Throughout a current interview, Tesla and House X CEO Elon Musk shared his newest ideas on cash, cryptocurrency usually, 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 (kind of) that the best cryptocurrency for Mars is Dogecoin, Mars must have its personal fully separate cryptocurrency (i.e. one not tied to Earth):
“Effectively, we have to have a special foreign money as a result of you may’t synchronize attributable to velocity of sunshine — not simply… As a result of… Mars… the closest strategy is 4 gentle minutes away, roughly, after which at first strategy, it’s roughly 20 gentle minutes away, possibly slightly extra.
“So can’t actually have one thing synchronizing, you understand, if you happen to’ve bought a 20 minute velocity of sunshine problem. If it’s bought a one minute blockchain, it’s not going to synchronize correctly. So I don’t know if Mars may have a cryptocurrency is a factor, however most likely. Appears doubtless, however it will be some sort of localized factor in Mars.“
Musk subsequent talked about cryptocurrency usually, calling it an “fascinating strategy to lowering the error within the database that known as cash.” He went on to say:
“You recognize, I feel I’ve a reasonably deep understanding of what cash really is on a sensible everyday foundation due to PayPal… Proper now, the cash system –really for sensible functions — can be a bunch of heterogeneous mainframes operating outdated COBOL.. Pity the poor bastards who’ve to take care of 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 enhancing privileges on the cash database they usually use these enhancing privileges to make more cash every time they need. And this will increase the error within the database that’s cash.
“So, I feel cash ought to actually be considered via the lens of data idea… and so it’s you’re sort of like like an web connection like what’s the bandwidth? You recognize, took complete minimize fee. What’s the latency generator packet drop? You recognize, errors in errors and community communication.
“After which what system, from an info idea standpoint, permits an economic system to perform 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 area.“
Musk subsequent talked about Bitcoin and its disadvantages (vs one thing like Dogecoin) as a type of fee:
“There’s a elementary problem with Bitcoin in its present type 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 downside, which is retailer of wealth or an accounting of relative obligations, I suppose. However it isn’t helpful as a foreign money, as a day-to-day foreign money…
“A part of the rationale why I feel there’s some benefit to Dogecoin — though it was clearly created as a joke — is that it really does have a lot larger 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 wished to do a Bitcoin transaction, the worth of doing that transaction could be very excessive and so you can not use it successfully for many issues. Nor might it scale to the next quantity…
“When Bitcoin was began — round 2008 — the web connections had been a lot worse than they’re at the moment, like an order of magnitude…. I imply there’s the best way method 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 feel there’s some worth to having a linear improve within the quantity of foreign money that’s generated… If a foreign money is just too deflationary… there’s a reluctance to spend it… But when this some dilution of the foreign money occurring over time, that’s extra of an incentive to make use of it as a foreign money.
“So, Dogecoin, type of randomly, has only a mounted variety of cash… that generate yearly. So, there’s some inflation, nevertheless 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 foreign money, however I feel it really is simply essentially higher than anything I’ve seen — simply accidentally.“
The views and opinions expressed by the creator, 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 danger of monetary loss.