💫 Summary
The video explores the possibility of backing XRP with physical assets such as gold, as well as its potential role as a world reserve currency. It discusses the distinction between backing and pegging, and highlights the increasing interest from central banks and institutions in cryptocurrencies like XRP. The narrator emphasizes the need to position oneself in assets that will be used in the future financial system.
✨ Highlights📊 Transcript
The debate between gold-backed and pegged XRP is discussed, with the distinction between backing and pegging explained.
The difference between backing and pegging is clarified, with an emphasis on XRP being backed by real-world assets like energy or gold.
It is explained that XRP could provide liquidity to transfer value for tokenized items on the network, such as stable coins or CBDCs.
The IMF document that defines different types of crypto assets, including security tokens like Ethereum and utility tokens, is mentioned.
Physical assets can be tokenized, and their ownership rights can be embodied in a token, which is the way of the future.
Tokenization of physical assets is already being done by entrepreneurs and businesses.
XRP Ledger will be backed by the value settled on the Ledger, including gold, silver, and almost every commodity tokenized.
Real estate and some derivatives are also ready for tokenization on the XRP Ledger.
XRP could become the world reserve currency backed by commodities instead of fiat currencies.
The current system has fiat currencies backing fiat currencies.
XRP being a native currency could differentiate it from other cryptocurrencies.
Ripple is working towards making XRP a world reserve currency.
XRP being backed by commodities could stabilize the system and prevent financial crises.
XRP and gold are likely to be at the top due to central banks buying more gold and meeting with Ripple, and there are already two Central Bank digital currencies built on the XRP Ledger.
Central banks are buying gold at the highest level in 55 years.
Ripple has had multiple meetings with central banks.
There are already two Central Bank digital currencies built on the XRP Ledger.
XRP couldn't become an SDR unless they reprogrammed a portion of XRP that's not on the market.
XRP's potential role as a world reserve currency and payment rail for global value transfer is discussed, including its backing by physical assets and the emergence of a store of value use case.
XRP could potentially become the world reserve currency and serve as the payment rails for global value transfer.
There is a discussion about XRP being backed by physical assets and potentially up to 20 commodities.
The emergence of a store of value use case for XRP is mentioned, which could lead to a virtuous cycle of value.
Ripple is treating XRP like a reserve currency by distributing and returning a majority of it from the escrow account, suggesting it might be considered a reserve currency.
Some argue that XRP cannot be a reserve currency because it is not officially recognized by the government.
Ripple may be interested in creating a more stable financial system and has shown interest from institutions like R3.
Conversations with lawyers are being held to protect assets, including the possibility of backing XRP with gold.
The speaker believes it is important to position assets in cryptocurrencies like XRP, XLM, and XDC for the new financial system.
00:00last time I covered this topic people
00:03had some things to say so this time I'm
00:05going to dive into both sides of the
00:07story and what I found might surprise
00:09you the gold-backed crypto debate ends
00:14gold coin has gone on sale in Zimbabwe
00:17inflation is everywhere you have to be
00:19careful money has no intrinsic value and
00:22cannot be redeemed
00:25Bakery we really don't know where the
00:27market will go until we see our
00:29inflation in the economy play out
00:38first we've got to talk about the
00:40difference between these two actions so
00:42I think people have an issue and they
00:44can they convolute backing and pegging
00:47so I want to make the distinction
00:48between the two if something is pegged
00:50then it's fixed to that value and I hear
00:53a lot of people speak about xrp being
00:55backed quote unquote by gold and then
00:57the price being moved to whatever the
01:00equivalent of gold would be that would
01:01be a pegging and that would actually
01:02cause a lot of issues because then xrp
01:05wouldn't be able to scale globally as
01:08more value moved on to the network they
01:10would have to revalue Gold every time
01:12they needed to do that but any item that
01:15is tokenized on the network and may even
01:19back another currency that's issued on
01:21top of the xrpl such as a stable coin or
01:24a cbdc could be a backing for xrp as
01:28well because xrp is going to have to
01:30provide the liquidity to transfer that
01:33value when I think about backing I look
01:36at it as the real world asset you could
01:40have energy you could have gold you
01:42could have a lot of things that it could
01:44be that could be tokenized and back a
01:46cbdc or stable coin and then that would
01:49be a quote-unquote backing for xrp so
01:52now that we know that we have to see if
01:54it's possible to back xrp with a
01:57commodity so the IMF set out a document
02:00that defines all the different types of
02:02crypto assets first up you have security
02:04tokens like ethereum the next one is a
02:08utility token and this isn't really what
02:10you think think more along the lines of
02:12a gaming token or a cryptocurrency gift
02:14card for a restaurant rather than the
02:16asset that you think of immediately in
02:19your mind then you've got unbacked
02:20crypto assets and Bitcoin would fall
02:22under this category as well as xrp
02:25technically at this moment in time would
02:27also fall under that category then
