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Some of the biggest names in the crypto industry shared the spotlight at The B Word conference. The list includes Tesla, Inc. (NASDAQ: TSLA) CEO Elon Musk, Square, Inc. (NYSE: SQ) and Twitter, Inc. (NYSE: TWTR) CEO Jack Dorsey and Ark Invest’s Cathie Wood. Below is a highlight of some of the key takeaways from each participant.
Elon Musk
‘Thinking about money for a long time’
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Elon Musk said he has been “thinking about money for a long time.” He certainly has plenty of first-hand experience in money transfers as the co-founder of PayPal that was designed to transfer funds in real-time Aside from PayPal, money tends to move slowly as exists “in a series of heterogeneous databases,” he said. As such, moving money from one end of the world to another could take up to five business days, if not longer. The existing financial system also suffers from security flaws. Musk added:
I think it makes sense to support something that improves the quality of information with which we conduct the economy, and Bitcoin is a candidate for that.
Negative interest rates ‘drive me crazy’
Europe’s negative interest rates “drive me crazy” because it means that Tesla’s bank balances mean “we’re paying them to hold our money.” Typically, if inflation spans 2% and interest on cash generates a 1% return then the holder is really only down 1%. But if inflation is 2% and Tesla is forced to pay another 2% due to interest rates, it is “insane” how money essentially disappears.
‘Really hate the government’
Musk has a simple message for the many people who consider themselves against corporations yet pro-government. In reality, the government is the “biggest corporation of all” with a “monopoly on violence.” He added:
So if you don’t like corporations you should really hate governments.
This isn’t the first time Musk equated governments with corporations. In late 2020 he said that the government’s role in encouraging economic development should be akin to a “referee.” The problem is in many ways governments want to be the “referee” and “a player on the field.”
Cathy Wood
‘Started talking about this thing’ called Bitcoin
Cathy Wood’s curiosity in cryptocurrency dates back to 2011 when her firm’s Director of Research Brett Winton “started talking about this thing” called Bitcoin. After extensive research she felt that Bitcoin could prove to be a payment platform “the internet neglected to build into the system”.
Wood asked her mentor Art Laffer to collaborate on a paper and he was “a bit of a naysayer at first.” But the famed economist quickly changed course and said this is a “monetary system I’ve been waiting for my entire career.”
Bitcoin will be ‘much more environmentally friendly’
Asset managers have come under increasing pressure to promote ESG (environmental, social, governance) practices as much as possible. Wood said that Bitcoin is moving in the direction in which it can be “much more environmentally friendly,” especially when compared to traditional gold mining or the financial services sectors.
She continued that in some ways Bitcoin already satisfies social considerations. For example, global remittance is a $700 billion industry, and moving money around to countries experiencing double or even triple-digit inflation comes with costly fees, both direct and indirect. Bitcoin could save people on large transfer fees charged by financial institutions as well as from the “destruction of their purchasing power.” This is “certainly a noble social goal,” she said.
Jack Dorsey
Bitcoin can ‘replace the whole foundation’
The current payment network was built “with very different agendas” during a “very different time frame,” Jack Dorsey said. It is difficult to understand who outdated transfer systems like ACH “still exist” today as they are “not relevant to the future.” He said:
If the internet gets a chance to get a native currency what will that be? And to me, it’s Bitcoin.
Bitcoin incentivizes energy innovation
Current sustainability concerns related to Bitcoin mining could incentivize energy companies to create new solutions. One example is a company called the Great American Mining that caps the methane flares on oil fields to power their rigs.
This is part of the bigger conversation that is “missing” out and deserves more attention.