The pace of technological change is growing year on year. Who would have thought even 10 years ago that the digital money and cryptocurrency sector would be valued at over $2 trillion globally!
The space is huge, and, is only going to get bigger as technology plays a larger role in our lives in the decades to come. These technologies are not going anywhere.
Our duty now is to utilise these technologies to help tackle many of the worlds most pressing issues. How can digital money help tackle poverty in local communities across the world? Can Crypto help fight hunger? What role does Cryptocurrency play in achieving the sustainable development goals?
These are not simple questions, and they may not even have answers. But they are still the most important questions to ask of the crypto space. It is just these questions that we put to the director of the Nano Foundation.
I am George Coxon. I am the director of the Nano Foundation. Nano is decentralised digital money with zero fees and instantaneous transactions over a decentralised, secure network.
We’re having this conversation because of what Nano brings to the world as a technology and as a global currency. There are 5 billion people in the world that do not have an address, and therefore cannot participate in the global economy that we take for granted so much. Through Nano, we are able to give everyone in the world the right over their own money anytime, anywhere with just a smartphone and internet connection.
What is Nano doing for a more sustainable future?
When people think of digital money, and they think of crypto, they immediately think of unsustainability. What’s different about Nano?
Nano was born in 2014 with Colin LeMahieu, Nano’s founder, having watched the onset and the arrival of digital money in the form of Bitcoin however, despite being revolutionary, there were obvious inefficiencies when it came to using Bitcoin as real digital money in the real world.
The ongoing debate around energy consumption in the cryptocurrency space has been long and drawn out however in my opinion, is not about who is right or wrong, it is fundamentally about progress. If a better solution comes along that uses less energy than the former, you use it – that has always been the case with technological progress through the ages.
If people took off their rose-tinted glasses when it came to personal investments – the facts show that Bitcoin’s energy consumption is unsustainable, it is as simple as that. 1 Bitcoin transaction consumes on average 1726.51 kWh . Arguments around the energy consumed for the bitcoin network revolve around statements such as, ‘it uses renewable energy so it’s fine’ or ‘It’s fine because the energy being used has already been created’ – this is the creation of a positive feedback loop of support and misguidance in front of our eyes.
The defence statements themselves may not be factually incorrect, it doesn’t really matter. My point is that if there is a technology that has burst onto the scene, whether cryptocurrency or not – that is not looking towards an energy sustainable future of the world, then more innovation needs to happen to make it so.
Nano has proven that mining is unnecessary. Nano has an energy footprint for 1 transaction being 0.00012kWh and a whole network that could run off a single wind turbine (which by the way produces on average 3MWh) – to put this into perspective, that is 15.5million nano transactions using the same energy as a single bitcoin transaction.
I personally think we should all be concerned about ESG and make appropriate decisions whether on an individual or corporate level to tackle the climate crisis we are now in, this is not a dystopia, we are here now and action needs to be taken alongside accountability for those that do not fulfil their promises for a greener future. There is no point in having money in a world that does not exist.
In this light, the Nano Foundation in 2019 helped sponsor a leg of the fossil-fuel-free journey of National Geographic filmmaker James Levelle who travelled from London to Chile collecting stories from the global youth of today on their thoughts on the current global climate action and in their
minds, what needs to be done; giving a voice to the next generation through a feature-length film to whom we owe a green and sustainable future. This film will be shown at the upcoming COP26 in Glasgow and aims to highlight the voices of the next generation of climate activists and that we need
to act NOW!
On the energy front as well, I did want to point out all the digital money firms that support and facilitate non-sustainable technologies yet have their tag line being ‘bank the unbanked’ or USP to provide banking for those in emerging economies – it is those people that you are supposedly trying to help that will feel the largest brunt of climate change and responsibility to not using or facilitating greener solutions must be taken.
Digital money should not cost the Earth.
People could be excluded for very hard structural issues
Let’s take an example, people in, let just say, rural India where millions of people live in shanty towns and are very hard to engage. Across the world, there are billions of people in this state. So what’s the way digital money can do something about that? And I know that in the past one size fits all solutions and often failed in the local context. So how can Nano avoid such a situation?
Back in 2016, this is a great example in India, the government removed two notes out of the rupee system which equated to 86% of the country’s cash supply. Now, the reason being for doing this was to combat ‘corruption’ within the country. So for that to happen, they gave only 12 hours’ notice to the whole country to basically hand in these two notes if you had them and exchange them for something that would be usable.
