They can be cashed out for government currency in most of the world. Both are global and readily available to all digital wallets. Tether is valued at $70 billion and USDC at $26 billion. Tether (USDT) and USDC are both private stablecoins. Volatility in this or that token can be avoided if there is a stable alternative to swap into at key moments. A stable currency is really important in a fully digital money system. The idea that technology can become fully decentralized, with no need to trust participants is also central to Fred Wilson’s reaction to the SEC Commissioner favoring private stablecoins to central government-issued digital currencies. Because I think it is 100% correct in pointing to the centralizing tendencies of blockchain innovation, recreating the architecture of the current generation of the internet where we end up with large powerful corporations that “own” key pieces of infrastructure. So why is the research paper interesting. It also does so with a model that rewards holders of its token by issuing regular rewards for holding. It claims to solve much of the speed problem without compromising a fully decentralized and trustless architecture. it is a new level 1 blockchain, as is Bitcoin for example, and Ethereum. The price is a re-centralization of the technology, creating the need to trust third parties when the entire point of the blockchain is to remove trust as a necessity.Įnter Algorand.

But, the paper argues, that comes at a price. That has led innovation to happen in the layer above. The reason for this is that many have deemed level 1 blockchains to be inherently unscalable from the point of view of the speed of transactions even though they scale in terms of size. Basically, things are built on top of “level 1” blockchains. The short version (I encourage you to read the longer one) is that innovation in the blockchain has moved to what is called “level 2” applications. And in the same week, my old friend Mike Arrington revealed his next act – having moved to Miami – will be to double down on the crypto industry and invest Arrington Capital’s new fund(s) in the sector.īy far the most interesting thing I read however was the research put out by Arrington Capital explaining its investment into the Algorand blockchain and its $100m fund focused on innovation on that chain.

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