02:28you've got stable coins like usdt and
02:31finally cbdc's each of those have their
02:33own definitions and xrp where that fits
02:36in this whole thing it doesn't truly fit
02:38into any category in fact there is
02:40actually a new categorization of a token
02:42that would need to be established in
02:44order to make it fit into this new
02:46system and that would be asset-backed
02:48crypto assets and you're thinking well
02:50yeah Lewis obviously however you can't
02:53actually do this directly Matt Hamilton
02:56is right xrp for example cannot be
03:00directly backed by gold but fear not
03:03there is a workaround and it's
03:05mind-numbingly simple I think when
03:08people say you can't back a token or
03:11something certainly you can I mean
03:12there's multiple papers I mean you can
03:15go to and read a whole blog post on
03:19tokenizing assets uh so it absolutely
03:22can be done I think maybe the dispute
03:25comes a little around almost arguing
03:27from two sizes a coin maybe they're
03:29saying you can't take a physical asset
03:31and put that on a blockchain which is
03:34yeah okay that that makes sense the
03:37other side of the coin is that you take
03:39all of the indicia of ownership all of
03:42the rights associated with owning the
03:45physical asset and put that on the token
03:49you know embody that meant that as a
03:51token and then holding that token
03:54becomes the same as effectively having
03:57all of the rights associated with the
03:59physical asset that's where we believe
04:01the whole world is headed that there
04:04will be a digital representation of all
04:07physical assets you know in the future
04:09and that that's part of a lot of the
04:11work that's being done now by developers
04:14and and project entrepreneurs we've had
04:17numerous conversations with a bunch of
04:19different entrepreneurs and businesses
04:21some who are already tokenizing gold
04:24others who are you know tokenizing other
04:26commodity assets so absolutely the way
04:29of the future so if it's so easy to work
04:32around that issue it opens up the
04:34question of how do you even Define
04:36backing anyway it's a technical Nuance
04:38to say that gold is not going to back
04:41xrp because xrp is going to be backed by
04:44all of the value that is put on this
04:47Ledger and settled on this Ledger that's
04:49going to be gold it's going to be silver
04:51and I believe that you're going to see
04:52almost every commodity tokenized and put
04:54on The xrp Ledger along with real estate
04:56I think that we're ready to handle some
04:58derivatives we're ready to obviously
05:00they're moving fast forward ahead with
05:02cross-border payments is what you know
05:04the the public test that's being seen by
05:06everyone right but I believe that you're
05:08going to see tokenized stocks bonds
05:09Commodities everything on The xrp Ledger
05:12and others and I want to reiterate many
05:14people know where I stand as you know
05:16very big fan of xrp other ledgers are
05:19going to get pieces of this action as
05:21well so why do we even need to back
05:23digital assets in the first place like
05:25why are we even having this conversation
05:26well let's have a look at where we are
05:28in the world right now inflation is
05:30higher than ever the cost of living is
05:31going up as a result debt goes up and
05:34the people of the world can no longer
05:36afford to live the same lifestyle that
05:38they've been living and this has all
05:39happened because the world Reserve
05:41currency being the US dollar only holds
05:43value because of what the U.S government
05:45have said its value is and this is the
05:48hilarious truth that the current
05:50Financial system exists within and has
05:52existed for my whole entire life and if
05:54you were born anytime after the 1970s
05:57it's been your whole life too it's
05:59inevitable that the flaw in the system
06:01would cause this financial's downward
06:04spiral that we're seeing right now and
06:06the process of backing a crypto asset
06:08with a commodity would stabilize the
06:10system and it would erase the chances of
06:12seeing this spiral that we're seeing now
06:14but here's where it gets juicy so as it
06:16stands right now we have the US dollar
06:17as the world Reserve currency the dollar
06:19sits right up there as what we'll call
06:21the king SDR SDR stands for special
06:24drawing rights and it's effectively an
06:26asset that is issued by the IMF and in
06:29times of Crisis sdrs can help to recover
06:32these bad financial situations anyway
06:34underneath the king SDR you have a
06:36basket of other sdrs with varying
06:39percentages of waiting for example the
06:41US dollar holds about 41.73 waiting you
06:45have the Euro with about 31 the Chinese
06:47one with about 11 the Japanese Yen with
06:50about eight percent and the British
06:52pound sterling at about eight percent as
06:54well so what you've got is Fiat
06:56currencies backing Fiat currencies
06:59that's really weird right what if there
07:01is another way to do this one that
07:03involves crypto assets and a backing
07:05system of Commodities let's reimagine a
07:09system where the US dollar is dethroned
07:11as the world Reserve currency this
07:13process is called de-dollarization and
07:15has been plenty of research like I've
07:17covered in previous videos about how the
07:18brics nations are actually going through
07:20the process of de-dollarizing something
07:23needs to go in that top position
07:24something needs to be World Reserve
07:26currency but I think that we need to
07:28start looking at xrp as the standard as
07:31the currency and it's a key thing that
07:33differentiates xrp from the rest of the
07:35space is the true nature of xrp being a
07:39currency it's not just a tech you know
07:41we're investing in software we're
