Micropayments, Central Banks, and Codius Smart Mining Contracts
POM and my career in the Canadian mining industry has brought me in contact with some interesting people. Both are a blessing in my life and keep me energized and super busy, but I wouldn’t have it any other way. Mining is awesome. Period. The biggest machines on Earth digging up the raw product which fuels the engine of the global machine. Cool, right?
The Canadian Prime Minister Justin Trudeau visited the Oil Sands on Friday. Politics aside, it was a great opportunity for our onsite team to meet the PM and the CEO of our biggest mining customer. I’m so proud of our team. The PM sat our our table during lunch (I wasn’t there thankfully) and the guys had some good conversations, and of course took selfies. The PM did a question and answer period in the huge shop and talked a lot about pipeline politics, and the need to build more of them to get our product to market. In the background you can see the 400 ton trucks our team has mobilized and put into operation. Cool, right?
I’ve never been able to share pictures with the POM team for obvious reasons, but the ones below are out there in the open media, so fair game.
A few years back while in Vancouver for a mining conference I met a VP of another company during dinner with mutual friends. We quickly got into monetary policy and the need for a transformation of the international system. I told him about POM and he was quite interested in everything I had to say. We’ve exchanged a few messages since, but he reached out to me again the other to day to ask my thoughts on the recent yuan denominated oil futures contract. David stated that this was huge news and wondered why news outlets were not making it the biggest story of the week. I posted the recent FREEPOM article titled The Battle between Unilateralism and Multilateralism on LinkedIn, and his message was a response to reading that piece.
My response to him is worth sharing with the POM team, as it could facilitate further clarification and understanding for us all:
Hi David. You’re absolutely correct. It is huge news. The internationalization of the Chinese renminbi will do a lot to rebalance global wealth and trade. The oil futures in yuan is the biggest step yet by China, and its trade partners, to shift global liquidity away from the USD.
With that being said, the Chinese monetary authorities aren’t interested in replacing the dollar with the yuan within the international system. But a large diversification of foreign exchange reserves needs to take place so dollar demand can decrease. This is something American monetary policymakers want as well.
This lower dollar demand will force a depreciation of the dollar, which will in turn make American made goods cheaper to the rest of the world. This will increase exports, create more jobs, and decrease America’s trade deficit. It’s Trump’s “Make America Great Again” mantra. Politics are always a representation of future socioeconomic realities, or how to package and sell those new realities.
In turn, China’s currency will appreciate, which will force a decrease in its trade surplus. Large trade deficits and surpluses are equally as destructive on domestic economies. The developing trade war between America and China will end with a structural change to the exchange rate arrangement which both nations have maintained to date.
I had always considered that the SDR of the International Monetary Fund would be used as the global reserve asset in place of the dollar. It is an asset which no one nation controls. But with the growth of blockchain and the crypto market, we can see that Ripple’s XRP is being engineered for this purpose. Already the Bank of England, the Federal Reserve, and the Saudi Arabian Monetary Authority have partnered with Ripple on test projects, among a host of other banks, like RBC, TD, and a 61 bank consortium in Japan.
The XRP interledger will connect all other ledgers, whether fiat or crypto. The interledger will be truly decentralized and not controlled by any one nation, bank, or institution, including Ripple themselves. It is something all nations can agree upon and use, as XRP transactions take 3 seconds and cost fractions of a cent. Compare to SWIFT which is expensive and takes 5 days.
Central banks will likely begin this year diversifying their foreign exchange reserve accounts with the top crypto assets. The rush for regulation is creating volatility in the first phase of the crypto market, but will allow for massive institutional money to enter during the next phase. Nothing in its digital version has failed. This will be the same with money. Fiat currencies will be replaced over time with their crypto versions.
The world is truly on the edge of a fundamental change. The internationalization the yuan is just one. The developing cross-border payments function of Ripple XRP, and the emergence of the whole new industry of micropayments it will allow, will create competition and a new level of ingenuity which we can only imagine right now.
Hope things are well in your world. Between my work of phasing in autonomous haul trucks in the oil sands, and learning and writing about these new and exciting realities for my website and subscribers, pretty much keeps me in a constant state of mid-range vibration and high energy. lol. Nothing boring, thats for sure.
Thanks for reaching David. I really appreciate you asking my opinion on these matters.
Another exchange worth including in this post is a question to the last article by reader Ledude59:
Hi JC ,
Ripple’s statement about their connexions with 40 or more central banks is something to consider. Is there a link or more , somewhere, to confirm the validity of this statement ?
I mean , this is really really a bold assertion , kind of game changer in this strange period of monetary trouble.
No doubt in my mind that XRP and Ripple will be part of the global monetary transformation . I have the same strategy as you , adding quietly more XRP as time goes by and value is cheaper and cheaper and I sleep very well at night . Don’t know how much time it will take to see the dollar demise and the rise of a new monetary architecture ( I guess between 3 to 5 years from now ) , but there is still one point that can be dangerous about XRP.
For now , we already are in a currency war , and to the point of starting a trade war with China . All nations are still in partnership in the monetary front , working with IMF , WorlBank and BIS.
But if the US start a real trade war , why should China use Ripple , a US company , to protect his wealth ? It is well known that the Chinese have a strategy to duplicate all western institutions to cut western influence and increase their own power.
Why not try to launch their own ” Asian Ripple ” ? They do have the technical skills . And if this trade war escalates into a real war , why should they not play the patriotic cord on a monetary plan with cryptocurrencies ? We hear drums of war in so many places around the globe…….
This is the only point that bother me in the future of cryptos……
Could you tell us what you think about this kind of risk ?
Thanks for all of your writings……..!
My response to Ledude59 is as follows:
It was a Ripple executive at a conference in Thailand last week. You can watch the words come right out of his mouth on tons of YouTube videos of the event. Just search Ripple 4o central banks and pick from the list of videos. Isn’t it interesting that 40 to 50 central banks is the exact range of the 44 allied nations which participated in the Bretton Woods conference? Just an interesting parallel.
China will use XRP for the simple reason that the interledger will be completely decentralized. More than any other ledger. This is a lot of false information about this out there. But the reality is that each nation and bank which joins the ledger will have its own validator on the network. No one nation, bank, or institution will control the XRP ledger. Not even Ripple. This is exactly what everyone needs.
China, and other nations, will have their own crypto asset and ledger, but the XRP interledger will connect them all, with XRP being used as the bridge asset to complete transactions. Want to exchange renminbi fiat for Bitcoin, use XRP. Want to exchange USD crypto asset for Ethereum, use XRP. It will be the dominant monetary asset in the world, through its use across multiple platforms and functions, including a whole new industry of micropayment which will start to emerge.
Central banks will place XRP, and other cryptos, in their foreign exchange reserve accounts. Everything will flip over the next few years. A true fundamental change. We are only just now beginning to understand the full impact of what is happening, and what is coming.
Well, there it is. The world is changing. Get onboard or get left behind. Now I can’t wait for both of my worlds to merge together under SMART Mining Contracts on the Ripple Codius platform. Cool, right? – JC
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JC Collins can be contacted at firstname.lastname@example.org