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There’s a parallel between cryptoassets today and the British colonial period predating the US. In the late-1600s, colonies began to print their own money. Today, we’re seeing many startups coin their own money, creating an explosion in the number of new (crypto)currencies.
States printed colonial money to pay debts to citizens. During tax collection times, the state accepted citizens’ bills as payment and retired the bills from circulation. Citizens would pay each other with these bills. They could also exchange them across state lines, but not at 1:1. Each state’s bills had a different exchange rate...
...I think about this history when meeting cryptoasset businesses. Each startup is creating a new currency, like the colonies. They each have a white paper, drafted in the font of academic papers with LaTeX equations. These whitepapers are the policy documents of a mini-federal reserve bank of a their currency. The white paper outlines the monetary policy of the economy. How will currency be doled out? When will it be created? How will it be regulated?...
Tomasz Tunguz, Venture Capitalist at Redpoint.
States printed colonial money to pay debts to citizens. During tax collection times, the state accepted citizens’ bills as payment and retired the bills from circulation. Citizens would pay each other with these bills. They could also exchange them across state lines, but not at 1:1. Each state’s bills had a different exchange rate...
...I think about this history when meeting cryptoasset businesses. Each startup is creating a new currency, like the colonies. They each have a white paper, drafted in the font of academic papers with LaTeX equations. These whitepapers are the policy documents of a mini-federal reserve bank of a their currency. The white paper outlines the monetary policy of the economy. How will currency be doled out? When will it be created? How will it be regulated?...
Tomasz Tunguz, Venture Capitalist at Redpoint.
http://tomtunguz.com/cryto-and-colonial/