this is actually what vinay does at Mattereum and this notion of organizing the physical world that is capable of solving so many global problems whether that's you know the corruption that's happening in government or the charity world but also beyond that just problems related to sustainability and maybe we can dig into that a little bit as well sure in terms of how you would use blockchain in the charity space just use it to give money directly to poor people get rid of the charities completely if you could get an identity register of who are the poor people that have crypto wallets and you can make sure that this wallet belongs to a person that's inside the demographic you want to donate money to just give the money directly to the poor people why would you do it any other way what possible reason could there be to have this vast age bureaucracy in the middle have you ever been to geneva i have not now yeah i have arthur when you were in geneva how rich does jesus look as a city it's beautiful and standard of living there would you say it's closer to new york than new jersey i haven't been to either of those oh i see well there you go let me tell you right geneva is like the most expensive parts of new york and the whole city is that way it's a phenomenally expensive place to live and an enormous amount of the geneva economy is the money that's pouring in from all the eight bureaucracies that rageq in geneva and have a whole bunch of staff that are paid 115 000 a year tax-free the international system is rotten to the core and you know like you want to ask what blockchain would do you figure out who the poor people are that have blockchain wallets and then you give money to them directly and then you can account for every penny because you can see how the money is spent afterwards okay makes sense tonight does this sort of tie into the idea of ubi it ties very closely to the idea of ubi so universal basic income over the blockchain i think is one of the world's just best ideas because the problem with ubi is everybody's afraid that if you start giving people basic income what will happen is the landlords will jack up the rents and then all that you'll be doing is paying a direct subsidy to the landlord and the people providing broadband and you know similar so if you've got a basic income that runs across a blockchain you could follow the money exactly to figure out whether or not that's happening and if you do see it happening the evidence will be on chain and completely incontrovertible and that is a game changer because the

[1:01:26](https://www.youtube.com/watch?v=vwBysqhyGtk&t=3686s) ability to do ubi with ultra close monitoring of what's happening means if you begin to see companies hoovering up the ubi in this kind of monopolistic way you have the opportunity to go in and stop that almost as soon as it starts a completely different way of doing this thing is possible than just handing people cash because if you hand them cash without the ability to monitor where the cash winds up the possibility is always going to be there's just a gigantic cash hoover run by the establishment of police they just come in and steal everything and the following

[1:01:55](https://www.youtube.com/watch?v=vwBysqhyGtk&t=3715s) question from all of this is if you are a person living in those let's say poor countries right what steps can you undertake today rather than like you know wait for the government to you know adjust its policies or wait for something like ubi to happen what can you start doing today for folks who are living in poor countries literally the starting point is to start learning about these technologies and figure out how to use them right now most of these technologies are very very broken because of the enormously rapid growth that's happened in the last year we haven't really caught the technology up so right now it's costing more money to do an ethereum transaction than most folks in poor countries are earning in a year the systems are just destroyed by rapid growth a lot of work is going into getting scaling solutions so that they will begin to operate efficiently again and it'll be cheap to make payments like it ought to be and at that point these things will begin to stand up again there are a bunch of blockchain systems which are still relatively cheap because they used proof of stake rather than proof of work you know i don't know what i would recommend of those maybe avalanche getting to know the lingo reading about them understanding their technologies getting wallets set up you know on the blockchains which are currently not broken by growth all of this stuff is sensible or we practice it's particularly true in countries where the economies are unstable so you know there are all these stories about people who were basically feeding their families by bitcoin mining in venezuela you know people who are in economies that have a risk of hyperinflation storing some wealth in the form of crypto assets is not a bad plan it's also not necessarily a good plan because those assets are inherently very volatile but there are currencies like usdc which is a dollar denominated coin which is backed one to one by us dollars so if you were in a place like venezuela when you bought bitcoin you'd be very rich one day and very poor the next you know if people buy bitcoin at the current valuation of whatever is 55 000 that's probably going to go down a long way before it hits 100 grand i don't know that for sure but it's a reasonable guess based on previous experience whereas if you bought something like usdc or you bought a gold product you would have gotten your wealth outside of the national economy outside of the zone of control of the government without having to do anything particularly difficult or scary on the way and is that fair to say that you know a lot of this blockchain tag essentially is creating a global economy rather than many different local economies so that individual who starts participating in ave or staking you know their tokens in one of these protocols

