Throughout a current interview, Tesla and House X CEO Elon Musk shared his newest ideas on cash, cryptocurrency basically, Dogecoin, and Bitcoin.
His feedback got here an interview for episode #252 of the Lex Fridman podcast. Under are some highlights from Musk’s feedback throughout this glorious interview.
Fridman and musk began this portion of the interview by speaking concerning the planet Mars and that regardless of Musk’s tweeting (roughly) that the best cryptocurrency for Mars is Dogecoin, Mars must have its personal fully separate cryptocurrency (i.e. one not tied to Earth):
“Nicely, we have to have a unique forex as a result of you’ll be able to’t synchronize attributable to pace of sunshine — not simply… As a result of… Mars… the closest method is 4 gentle minutes away, roughly, after which at first method, it’s roughly 20 gentle minutes away, possibly a little bit extra.
“So can’t actually have one thing synchronizing, you understand, if you happen to’ve acquired a 20 minute pace of sunshine subject. If it’s acquired a one minute blockchain, it’s not going to synchronize correctly. So I don’t know if Mars could have a cryptocurrency is a factor, however most likely. Appears probably, however it will be some form of localized factor in Mars.“
Musk subsequent talked about cryptocurrency basically, calling it an “attention-grabbing method to lowering the error within the database that is named cash.” He went on to say:
“You understand, I believe I’ve a fairly deep understanding of what cash really is on a sensible each day foundation due to PayPal… Proper now, the cash system –really for sensible functions — is known as a bunch of heterogeneous mainframes operating previous COBOL.. Pity the poor bastards who’ve to keep up that code…
“Banks are nonetheless shopping for mainframes in 2021 and operating historic COBOL code. And, you understand, the Federal Reserve, most likely has even [something] older than what the banks have…. And so the federal government successfully has modifying privileges on the cash database they usually use these modifying privileges to earn more money every time they need. And this will increase the error within the database that’s cash.
“So, I believe cash ought to actually be seen via the lens of data concept… and so it’s you’re form of like like an web connection like what’s the bandwidth? You understand, took complete lower fee. What’s the latency generator packet drop? You understand, errors in errors and community communication.
“After which what system, from an data concept standpoint, permits an financial system to operate one of the best and you understand cryptos are an try to cut back the error in cash that’s contributed by governments diluting the cash provide as mainly a pernicious apprenticeship filled with taxation...
“Simply consider cash as a database for useful resource allocation throughout time and house.“
Musk subsequent talked about Bitcoin and its disadvantages (vs one thing like Dogecoin) as a type of cost:
“There’s a elementary subject with Bitcoin in its present kind in that its transaction quantity could be very restricted and the latency for confirmed transactions is just too lengthy — for much longer than you’d like. So, it’s not it’s really not nice from a transaction quantity standpoint or a latency standpoint.
“So, maybe, it’s helpful to resolve a facet of the cash database drawback, which is retailer of wealth or an accounting of relative obligations, I suppose. However it isn’t helpful as a forex, as a day-to-day forex…
“A part of the rationale why I believe there’s some advantage to Dogecoin — regardless that it was clearly created as a joke — is that it really does have a lot increased transaction worth functionality than Bitcoin and the prices of doing a transaction — the Dogecoin price — could be very low.
“Proper now, if you happen to needed to do a Bitcoin transaction, the value of doing that transaction could be very excessive and so you can’t use it successfully for many issues. Nor may it scale to a better quantity…
“When Bitcoin was began — round 2008 — the web connections have been a lot worse than they’re in the present day, like an order of magnitude…. I imply there’s the way in which approach worse, you understand, 2008. So having a small block measurement and an extended synchronization made sense in 2008, however in 2021, it’s like comically low…
“And I believe there’s some worth to having a linear improve within the quantity of forex that’s generated… If a forex is just too deflationary… there’s a reluctance to spend it… But when this some dilution of the forex occurring over time, that’s extra of an incentive to make use of it as a forex.
“So, Dogecoin, kind of randomly, has only a mounted variety of cash… that generate yearly. So, there’s some inflation, however it’s a hard and fast quantity. So, the share of inflation will essentially decline over time. I’m not saying that it’s like the best system for a forex, however I believe it really is simply basically higher than anything I’ve seen — simply accidentally.“
Disclaimer
The views and opinions expressed by the writer, or any individuals talked about on this article, are for informational functions solely, and they don’t represent monetary, funding, or different recommendation. Investing in or buying and selling cryptoassets comes with a threat of monetary loss.