07:42investing in Tech but xrp being that
07:45native currency and ripple working on
07:47their goal of making it a world Reserve
07:49currency is much different than the rest
07:51of the space and I would argue that many
07:52Crypt quote unquote cryptocurrencies
07:54have not actually created that strong of
07:56a currency they have a token and and so
07:58once again yeah I think that you're
08:00right I think that people saying that
08:02value getting tokenized on The xrp
08:04Ledger isn't going to affect the xrp's
08:06value the xrp price I I think that
08:09that's mistaken well think about this
08:10the SDR right now is backed by five
08:12currencies xrp is going to be backed by
08:14every currency and every commodity and
08:16every form of value on the planet
08:18so in my opinion it's already equivalent
08:21to an SDR
08:22and we just put names on things
08:25so basically there's no code that says
08:28that the United States military backs
08:30the US dollar so there's guys in the in
08:33in the conversation right now that are
08:34saying well there's nowhere in the code
08:36so it technically cannot be backed by
08:39these tokens right or the value
08:41but for all intents and purposes right
08:44more value that's getting put on that
08:45ledger is going to increase the value of
08:48that ledger of that underlying asset
08:50that underline native currency xrp in
08:53this instance and I've long compared uh
08:56you know Ripple
08:58to the IMF or the bank of international
09:00settlements and in fact I'd argue that
09:02they're kind of a little bit of both
09:03right they're they're issuing they have
09:05control of the world Reserve currency
09:07the world Reserve digital currency xrp
09:09through that escrow account and having
09:11such a large Supply but then they also
09:14are a settlement Clearinghouse similar
09:16to the bis
09:18but what assets are going to be on the
09:20top well here's two data points
09:23central banks are buying more gold than
09:25they have in 55 years and the most
09:27amount of central banks are meeting with
09:30if anybody wants to challenge that they
09:31can show me that algorans had 50 plus
09:34meetings with central banks or any of
09:36these other utility cryptocurrencies
09:37that I do like quants on the digital
09:39pound Foundation digital Euro right you
09:42know these these crypto projects are
09:44making appearances but we have two facts
09:47from my research
09:49and this is very well agreed upon and
09:51documented with gold they're the pace
09:53that they're buying gold is the highest
09:55level in 55 years since the last time
09:57they reset the currency
09:58and then they're sitting down with
10:00ripple and we also have already two
10:02Central Bank digital currencies built on
10:04The xrp Ledger right now
10:07so I'm running with those data points to
10:09tell me that xrp and gold are going to
10:12be at the top in order for this to
10:13happen xrp essentially becomes the king
10:15SDR however one of the fundamental
10:18characteristics of an SDR is that it
10:20cannot be owned by any private
10:22individual and this causes a slight
10:25problem because there are probably
10:26hundreds of thousands if not millions of
10:28wallets that have what we call dust this
10:31dust is Tiny Trace Amounts of xrp
10:33there's just residue after transactions
10:36in a wallet that is since forgotten
10:38about I could say from my own experience
10:39I've got like six or seven wallets that
10:42have Trace Amounts of xrp that I just
10:43don't use I don't even log into those
10:45wallets anymore and because that dust
10:47xrp is still technically owned by the
10:51for that reason xrp couldn't become an
10:54SDR unless of course they reprogrammed a
10:57portion of xrp that's not on the market
10:59I don't know like the escrow or
11:01something the escrow what if they
11:03reprogram their escrow xrp and made all
11:06the tokens there
11:07the xrp SDR essentially creating a
11:11different token to me it makes most
11:12sense that the escrow account is already
11:15accounted for meaning that Ripple have
11:17already got contracts in place that
11:18would allow for the release of xrp to
11:20certain institutions when the court case
11:22is resolved for me I see that as a
11:24likely outcome but what happens if xrp
11:27is the chosen King SDR and the escrow is
11:30already accounted for meaning you can't
11:32draw escrow tokens from the escrow to
11:34become sdrs you might have connected the
11:36dots already could the IMF for example
11:38incentivize people to offer up their xrp
11:42that xrp then being sent over to them
11:44for them to reprogram into SDR xrp okay
11:48let's relax I know this is a touchy
11:50subject so let's explore some other
11:52options for how this new system might
11:54look let's say the world Reserve
11:55currency the king SDR isn't xrp so I
12:00don't believe that xrp will be the
12:02global Reserve digital asset I believe
12:05it's just the liquidity provider for all
12:08the transactions globally so there will
12:10be multiple Reserve currencies that sit
12:13within the imf's basket which is
12:16designated as the SDR or the special
12:18drawing right there's a potential Brad
12:21garlinghouse mentioned this when he was
12:23speaking to the director of the IMF that
12:25somebody would have to adopt xrp as
12:29their National currency in order for it
12:31to sit within that basket so what's the
12:34role of xrp in this system well it's the
12:37rails for payments of everything it's
12:39the web that connects the world Reserve
12:41currency to the CBD sees and the cbdcs
12:45to the assets or Commodities that back
12:47those cbdc's the transfer of value
12:49across the globe is still facilitated by
12:52xrp and The xrp Ledger or is it a blend
12:56of both structures where you have xrp as
12:59that King SDR or World Reserve currency
13:01and it's the payment rails for all the
