Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Congress is hard at work getting the Genius Act pass
and across the President's desk as quickly as possible. It's
with good reason, because regulatory uncertainty in this country has
pushed way too much stable coin activity overseas over the
last few years, and once the Genius Act is enacted,
it's poised to vastly expand the use of stable coins
(00:23):
as a digital payment system for millions of our fellow Americans.
It will also protect coin holders and eject further transparency
into the market. And let me be emphatic on one
other point. In this administration, we do not think that
stable coins threaten the integrity of the United States dollar.
Quite the opposite. In fact, we view them as a
(00:45):
forced multiplier of our economic might.
Speaker 2 (00:49):
The Genius Act is with the US Senate at the moment,
and if it passes with the filibusta, we will see
a regulatory framework for stable coins how they're supposed to
operate in the United States of America. This is very
good for the cryptocurrency industry overall, but there could be
some really strong overreach from the government when it comes
(01:13):
to control of those stable coins. We're going to go
into all of this in this episode. Let's get to
it now. For those that are familiar with stable coins,
they're essentially the cryptocurrency version of fit based currency. So
if you're trading on a decentralized exchange or a centralized exchange,
or just transferring value from one person to another, you'd
(01:34):
use these stable coins to do so. And there's plenty
of them. So it's a massive market with potential of
trillions of dollars transmitting through these stable coins on a
daily basis. But it lacks that clear regulatory framework so
that people understand how you're supposed to issue them, how
they're supposed to be backed one to one with US
(01:55):
treasuries or US dollars, whatever it might be. So that
doesn't have that regulatory framework until maybe very soon with
this Genius Act. Now, the Genius Act is a proposed
built where stablecoin issuers can apply for a single issuer license,
So this is federally controlled, takes away all that paperwork
that you normally would need going state by state, and
(02:17):
it is a painful process to get your licenses in
every state in the US. But this single license to
allow you become a stabacoin issuer if you follow or
with protocols. So in theory, this will reduce the friction,
simplify compliance, and could promote innovation by making it easier
for serious projects to launch nationally. And that sounds really good,
but there's a catch. Participation is optional. Issues can still
(02:40):
go the traditional route state by state licensing. Check out
this article here from the Wall Street Journal that came
out last week. Major banks JP, Morgan, Bank of America, Citygroup,
and Wells Fargo are reported in early stage talks to
launch a joint stable coin. They're doing this through entities
like Early Warning Services, the company behind Zelly, and the
(03:03):
clearing house which runs real time payments in the US.
When do you ever see major banks working together? Only
if there's a big incentive for them to do so.
And they're worried because stable cooins could siphon away deposits
and transactions, especially under the pro crypto administration, and if
tech companies or retailers jump into that's even more pressure
(03:25):
on the banking model. So the banks are responding to this.
They want in, but more importantly, they want the control. Now.
The way that the banking system works at the moment
is that it uses something called fractional reserve banking. So
fractional reserve banking is a system in which only a
fraction of the bank deposits are required to be available
for withdrawal. Banks only need to keep a specific amount
(03:46):
of cash on hand and create loans from the money
that you deposit. So fractional reserve works to expand the
economy by freeing up that capital for lending. So if
that feit currency isn't in the bank's possession, they can't
loan out that money to expand the economy, and they
can't generate any more revenue for themselves. So it's in
their best interest to create that stable coin so they
(04:07):
have control over that and they can still loan out
money and generate revenue. Now, there is also a big
issue with centralization of a particular stable coin under this
federal licensing. Now, imagine that you were a big stepcoin
issuer and you had this particular political alignment that didn't
fit with the current administration whatever it might be. Mybe
(04:28):
ten years down the track and they decide that you
can no longer issue that particular stable coin. They take
away your license, and that stable cooint is essentially can
put and any of the users under that particular stable
coin will be affected accordingly. So there is that massive
risk of that level of centralization that could possibly happen
there too. And you can even take that a step
(04:50):
further down to the personal level. Maybe you're a holder
of a particular stable coin and you're using it to
transmits funds or whatever, but you said something on social
media and that particular administration didn't like what you said.
