A History of Bitcoin’s Predecessors, Dollarization, and Stablecoins with Nic Carter

Our guest for this week’s episode is Nic Carter, Partner at Castle Island Ventures and Cofounder of Coinmetrics.io. In this episode, we dive deep into some of Nic’s current cryptocurrency obsessions. We start off covering the history of Bitcoin’s predecessors, leading to an interesting realization that the crypto industry today may be forgetting the lessons drawn from previous attempts to create a private money. We then shift the conversation to stablecoins and the implications of their continued growth. In doing so, we highlight that stablecoins today are virtually no different than reserve-backed currencies of the past. We end the conversation on an interesting theory that, contrary to popular belief, crypto may actually be good for the dollar. We explore different cases of dollarization and the heterogenous mechanisms by which they’ve emerged. Tune in for all of that and more!

“Bitcoin is sufficiently decentralized so far that it’s avoided this kind of key man risk – the ability for the government to raid the offices of someone somewhere and shut the system down.”
“You could store a billion dollars’ worth of Bitcoin in a single unit public-private key pair. This allows for extremely strong ownership, especially in countries where the banking system doesn’t work very well.” Key Points From This Episode:

• How Nic became Fidelity’s crypto analyst after a brainstorm with former ARK analyst Chris Burniske.
• Bitcoin’s most underappreciated property: ‘auditability’
• The birth of Coinmetrics
• Anonymity, reliability, and the distinction between digital cash and electronic money.
• Bitcoin is the culmination of disparate prior technologies.
• A history of Bitcoin’s ideological predecessors: E-Gold and Liberty Reserve.
• The fundamental role centralization played in Bitcoins predecessors’ downfalls.
• The appeal of fiat-backed stablecoins.
• Why it is unlikely that Ethereum will unseat Bitcoin, and Libra’s loud ploy to overthrow centralized currency.
• Dollarization: benefits, adoption patterns, and how successful iterations are bottom up.
• Why crypto is potentially good for the dollar due to the dollar’s desirability.
• How credibility, not just technology, affects the adoption of new payment systems.
• The benefits of seedless mobile wallet setups.