13:04value that's being transferred around
13:05the world in this way a xrp would kind
13:08of just work like the US dollar does
13:10right now but with the exception that it
13:12is now backed by physical assets and
13:14potentially up to 20 Commodities
13:16actually using it to transmit value but
13:18then the other bucket is effectively
13:21like the escrow right it's the it's the
13:23what is held off Market in order to
13:27store value and
13:30um if if people approach the the
13:33thinking of the value from a completely
13:35transactional side then they're they're
13:38just going to see the price is too low
13:40because if it gets into all how fast it
13:43goes and all stuff you don't you don't
13:45need to hold it that long and all this
13:47and it can be used over and over and
13:48over and all that is true but at some
13:53because it's being used so predominantly
13:56in the marketplace there somebody thinks
13:59to themselves I'm just going to hold a
14:02little bit because it's gonna it's
14:05because it's being used for transactions
14:07I'll be able to use it for transactions
14:09in the future and that's called a store
14:11of value use case as soon as that
14:14you basically start this um
14:17what we call the uh virtual cycle yeah
14:21of It kind of pinging back and forth
14:23against these use cases until
14:24equilibrium can be established so
14:28um if if there if there is use as a
14:30store of value it almost necessitates
14:33the prices set very very high because of
14:36how easy it is to work around this whole
14:37you can't back a digital asset with a
14:40physical commodity by way of simply just
14:42tokenizing a new token on the blockchain
14:44and pegging that directly to the
14:46physical asset or commodity itself
14:48creating a backing via tokenization I
14:51feel like this is a debate we don't even
14:52need to be having right now anything
14:54will happen if the powers that be want
14:56it to happen but to me it just
14:58reiterates the point
15:00Ripple called their xrp a world deserved
15:03digital currency or said that they
15:05wanted to make xrp award Reserve digital
15:06currency and I I identify my xrp as a
15:11reserve currency on my balance sheet as
15:13well I understand that my bags are a
15:15little bit smaller and people are like
15:17okay cool story Zach you call it a
15:18reserve currency congratulations
15:21but that's that's the argument that
15:23we're having right now is it an esdr is
15:25it a reserve currency well Ripple's an
15:27institution that's calling it a reserve
15:29currency and they're treating it like
15:30one and how they're Distributing the X
15:32the xrp from the escrow account and how
15:34they're returning 80 of it back to the
15:38that to me signals that they might
15:40identify their xrp as a reserve currency
15:43yeah right but that these guys argue
15:46that because it's not in the code or
15:47because it's not official legal tender
15:49by the government that it can't be the
15:52reserve or you know if if they can't
15:54find it on a document or if they can't
15:56see it in the code it's not real so can
15:58they back xrp with gold well sure if
16:01they wanted to one thing I do think they
16:03want though is to go to a more stable
16:06Financial system is is we don't know
16:08what their plans are with xrp
16:10right and we've seen some pretty
16:12interesting things that lead us to
16:14believe that they're interested right
16:15some institutions like R3 try to get 5
16:18billion and that's just R3
16:21so this is why we're having
16:23conversations with the lawyers to
16:24understand how we can protect our our
16:26assets here especially in the United
16:27States where we have a precedent of them
16:30outline us owning gold and doing a
16:33buyback and doing a set price
16:36so when people say that you know we're
16:38just just crazy for for having
16:40conversations about protecting our
16:41assets I think that's so immature and
16:44it's really unfortunate because it
16:45misses the point on why we're having
16:46this conversation this is an
16:48inevitability we need to position
16:50ourselves in the assets that are going
16:52to be used in this new system my
16:54personal bets are placed with xrp xlm
16:57and xdc but there are a range of others
17:00that you might be interested in and I
17:01suggest you probably watch this video to
17:03find out what they are there is actually
17:05another inevitable technology that's
17:06coming and it's
17:13I'm going to explore this topic in the
17:15next documentary video what they don't
17:17want you to know about Central Bank
17:19digital currencies
17:25these videos take a long time to put
17:28together so if you want to support the
17:29creation of videos just like this
17:31consider joining as a member on this
17:33channel two ways you can do it you can
17:34just join the Discord using the link in
17:36the description and follow the
17:37instructions there or you can click join
17:39next to the Subscribe button you'll be
17:41able to join a community of people who
17:42are like-minded they do their research
17:44they listen to others opinions and we
17:46essentially form this community of
17:48researchers and it's a very valuable
17:50place to be and if you enjoyed this
17:51video you might want to consider
17:53watching this one this is where we talk
17:54to experts around the world about what
17:57price they believe our precious xrp will
17:59be worth in the coming years there's
18:01something for everyone and every point
18:03of view in that video so go and have a
18:10look at that look at that thumbnail
18:12don't you want to click it
18:15good it's a good video trust me go on
18:18I can wait here forever
18:20I'm not going to I'm going to go now but
18:22you can go that way
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FAQs about This YouTube Video