They could possibly freeze or restrict movement of funds from
your account, so that could be possible as well. It's
(05:12):
kind of one step away from a central bank digital currency,
which is something that you should be really alarmed about,
because they can seize, they can freeze, they can do
anything they want with your current balance of stable cooin,
whatever it might be. So it could be one step
away from that type of scenario and that is definitely
something that we don't want in the decentralized economy. And
(05:34):
if something like that happens again, then cash would be
the preferred currency, the ThReD fit currency for trade. And
in some countries around the world they're making cash really
hard to obtain, like in Australia, they're closing down more
and more ATMs, they're charging you fees for taking out
cash and even asking you questions in regards to what
you may be taking out that cash for. So there's
(05:56):
a lot of rules around it, and it's making a
lot harder for people to obtain cash. So this is
something a lot of people are taking note of. Now.
One of the things with a center back digital currency
is the idea of programmable money. So if they put
in a monetary policy that says we need to increase
spending within the economy, they could do something like, all right,
(06:16):
you have to the end of the month to spend
ten percent of the funds in your savings or else
we'll just take it away and spend it for you.
And they can program that in to the money because
it's run by smart contracts, and state that, okay, if
this money balance doesn't reduce by ten percent, then we
will just take that ten percent and they could tax
(06:37):
that money from you and use it in the economy
to stimulate spending. So there's a lot of things that
they can do with a CBDC if that ever does pass.
And I'm very worried about these type of CBDCs. Now,
let's go back to the STABQUN regulation and what big
tech might do. Now, there's a couple of articles that
are circling around at the moment saying that big tech
(06:57):
could step in and become issuers of stable coins themselves.
A lot of these big companies have massive reserves of
US currency and they could deploy it anytime they want,
but they could also deploy their own stable coin and
get users on their platforms to use that stable coin
for transferring funds reduce their costs. They don't have to
use the party payment system, so they are their own
(07:18):
payment to payment gateway, which would reduce costs and increase efficiency.
So it's a good idea for them to actually do
something like this, But it also reveals to those companies
what you're spending your money on, so this is a
big invasion of privacy. Let's say you're using Apple pay
and you're now using the Apple pay dollar whatever it
might be called. That sounds like a good name to me,
(07:41):
But now they know exactly what you're spending your money
on different platforms, So they could integrate with all these
e commerce stores around the world, and you're using the
Apple dollar on there as well, so now they can
see where you're spending your money. They can target ads
towards you more intrusively because they know where you spend
your money. Now that are platforms around that actually share
(08:03):
that data already and type back to the banks. Now,
this is a new thing that our platforms out there
that do share financial data with the big tech companies,
but this takes out that middleman and gives that data
directly to the big tech companies. So this is a
major invasion of privacy, so something you also need to
be aware of here. Now. While back, Facebook or Meta
as they know now, did actually try this with their
(08:25):
own blockchain called Libra, and they're going to launch a
token on there and use it within the Facebook ecosystem.
It later rebranded to Dime and kind of was shelved
and put away after the major backlash in the cryptocurrency
space and the general Facebook environment as well. So there
is that history of Facebook wanting to enter into this
(08:46):
particular space so they know the value of it here
and how much data they could collect for their own
platform so they can increase advertising revenue and so on.
So there's a lot of benefits for big tech companies
to get on board here. So decentralization and privacy is very,
very important, especially if you want to play around with
these stable coins or cryptocurrency in general. Now there are
(09:09):
alternatives that do foster decentralization and Moneta. USDM, built on
the Condona blockchain, is one of the stable coins that
believes in this big level of decentralization. So let's take USDM,
the stable coin issued by Manetta on the Condunda blockchain.
It's MICAH compliant, so you can use this in the EU.
