Brian Armstrong on the Crypto Economy | Conversations with Tyler
Brian Armstrong, co-founder of Coinbase, shares his insights on the crypto economy, the potential of decentralized systems, and the importance of a company’s mission.
He also discusses the role of Bitcoin, the potential of Ethereum 2.0, and the impact of central bank digital currencies.
A company’s mission statement serves a purpose beyond just following the law and maximizing profits.
It aligns the company towards creating something good in the world, attracts people who share the same vision, and helps to build a healthy company culture.
Vision vs Profit
There is an inherent tension in all companies between the ultimate vision of the world that they want to create and the need to generate profits.
A company should be willing to consider opportunities that may not align with their current mission statement if they have the potential to generate significant profits.
The thing that we did early on was that we decided we were going to be reaching out proactively to regulators not waiting for them to come to us and when we reached out to them proactively we tried to be an educational resource and we tried to be basically legitimate. – Brian Armstrong
Bitcoin may not be the medium of exchange unless layer two solutions start to work.
If these solutions do not work, Bitcoin will likely remain as a digital gold, serving as a large, slow-moving asset that people turn to in times of uncertainty.
There is no intrinsic value to Bitcoin.
It is valuable because people perceive it to be valuable and because it is useful for certain things.
The value of Bitcoin could be tied to the right to access a global decentralized ledger.
The Ethereum 2.0 rollout will offer scalability, which is one of the most important and underrated aspects of cryptocurrencies.
This will lower the friction of transactions, leading to new use cases.
Central Bank Digital Currencies
Central bank digital currencies are complementary to crypto.
They are an endorsement of blockchain technology and decentralized cryptocurrencies offer the potential for a more global, free, and fair economy.
Stable coins, which are crypto assets linked one-to-one with a fiat token, make sense for decentralized exchanges and for people in countries without stable currencies who want to have a dollar-denominated account on their smartphone.
Facebook’s Libra Project
Facebook’s forward-thinking approach in embracing blockchain technology with its Libra project (now called Diem) is commendable.
The negative reaction from the US government was unfair and the US should continue to innovate in this area to avoid losing its reserve currency status due to a miss in technology adoption.
San Francisco’s Prospects
The short-term prospects of San Francisco and the Bay Area as a home for tech are bearish due to current challenges.
However, the area will recover in the long term after a period of correction and revitalization.