[1:04:25](https://www.youtube.com/watch?v=vwBysqhyGtk&t=3865s) you name it buys usdc or die stablecoins and is now part of this global financial system it is certainly true you're part of a global financial system in that you can pay anybody in the world who has a wall and that is an incredibly powerful starting point but it's only a starting point because paying them is only one half of the equation the other half of the equation is that they need to be able to send you something of value in return so although we have the beginnings of a genuinely global system where you can have any person pay any other person payments is only one half of the equation the other half of the equation has to be moving goods and services and this is the problem that i'm working on how we get goods and services onto the blockchain in a way that complements existing payments infrastructure right and maybe we could dig into that a little bit here what my company Mattereum does is we provide a standard format for documenting valuable things and a valuable thing you know it could be a house it could be a car it could be a diamond the way that we document these assets is we don't just write down what they are we write down what they are with an or else clause i tell you that this is a one kilogram gold bar produced by valcambi with the following serial number and if that is not true i will pay you um 75 000 right now at that point if i'm the buyer of the bar and i trust that there is a reasonable probability that this person will pay me if the bar is fake i can buy the bar with total safety even if the bar is on the other side of the world and that system is not theoretical we brought that system up to speed literally today i think we got that thing started might have been yesterday now that that's online there are nfts you can buy which directly correspond to the legal right to pick up a gold bar in singapore or to have them sell the bar on your behalf and send you the money and that is a game changer you know that is not a thing which has existed before right and i think it's worth mentioning that that same concept you can then take and apply to all kinds of other physical assets any physical thing or indeed some non-physical things so if you want to do something like intellectual property licensing we can do that for an ip license we can do it for a patent license because that process of documenting what it is that makes something valuable applies to any asset of value it's not just about the assets which are physical as long as there is something like an ip license that you can document you you've got the right to sell the license at that point we can do it and that is a game changer let me tell you right so essentially anything that can be tokenized will be tokenized and anything that has value will be able to be transacted or you

[1:06:55](https://www.youtube.com/watch?v=vwBysqhyGtk&t=4015s) know used in the financial system much more fluidly than it is today absolutely right much much more fluidly is the key if you take something like real estate i don't foresee a world in which 98 of the world's real estate is inside of a blockchain system anytime in the next 20 years i think it will take a really long time to get to you know the vast majority of the world's real estate being in those systems because most of the world's real estate doesn't need to be very fluid there's not that much of a need for having most real estate be in this kind of hyper liquid form but in any country in any jurisdiction you do need some real estate to be in this hyper liquid form otherwise when something goes wrong in an old style real estate deal you've got no options to quickly switch in another piece of real estate instead and then complete the transactions plan and that is a really important capability that is a game changer so imagine that you're trying to buy a house in some place like new york right you know the transaction goes wrong right now you cannot get another piece of property into that transaction in less than three weeks or a month or five months if it's in the uk you know suddenly deals gone bad that house is no longer available we found some terrible problem with it on the last structural engineering report i got the mortgage lined up i've got a buyer for my existing house i need a place tomorrow well you know you take your three-quarters of a million dollar mortgage you turn it into usdc you put it into a smart contract and you click on the house that you want boom you are now the owner of a brand spanking new property and that notion that you'd have a reserved pool of properties that were ready to change hands very quickly if i buy a house and i'm having a hard time selling it i put it into that reserve pool by paying the necessary cost of getting the thing turned into an nft and then i plug that nft directly into that liquid market and i could live in the house right up until the moment it's sold can you imagine how different the world looks for people who are buying property if you know that you can always pay a couple of percent more on the deal for something that will settle in literally 15 minutes so the thing which

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Continues in https://guptaoption.com/texts/768-3.md (part 3 of 3).
End of [768] #03 - Vinay Gupta : History of Money, Foundations of Crypto & Applications for Emerging Markets, part 2 of 3. Its connections are at the top of this file; the map is https://guptaoption.com/llms.txt.