(09:32):
The EU are putting in these laws to make money
transfers a lot harder and you have to be fully compliant,
and USDM is one of the only stable coins that
is MICA compliant, so this is something that's really important
to note. It's built natively on Candano with no bridges
or intermediate frees. It's designed to be unfreezible and seizure resistant,
(09:53):
so unlike other stable coins on other ecosystems where they
can be frozen, USDM can't be frozen on the Caadano
block chain. And one of the really cool things I
like about it is that it operates by the state
by state MTL system, So that's the money transmitter license
that is issued by state by state in the US.
So if one state decides to ban it for whatever reason,
(10:15):
you can still mint and withdraw it in any of
the other states without any question. So it gives you
that level of decentralization in the operations of the staple
cooin itself. So if the federal regulators change the stance
or political wins shift, USDM can continue to operate. Its
compliance strategy is resilient and decentralized. And because Kadano itself
(10:38):
is the most decentralized network out there, with thousands of
independent node operators, the Minetta stable coin inherits all of
that robustness as well. So why does decentralization even matter?
And decentralization isn't just about resisting governments, it's about reducing
systemic failure. When no single party can freeze, sensor, or
(10:59):
revoke your access, you're in control. That's the entire promise
of crypto and that's exactly why centralized bank backed or
tech back stable coins under the Genius Act could carry
those particular risks. So if you're worried about censorship, financial surveillance,
or programmable policy, and solutions like this could be the
(11:19):
thing that you're looking for. Closing thoughts for you, guys.
The Genius Act could streamline regulation, that's for sure, but
it could also consolidate power to those big banks, tech giants,
or federal agencies. If stable coins are supposed to be
the future of money, then we need to decide what
type of future we want that to be. Do we
want that future to be controlled by centralized banks, federal agencies,
(11:43):
and corporate interests, or one where financial sovereignty is respected
and decentralization is a priority. So choose your stable coins wisely.
So check out USDM and other stable cooin assets on
the Cadano blockchain and keep asking the hard questions or
the links in references down below. If you liked this episode,
make sure you hit that light thumbs up subscribe notification
(12:04):
bell on your way out. I'll keep you guys up
to date with everything that's happening in the Candano and
cryptocurrency space. I'm Peter, and I'll see in the next episode.
Congress is hard at work getting the Genius Act pass
and across the President's desk as quickly as possible. It's
with good reason, because regulatory uncertainty in this country has
pushed way too much stable coin activity overseas over the
last few years, and once the Genius Act is enacted,
it's poised to vastly expand the use of stable coins
(00:23):
as a digital payment system for millions of our fellow Americans.
It will also protect coin holders and eject further transparency
into the market. And let me be emphatic on one
other point. In this administration, we do not think that
stable coins threaten the integrity of the United States dollar.
Quite the opposite. In fact, we view them as a
(00:45):
forced multiplier of our economic might.
Speaker 2 (00:49):
The Genius Act is with the US Senate at the moment,
and if it passes with the filibusta, we will see
a regulatory framework for stable coins how they're supposed to
operate in the United States of America. This is very
good for the cryptocurrency industry overall, but there could be
some really strong overreach from the government when it comes
(01:13):
to control of those stable coins. We're going to go
into all of this in this episode. Let's get to
it now. For those that are familiar with stable coins,
they're essentially the cryptocurrency version of fit based currency. So
if you're trading on a decentralized exchange or a centralized exchange,
or just transferring value from one person to another, you'd
(01:34):
use these stable coins to do so. And there's plenty
of them. So it's a massive market with potential of
trillions of dollars transmitting through these stable coins on a
daily basis. But it lacks that clear regulatory framework so
that people understand how you're supposed to issue them, how
they're supposed to be backed one to one with US
(01:55):
treasuries or US dollars, whatever it might be. So that
doesn't have that regulatory framework until maybe very soon with
this Genius Act. Now, the Genius Act is a proposed
built where stablecoin issuers can apply for a single issuer license,
So this is federally controlled, takes away all that paperwork
that you normally would need going state by state, and
(02:17):
it is a painful process to get your licenses in
every state in the US. But this single license to
allow you become a stabacoin issuer if you follow or
with protocols. So in theory, this will reduce the friction,
simplify compliance, and could promote innovation by making it easier
for serious projects to launch nationally. And that sounds really good,
but there's a catch. Participation is optional. Issues can still
(02:40):
go the traditional route state by state licensing. Check out
this article here from the Wall Street Journal that came
out last week. Major banks JP, Morgan, Bank of America, Citygroup,
and Wells Fargo are reported in early stage talks to
launch a joint stable coin. They're doing this through entities
like Early Warning Services, the company behind Zelly, and the
(03:03):
clearing house which runs real time payments in the US.
