Jeremy Allaire, Co-Founder & CEO of payments company Circle spoke this morning of an unprecedented “crypto-revolution,” saying that global society is “at the beginning of a tokenization of everything.”
Just as the early internet transformed data and communications, blockchain is now poised to revolutionize “every aspect of finance” and “reinvent public and civil services in [its] image”:
“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.”
The CEO outlined a vision of a tokenized global economy and society, in which “every form of value storage and public record becomes a crypto-token” that has free-floating market value and can be traded on global digital exchanges.
With crypto-assets, he said, you can “tokenize your house, car or art,” and establish open global financial relationships around any physical property.
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.
Allaire outlined five categories of crypto-assets, beginning with privacy-focused cryptocurrencies that remove financial activities from the centralized control of governments and serve as “a public good” on the internet.
So-called ‘crypto-securities’ can function to represent rule-based financial contracts and have a potential that goes “far beyond” a paper contract mediated by a law firm in court. He emphasized that lot of initial coin offerings (ICOs) come under this category.
He then addressed crypto-assets that support transaction settlement systems, such as Ripple (XRP) and Stellar (XLM), as well as very ambitious” blockchain-based platforms such as Ethereum (ETH), which he characterized as “operating systems for the global economy.”
Allaire’s last category of crypto-assets were fiat-backed stable coins, designed for denominating financial contracts. Allaire emphasized their potential for use cases that require a less volatile price baseline, but still seek the decentralization and security of blockchain.
Just last month, Circle closed a $110 mln fundraising round led by mining hardware manufacturer Bitmain to partner on the development of a US dollar-backed stable coin. Circle’s USDC will be an ERC-20 token based on the Ethereum network, and will reportedly be released by Circle in the summer. The investment brought Circle’s valuation to nearly $3 bln, an almost sixfold increase since 2016.