Calm

hi this is charles hoskinson broadcasting live from warm sunny colorado always warm always sunny sometimes colorado so today is november 18th 2021 and it's been a long day a lot of meetings today good news on all the fronts the engineers are doing their job business people doing their job and it's just yet another one of the days of work next week is thanksgiving and i've just been kind of looking at a lot of my reports and i have all kinds of notes and other things i've taken but we look at a lot of sentiment scoring and sentiment analysis and lately i've seen unusually high amount of people that are obsessed with things like price or they say stuff like oh well everything's failing the sky is falling and there just seems to be an utter lack of perspective in this space so from time to time i do make videos last year i made one right after the markets completely collapsed because of covid and everything was down like 30 percent 40 today and there's blood in the streets and people got so worried and there was a call to fundamentals in that presentation in that speech and i basically said to people calm down chill out it's okay you see cryptocurrencies are a very unique moment in human history and i think it's really important especially for new people who have kind of fair-weathered their way into the industry to understand what that moment is because perspective has been lost and as a consequence calm is no longer there it wasn't too long ago that there was this era of calm monetary policy stable and persistent inflation about two three percent per year deficits weren't too bad national debt wasn't too unmanageable gdp growth was looking pretty good things were stable but underlying all of that was this idea that there was nothing constraining the excesses of government and there was an incestuous and still is incestuous relationship between government and corporations all across the world and what's happened since the year 2000 to 2021 is we have seen an astronomical increase in the amount of money in circulation justified by kinsey and economics and modern monetary theory to the point where in the united states in particular half of all the money in circulation has been printed in the last two years we are passing bills in the us the infrastructure bill and probably the build back better program that cost more money than all of the money spent by every u.s president from george washington to george h.w bush combined in one fiscal year a personal example anecdotal example my ranch up wyoming i bought a bunch of propane fuel tanks for about twenty five thousand dollars each big big field tax companies sold them to me five months later we're having trouble getting labor to barium company that sold them to me reached out to me and said hey we'd like to buy some of those tanks back from you to resell them we'll pay you 35 000. five months price went up 10 000. that's the wholesale everything's up timber is up steel's up there's real inflation probably over 20 percent this year the supply chains are so screwed up that i saw the other day the spot price of west texas intermediate oil negative thirty seven dollars had to pay people to take it some people california on the other side of supply chain are paying over six dollars a gallon for gasoline all-time high on one side of the supply chain you have to give it away on the other side of the supply chain it's at an all-time high these are not functioning markets there's a lot of problems here and some people say these are transitory or some people say these are structural you see things the great reset be pushed upon us you'll own nothing and be happy things like capitalism has failed it's time for a new system and usually it's some sort of massive increase in government spending and complete restructure of the economy where the factors and means of production are owned by the few as custodians of them for the many so the point of cryptocurrencies have been it's opt out nation states are starting to do it like el salvador and more will come and each and every person who enters the cryptocurrency space they're opting out in their own way and the problem is we've never really seen this before on a global scale and so what's happened is it's created all kinds of difficult markets where pricing things are at many times really hard to understand for example we have dogecoin and they ship shibuya stuff and they have accumulated technically tens of billions of dollars of value but there's no real use or utility outside of the fact that there's a social network behind them the adherence of these things would argue that these social networks themselves represent the value and therefore that's all you need old school people like me say you have to have a real fundamentals real transactions real commerce a potential for use and utility a path to these things and a view on how these things are going to work with the world change the world and maybe we're both right maybe we're both wrong who knows the reality is though that millions of people across the united states and collectively tens to hundreds of millions across the world have entered the cryptocurrency space and as a consequence of entering that space negative and positive it is changing the structure of the world economy to the extent that it's unlikely we can ever put pandora back in the box box is open all of these things have come out people expect instantaneous liquidity people expect trading markets that trade 24 hours a day seven days a week there's a darwinian nature to technology now there's a lot of copying evolving iteration every year we will see thousands of cryptocurrency related projects launching around the world without end regardless of economic conditions it's also created a distortion about expectations of return and many regulatory bodies have warned people about this but it is unrealistic if there's a hundred x in something