When do you ever see major banks working together? Only
if there's a big incentive for them to do so.
And they're worried because stable cooins could siphon away deposits
and transactions, especially under the pro crypto administration, and if
tech companies or retailers jump into that's even more pressure
(03:25):
on the banking model. So the banks are responding to this.
They want in, but more importantly, they want the control. Now.
The way that the banking system works at the moment
is that it uses something called fractional reserve banking. So
fractional reserve banking is a system in which only a
fraction of the bank deposits are required to be available
for withdrawal. Banks only need to keep a specific amount
(03:46):
of cash on hand and create loans from the money
that you deposit. So fractional reserve works to expand the
economy by freeing up that capital for lending. So if
that feit currency isn't in the bank's possession, they can't
loan out that money to expand the economy, and they
can't generate any more revenue for themselves. So it's in
their best interest to create that stable coin so they
(04:07):
have control over that and they can still loan out
money and generate revenue. Now, there is also a big
issue with centralization of a particular stable coin under this
federal licensing. Now, imagine that you were a big stepcoin
issuer and you had this particular political alignment that didn't
fit with the current administration whatever it might be. Mybe
(04:28):
ten years down the track and they decide that you
can no longer issue that particular stable coin. They take
away your license, and that stable cooint is essentially can
put and any of the users under that particular stable
coin will be affected accordingly. So there is that massive
risk of that level of centralization that could possibly happen
there too. And you can even take that a step
(04:50):
further down to the personal level. Maybe you're a holder
of a particular stable coin and you're using it to
transmits funds or whatever, but you said something on social
media and that particular administration didn't like what you said.
They could possibly freeze or restrict movement of funds from
your account, so that could be possible as well. It's
(05:12):
kind of one step away from a central bank digital currency,
which is something that you should be really alarmed about,
because they can seize, they can freeze, they can do
anything they want with your current balance of stable cooin,
whatever it might be. So it could be one step
away from that type of scenario and that is definitely
something that we don't want in the decentralized economy. And
(05:34):
if something like that happens again, then cash would be
the preferred currency, the ThReD fit currency for trade. And
in some countries around the world they're making cash really
hard to obtain, like in Australia, they're closing down more
and more ATMs, they're charging you fees for taking out
cash and even asking you questions in regards to what
you may be taking out that cash for. So there's
(05:56):
a lot of rules around it, and it's making a
lot harder for people to obtain cash. So this is
something a lot of people are taking note of. Now.
One of the things with a center back digital currency
is the idea of programmable money. So if they put
in a monetary policy that says we need to increase
spending within the economy, they could do something like, all right,
(06:16):
you have to the end of the month to spend
ten percent of the funds in your savings or else
we'll just take it away and spend it for you.
And they can program that in to the money because
it's run by smart contracts, and state that, okay, if
this money balance doesn't reduce by ten percent, then we
will just take that ten percent and they could tax
(06:37):
that money from you and use it in the economy
to stimulate spending. So there's a lot of things that
they can do with a CBDC if that ever does pass.
And I'm very worried about these type of CBDCs. Now,
let's go back to the STABQUN regulation and what big
tech might do. Now, there's a couple of articles that
are circling around at the moment saying that big tech
(06:57):
could step in and become issuers of stable coins themselves.
A lot of these big companies have massive reserves of
US currency and they could deploy it anytime they want,
but they could also deploy their own stable coin and
get users on their platforms to use that stable coin
for transferring funds reduce their costs. They don't have to
use the party payment system, so they are their own
(07:18):
payment to payment gateway, which would reduce costs and increase efficiency.
