On the latest episode of CoinGeek Weekly Livestream, host Kurt Wuckert Jr. was joined by Gavin Lucas, who discussed the tokenization wave in Wall Street, the house of cards that’s the ‘crypto’ market, decentralized governance, and how Bitcoin can solve the ongoing erosion of individuality.
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The tokenization of Wall Street
Lucas started by discussing his latest deep dive into the tokenization of Wall Street. Every other financial giant is rushing to position itself as a leader in the emerging field, much to the celebration of the ‘crypto’ sector.
However, Lucas noted that the existing blockchain infrastructure can’t handle Wall Street’s volume. For instance, Ethereum and its Layer 2s and 3s hit a record daily volume of 21 million transactions in June, which was hailed as groundbreaking. However, this was less than half of what NASDAQ processes daily.
And yet, these networks continue to attract billions of dollars. According to Wuckert, this is because “incentives in ‘crypto’ have aligned to consistently encourage people to be unproductive for the sake of being more wealthy.”
The ‘crypto’ system further relies on a house of cards where the value of dozens of tokens balloons into the billions in months, but with very little liquidity. This is compounded by Tether, whose USDT underpins the ‘crypto’ market, but is built entirely on a “reckless and unlawful” business model, according to New York regulators.
Privatized tokenization
Still, tokenization remains one of the emerging technologies set to take over Wall Street. As Lucas noted, it’s the first ‘crypto’ trend that has skipped the speculation phase and gone straight to utility.
“Anyone who thinks blockchains won’t be a thing, just look at [tokenization on Wall Street]…it will be,” he stated.
However, as with other technology, the industry giants are pushing to lock the market into their private ecosystems. The goal is to capture enough value that a client finds it extremely cumbersome to switch networks, much like what Google (NASDAQ: GOOGL) and Meta (NASDAQ: META) do with their tech ecosystems.
This comes at the cost of interoperability as every siloed ecosystem operates under distinct technology and standards. Holders of tokens issued on JP Morgan’s (NASDAQ: JPM) platform will not be able to transact with Citi’s (NASDAQ: C) network users. This will take the market back to the same challenge of siloed ecosystems that limit the global financial rails today.
Ultimately, the conclusion will be that these private networks should be the application layer, underpinned by one massively scaling base layer, Lucas says.
Today, only BSV is exploring the idea of a million transactions per second with Teranode, making it the only decentralized network that can underpin the vast infrastructure that powers the global financial system. Additionally, it charges the lowest fees and has node structures that can enforce regulatory standards such as court orders and property rights.
The erosion of individuality and the Bitcoin solution
Lucas then discussed the continued erosion of privacy and, consequently, individuality in the digital age. This originated in groupthink ideologies, where millions are homogenized under a banner without distinction for the individual nuances. Then came the internet and social media, amplifying the effect by gradually eroding a sense of privacy, Lucas noted.
“The whole Western civilization depends on that idea: there’s an individual, and the rights of that individual exist. If people no longer have a sense of self separate from others, then all that will go,” he said.
While individuality must be preserved, society needs to collaborate for problem-solving, and a massively scaling blockchain is the best way to achieve this, Lucas believes.
The solution is “a scalable public ledger that allows you to cooperate on a global level, gather data about everything, but also allows you to maintain your privacy while not being anonymous and upholding the law,” he stated.
Lucas added that this scalable public ledger is also critical for holding those in power accountable. Governments and public companies would have public wallets—even if they are maintained by a financial institution—linked to public blockchains, enabling citizens and shareholders to certify their funds and transactions.
An immutable trail on a public ledger would change the incentives for those in power, as they would know that all their actions and transactions can no longer be obfuscated.
Watch: Tokenized was built with blood, sweat and tears
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Source: https://coingeek.com/the-tokenization-of-wall-street-and-erosion-of-individuality-video/
