The CEO and co-founder of Payment Company, Circle Jeremy Allaire believe that the world is “at the beginning of a tokenization of everything.”
He made this statement at the ongoing crypto fintech conference MoneyConf in Dublin, Ireland. While talking at the conference this month, Allaire noted that this period is an unprecedented “crypto-revolution,” and the world is at the beginning of turning everything into tokens.
Similar to the way, early internet transformed the way we see data and change our means of communications, blockchain technology is now set to revolutionize “every aspect of finance” and “reinvent public and civil services in [its] image”. Allaire explained that;
Once you have an open global immutable record-keeping system, [a] transaction-processing system and [a] secure computing environment, you can re-conceptualize on a global basis every aspect of finance… corporate and commercial law, the intermediation of contracts, [and] crucially all of the systems we use in [both corporate and civic] decision making.
Circle, which is a Goldman Sachs backed cryptocurrency and Payment Company, recently applied for a banking license in the U.S as it looks to become the first cryptocurrency company to be granted such license. While commenting on their banking license request last week, Allaire stated;
To hold reserves with the Federal Reserve, to natively access the central-banking system without intermediaries, to directly settle with other banks in other markets around the world through those networks — that can improve the efficiency of what we deliver, it can reduce the costs. The regulators need to figure this out because eventually other banks that they regulate are going to want to hold crypto. They’re going to need to have rules for this. We can be a great guinea pig.
Tokenized global economy to create a free market
Allaire, while talked about the vision of the economy said;
Circle is ran using tokens, with a society every form of value storage and public record becomes a crypto-token will lead to a free-floating market, with value to be traded on global digital exchanges.
He added that using crypto assets, people could tokenize their houses, cars or even art pieces and also create open global financial relationships around properties. According to him, the “tokenization of private or public votes in all forms of social governance” would offer an immutable system that is more transparent and accountable than current models.
Five categories of crypto assets
According to Allaire, there are five categories of crypto assets. The first one is the privacy cryptocurrencies which have been developed to take away financial activities from governments and banks and to be used as “a public good” on the internet.
Allaire added that crypto securities can be used as rule-based financial contracts, and can be used in more capacities than the paper contract that is currently binding in a court of law. He noted that most of the ICOs are classified under this category.
The next set of cryptocurrencies he talked about are those that support transaction settlement system, with Ripple and Stellar the popular names in this category. He also talked about the blockchain-based platforms like Ethereum and EOS which he considers to be the “operating systems for the global economy.”
The last crypto asset category Allaire talked about were the stablecoins that are backed by fiat currencies. This set of cryptocurrencies are designed to dominate financial contracts. He stated that they are mostly used when a less volatile price baseline is needed but decentralization and security of blockchain are also required.
Circle is itself looking to create a stablecoin after it closed a $110 million fundraising round last month, with Bitmain the leading contributor. Circle seeks to develop a dollar-backed stablecoin dubbed USDC, with the company revealing that the coin would be an ERC20 token that will be developed and maintained on the Ethereum network.
Visa’s Richey also talks at MoneyConf
The chief risk officer at Visa, Ellen Richey, also gave a speech at the MoneyConf yesterday where she warned the delegates that consumers are over sharing their data online and need to be more cautious when sharing their information.
She made this statement while talking about cybersecurity and data theft, adding that online fraud in whatever form is a critical issue in the payment industry and addressing it should be of high priority to fintech companies. She stated;
You can protect yourself and the standards are out there to tell you what to do.
Security is a very important thing to Visa after the company recently experienced a failure in its service in UK and Europe. On Friday, June 1, Visa customers in parts of the U.K. and Europe weren’t able to use their cards on Friday, with system failure making it impossible for their users in this region to complete transactions, with the system coming back on hours after the incident.
The event would also see other speakers as the co-founder of the cryptocurrency Ethereum and Kristo Kaarmann, CEO of a P2P money transfer service, Transferwise.