So it's a good idea for them to actually do
something like this, But it also reveals to those companies
what you're spending your money on, so this is a
big invasion of privacy. Let's say you're using Apple pay
and you're now using the Apple pay dollar whatever it
might be called. That sounds like a good name to me,
(07:41):
But now they know exactly what you're spending your money
on different platforms, So they could integrate with all these
e commerce stores around the world, and you're using the
Apple dollar on there as well, so now they can
see where you're spending your money. They can target ads
towards you more intrusively because they know where you spend
your money. Now that are platforms around that actually share
(08:03):
that data already and type back to the banks. Now,
this is a new thing that our platforms out there
that do share financial data with the big tech companies,
but this takes out that middleman and gives that data
directly to the big tech companies. So this is a
major invasion of privacy, so something you also need to
be aware of here. Now. While back, Facebook or Meta
as they know now, did actually try this with their
(08:25):
own blockchain called Libra, and they're going to launch a
token on there and use it within the Facebook ecosystem.
It later rebranded to Dime and kind of was shelved
and put away after the major backlash in the cryptocurrency
space and the general Facebook environment as well. So there
is that history of Facebook wanting to enter into this
(08:46):
particular space so they know the value of it here
and how much data they could collect for their own
platform so they can increase advertising revenue and so on.
So there's a lot of benefits for big tech companies
to get on board here. So decentralization and privacy is very,
very important, especially if you want to play around with
these stable coins or cryptocurrency in general. Now there are
(09:09):
alternatives that do foster decentralization and Moneta. USDM, built on
the Condona blockchain, is one of the stable coins that
believes in this big level of decentralization. So let's take USDM,
the stable coin issued by Manetta on the Condunda blockchain.
It's MICAH compliant, so you can use this in the EU.
(09:32):
The EU are putting in these laws to make money
transfers a lot harder and you have to be fully compliant,
and USDM is one of the only stable coins that
is MICA compliant, so this is something that's really important
to note. It's built natively on Candano with no bridges
or intermediate frees. It's designed to be unfreezible and seizure resistant,
(09:53):
so unlike other stable coins on other ecosystems where they
can be frozen, USDM can't be frozen on the Caadano
block chain. And one of the really cool things I
like about it is that it operates by the state
by state MTL system, So that's the money transmitter license
that is issued by state by state in the US.
So if one state decides to ban it for whatever reason,
(10:15):
you can still mint and withdraw it in any of
the other states without any question. So it gives you
that level of decentralization in the operations of the staple
cooin itself. So if the federal regulators change the stance
or political wins shift, USDM can continue to operate. Its
compliance strategy is resilient and decentralized. And because Kadano itself
(10:38):
is the most decentralized network out there, with thousands of
independent node operators, the Minetta stable coin inherits all of
that robustness as well. So why does decentralization even matter?
And decentralization isn't just about resisting governments, it's about reducing
systemic failure. When no single party can freeze, sensor, or
(10:59):
revoke your access, you're in control. That's the entire promise
of crypto and that's exactly why centralized bank backed or
tech back stable coins under the Genius Act could carry
those particular risks. So if you're worried about censorship, financial surveillance,
or programmable policy, and solutions like this could be the
(11:19):
thing that you're looking for. Closing thoughts for you, guys.
The Genius Act could streamline regulation, that's for sure, but
it could also consolidate power to those big banks, tech giants,
or federal agencies. If stable coins are supposed to be
the future of money, then we need to decide what
type of future we want that to be. Do we
want that future to be controlled by centralized banks, federal agencies,
(11:43):
and corporate interests, or one where financial sovereignty is respected
and decentralization is a priority. So choose your stable coins wisely.
So check out USDM and other stable cooin assets on
the Cadano blockchain and keep asking the hard questions or
the links in references down below. If you liked this episode,
make sure you hit that light thumbs up subscribe notification
(12:04):
bell on your way out. I'll keep you guys up
to date with everything that's happening in the Candano and
cryptocurrency space. I'm Peter, and I'll see in the next episode.
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