- According to Charles Hoskinson, Cardano will serve as a global financial operating system to enable the population to maintain value, identity and governance in a single framework.
- Smaller to medium-sized countries will have an interest in implementing the blockchain in order to be treated fairly in world trade.
In the Slot Leader Podcast, Charles Hoskinson talked about the reasons why the world needs a new “financial operating system” and why governments and corporations should build on open blockchain platforms like Cardano. As the inventor of Cardano explained, mankind has reached a point where more and more people understand that the current financial system is “bad”.
In particular, the world reserve currency system is doomed to failure. According to Hoskinson, there are two options, either there will be a “one-world currency” or private currencies will compete with national currencies. Ultimately, the current status is a challenge to develop the financial operating system of the future:
We gonna either have a one world currency or we gonna have private moneys that compete with national currencies but it makes no sense for one country to be the world reserve currency […]. And then you think about finance in general and you say, the way we are doing banking, we are doing credits, the way we do credit scores. All this stuff is really bad.
We need to improve it […] and turn it into a kind of darwinian marketplace where you have thousands of competing ideas. They fight each other and eventually the survival of the fittest, those one will come to the top and we can rebuild the world’s financial system.
Cardano is designed as a global financial operating system. According to the CEO of IOHK, it is a collection of protocols, software and hardware that enables the population to represent value, identity and governance in a single framework. It is designed to give an identity to those who have no economic identity.
It will also be able to issue stocks, bonds, commodities, currencies and utility tokens, as well as perform KYC and AML and build reputation matrices. Ultimately, it enables “real control over who pays and who controls Ultimately, it is an identity that no government can take away from you. Specifically, Hoskinson described the vision for Cardano as follows:
The general idea is that the system shoud be an end-to-end stack for economic identity. So what that means is that if some person in Senegal or some person in Ruanda or wherever enters the system, they should be able to have some place to place their data, their identity, to build a reputation. They should have some way to get credit, they should have some way to interfacing with a currency that is reasonably stable, they can send to anyone in the world.
They should have the ability to interface with exchanges, have a business, they should have the ability to securitize that business. So they have banking services, insurance services, credit services, remittance services but the it also includes a governance stack, for example when they want to do shareholder votes with a governance layer, they can reuse the Voltaire system […] It’s a one stop shop.
As Hoskinson explained, Cardano as a system can be very interesting, especially for small to medium-sized countries, in order to be treated fairly in the global economy. Contrary to the assumption that transnational organizations such as the World Bank, the World Trade Organization, the IMF ensure fairness, they are also only controlled by the large countries. Smaller countries therefore have a sovereignty problem, which Cardano can solve as a blockchain:
To that extend they don’t even have sovereinity, […] and then a trans-national body comes to you and […] you will be blacklisted and in some cases you have regime change like Gaddafi and Lybia after the wanted to go for the gold standard. […] So the whole point of blockchain is, you say ‘hey no one is in control’ and its intrinsicly appealing as long as there is some notion for regulation in the system, but its regulated within the system.