to expect that to happen every single year it just can't math doesn't work that way but as a consequence of local returns people have developed very unhealthy views on how long things should take and where value comes from and many people are starting to subscribe to the greater idiot theory of get in fast get out fast and somehow you'll have this great life and what's been missed is the fact that the system they're exiting back into is fundamentally sick and unhealthy if we continue the united states because we are the world reserve currency on this disastrous monetary policy there is a very real possibility of a default or hyperinflation or both dragging the entire world into the greatest depression and has ever seen that's not hyperbole that's not an idle threat it's a real reality which is why when you look at things like land purchasing the purchase of gold guns ammunition emergency storage the exodus of capital into other assets and the fact that magic internet money is collectively worth more than the bottom 100 economies of the world added together after just 12 years of coming out it is a very real possibility okay so that is where we are all at now we can vote and we can try to build structures and try to be resurrect and transform and evolve the legacy system or we can opt out and go into the new system or perhaps pursue a hybrid strategy but the very definition of money the very nature of money the very question of should nation states be entrusted for the production of money can they be entrusted for the production of money in a world with politics and social media and a world that's globalized these are the real things that our industry is facing every day now cardano in particular we built this project with the aim of a long term outlook decades and we built this trying to provide a path to provide real meaningful solutions which are fair for as many people as possible and that are open and transparent and also work every single category whether it be scalability we have pro things like pipelining and input endorsers and all these other optimizations that are coming quickly to enable us to scale to millions to billions of users on the governance side catalyst is growing and it's the largest decentralized organization in the world containing over a billion dollars of assets to distribute to projects and then all those metrics are going at a rapid rate but if you look at a five-year a 10-year a 15-year or 20-year package we really feel that there's a strong possibility cardano could be the back-end of many nation-states running billions of transactions on a daily basis running national elections being the property register of small nation states medium-sized nation-states the backbone the root of trust of the identity systems of the future and the biggest preserver of human rights the world has seen now i don't know what that's worth i actually don't know how value works anymore especially when it's in dollar denominations because things are worth tens of billions of dollars that make no sense that they're worth tens of billion dollars but i do believe if you have a network with billions of people using it that network is too big to fail for humanity and as a consequence we'll be here forever or at least until something else replaces it and it's really hard to replace something that has billions of adherents and users just look at the internet how would one build a new version of that we've tried for four decades unsuccessfully there's a stickiness about these types of network effects so i think that people need to calm down and they need to return to first principles and take a look at the philosophy of the space and take a look at where the human race is at and understand that the avaricic pursuit of an arbitrary unit of value whatever that might be euros dollars etc etc is not meaningful in any sense of the word it isn't the point of the cryptocurrency industry and that all these fair weather people that have entered in with 49ers mentalities they're not going to do well the point of the backbone projects like bitcoin like cardano and others in this industry including ethereum are to pursue the future and try to guide humanity towards better ends for us all that's what we're after that's what we seek those are the kpis upon which i hold myself accountable and this community for the most part holds itself accountable those are the things i care about and i do care about value from the perspective of providing maximum value to as many people as possible which is why we pursue the developing world it's why we have a b to b to c strategy and a b to g to c strategy where we bring corporations large companies large governments they bring tens of millions of people at a given time it's why we care about a holistic approach like having a decentralized innovation system a decentralized brain for research it's why we care a lot about metadata and identity and other things because these are the things that are required to make applications useful and the bedrock that we have laid with the research we've done we have a clear line of sight to solving the problems that are required for a system to work at a scale of billions of people almost every one of our competitors just simply don't that's a fact and they say they do until they tell you they have to build another version of the software or some miracle will come or it's temporary centralization or would they have to restart the network or these things and they have great marketing and they have great people to convince you of such things and then they die slow heat death after a period of time we know our stuff works because we wrote the proofs we went through peer review we took the time to do things right input endorsers for example can improve the throughput of the base ledger of cardone by a factor of 20 to 40 in our current benchmarks we're looking at and that came in a paper in 2016.