1. What is the potential role of XRP as a world reserve currency?

The potential role of XRP as a world reserve currency is explored in the video, discussing its distinction between backing and pegging, as well as the increasing interest from central banks and institutions in cryptocurrencies like XRP. The narrator emphasizes the need to position oneself in assets that will be used in the future financial system.

2. How can XRP be backed with physical assets such as gold?

The video discusses the possibility of backing XRP with physical assets such as gold, highlighting the potential of leveraging physical assets to support the value of XRP. It explains the concept of backing and its implications for the cryptocurrency market.

3. What is the distinction between backing and pegging in the context of XRP?

In the context of XRP, the video explains the distinction between backing and pegging, shedding light on the different mechanisms of supporting the value of the cryptocurrency. It emphasizes the potential impact of these concepts on the future financial system.

4. Why is there increasing interest from central banks and institutions in cryptocurrencies like XRP?

The video highlights the increasing interest from central banks and institutions in cryptocurrencies like XRP, discussing the reasons behind this growing attention. It delves into the potential benefits and implications of central banks and institutions embracing cryptocurrencies.

5. How should individuals position themselves in assets for the future financial system?

The narrator emphasizes the need for individuals to position themselves in assets that will be used in the future financial system, providing insights into the strategic approach to navigating the evolving financial landscape. It discusses the considerations for positioning in assets with long-term viability and relevance.

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