Now, who this actually affected were not those in positions of power with corruption at their core but normal people, those in lower socio-economic areas, especially rural India and especially women, women who had been married young or were trapped in abusive relationships and had no right over their own money, who had to physically and in-person queue up at banks to exchange their savings (that is, if they’d even been notified of this, we’re talking about rural India where there can be very little connectivity) which can be a death sentence in various cultures.
Now, this is where a decentralised currency is absolutely needed. Because no one can shut it off. No one can restrict your access to your digital money. By using Nano you have that right directly on your smartphone (and with an internet connection). Decentralisation in the cryptocurrency space is illustrated by what’s called the Nakamoto Coefficient – how many entities or network participants are needed to take over control of a network; Bitcoin has a coefficient of 3-4 entities with mining pools being the largest player, Nano has a current Nakamoto Coefficient of 11 meaning that Nano is nearly 3x more decentralised as a network than Bitcoin.
So wherever you are, you can be your own bank, you can have a right to have your own money and send, receive money in under a second, anywhere in the world, without fees.
Nepal is among the top 10 countries to receive remittance, having received a total of $7.8 billion in remittance in the fiscal year 2018/19, contributing 25.4% to the national GDP of $29.8 billion. Remittances from Nepali workers abroad have continued to increase exponentially with an average of 15% growth in remittance every year however foreign workers pay an average of 6.8% in fees to transfer money home. We believe that you should be able to send money anywhere in the world, in under a second, for free.
So to answer your question, Nano is a tool to be used as and when you wish to use it. In the Western world, we are spoiled with remittance options and competitive fees and therefore Nano is a ‘nice to have’ option or choice. In emerging markets, Nano is a necessity, fixing a real-world problem which is banking accessibility, extortionate fees for remittance and huge settlement delays and risk. Nano, therefore, despite being a single technology, is here to be used globally in whatever way works for you – everything that money touches, Nano can do better.
Would a decentralised currency be more prone to fluctuation?
And I’m thinking for example of Elon Musk’s ability to send a tweet and spike or crash the price of crypto because no one’s in control. It’s like a free for all! So how does that get prevented?
All currencies are volatile. Those with large swings in supply due to monetary policy or large swings in demand due to low market cap will thus be more volatile, cryptocurrency and fiat alike. Since nano has a fixed supply, volatility due to supply is nonexistent leaving only the need for stable demand from widespread usage.
As the utility of cryptocurrency comes to the foreground and the speculative market starts to fall away over the upcoming years, it will be very interesting to see which coins/tokens or technologies survive in the long term. We believe that utility is at the core of longevity.
What has been the issue with digital money and its use for nefarious purposes?
I think it’s worth noting that cryptocurrency and digital money as a whole is less than 1% of the whole global economy. There’s a long way to go before we actually see crypto, not just a headline in the media, but used to fix real-world issues on a global scale.
Cryptocurrency has enabled people to monetize illegal activity online for the first time when it comes to ransomware hence the increase of headlines pertaining to these nefarious activities however cash is still king when it comes to money; laundering. Contrary to popular belief and what the media feeds the public, cryptocurrency is not the usual arena for money laundering activities. Bitcoin accounts for only $2.5 billion of money laundered which is significantly smaller than the annual $1 trillion money laundering statistics estimate we lose in fiat currencies.
Is there a specific piece of legislation you think is really missing to stabilise the digital money and cryptocurrency space?
On a global level, when it comes to regulation, every jurisdiction has its own wants and needs when it comes to regulating cryptocurrency or indeed looking at digitising the pound euro or dollar or various other fiat currencies.
My frustration currently is not so much with what the regulation is, because that is yet to be decided on multiple levels across multiple jurisdictions, it is actually those who are in charge of forming regulation – are they truly informed as to what technology is out there in an unbiased way? The current landscape is the lobbyist landscape, meaning that those companies who can pay for lobbyists to governments are the ones whose technology is being considered. This is not a fair and equal playground if we are all trying to reach the same goals when it comes to baseline technologies.
The proposed HMT Travel Rule which aims to remove.
Regulators need to focus on not stemming innovation when it comes to digital money creation or the technologies behind it. The UK and, London especially, has the opportunity to become a global hub of blockchain technology however this is currently dependent on those in power truly putting innovation at heart and not focusing on trying to retain incumbent power balances.
There’s definitely a lot of work to be done for sure.
What is the message to young professionals who hear your story?
So my main number one, which I always say is you’ve got to fix a real-world problem and don’t create a solution to a problem that doesn’t exist. That’s really where utility and longevity is formed.
To be different requires thinking outside the usual rules of the world stage and often requires taking the hardest road. Something that is wholly novel and unique will most likely face the most challenges. What’s the common phrase used? It isn’t easy changing the world, otherwise everyone would do it.