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Episode 22, available on Spotify, Apple Podcasts, and YouTube

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“The blockchain technologies they're laying down and (the) infrastructure (is) so that you can do things easier, faster and cheaper. That's the potential.”

Today’s episode of Keep Talking features Cesare Fracassi, Director of the blockchain initiative at the McCombs School of Business - University of Texas at Austin. Cesare talks about centralized and decentralized (or distributed) ledgers, blockchain as a distributed ledger, the fundamentals and benefits of cryptocurrencies and blockchain technology, and the challenges faced by the crypto industry at present. He also weighs different cryptocurrencies with their pros and cons and shares his understanding of the future of cryptocurrency.

About Cesare Fracassi (Quote from www.edx.org):

“Cesare is an associate professor of finance and the director of the blockchain initiative at the McCombs School of Business - University of Texas at Austin. His primary research interest is in corporate finance. His research, published in the top Finance journals, includes work on fintech, corporate governance, credit rating agencies, small business financing, and the effects of social networks and culture on financial policies.”

Time Stamps:

(00:00) Intro
(01:10) Get to know Cesare Fracassi
(02:13) How did Cesare get interested in blockchain technology?
(03:54) Cesare explains his background in technology, developing interest in fintech and blockchain, and becoming the Director at a blockchain institute
(07:42) What is meant by fintech?
(09:14) Cesare explains the growing trends in blockchain technology
(12:19) Centralized vs. distributed ledgers
(12:54) Understanding centralized ledgers
(14:02) Understanding decentralized ledgers and their evolution
(16:23) In the case of decentralized ledgers, how does the whole network decide if a transaction is valid or not?
(17:50) How Satoshi Nakamoto discovered a way for every node in a decentralized network to evaluate transactions as legit or not
(18:51) The two challenges in allowing every node in a decentralized network to vote: 1) No centralized vote-counting system, and 2) Sybil attack
(20:34) The solution to enabling transactions through decentralized networks, according to Satoshi Nakamoto
(23:22) How Bitcoin turned out to become “digital gold”
(30:54) What according to Cesare, is the best cryptocurrency to buy today?
(34:09)  Is it possible to reverse engineer Bitcoin to provide the benefits that Ethereum does?
(36:16) What makes Ethereum smart contracts superior?
(39:11) Where are we, at present, with respect to the development of cryptocurrency? What does the future hold?
(46:58) What's the easiest way for people to enter the crypto world?
(47:32) What is meant by Internet 2.0?
(49:34) What would the future look like if cryptocurrency evolved the way experts think it might?
(54:26) Does Cesare believe cryptocurrency holds an opportunity for further growth?
(59:04) What is a Private Permission Blockchain?
(01:01:02) What would be the end result of a massive blockchain transformation?
(01:06:33) Does cryptocurrency have the potential to improve our civilization and people's lives?
(01:09:15) Blockchain resource recommendations from Cesare

Quotes:

“Centralized means (that) there is just one single entity that owns the ledger, (and it) decides whether a transaction goes on the ledger or not... There's just one person. So when I go and buy coffee, the bank is the one in charge of deciding if this transaction is valid or not... If I don't have the money, or if somebody uses my card fraudulently, the bank stops the transaction.”

“(In the case of centralized ledgers) there is always a central party that owns the ledger and decides whether the transaction is valid or not.”

“The idea is that everything is split into blocks. That's why it's called a blockchain. So let's assume there is a new transaction... the transaction gets put into blocks, and then all the transactions to the blocks, get verified by each one of the nodes in the network.”

“The answer (to the problem around decentralization of ledgers) is proof of work.”

“You're gonna vote… but your vote is proportional to how much work you have done (and) how much computing power you used to solve these cryptographic puzzles.”

“In Bitcoin, you can simply send the money from person A to person B, but you cannot attach any condition to that. In Ethereum, through smart contracts, you can say, hey, send money from A to B, only if all these things (conditions) happened. This simple difference created an immense ecosystem of what are called decentralized applications.”

“The only reason why gold has value is that other people think gold has value.”

“In order for bots to really help our lives, they need to have a payment trail that is linked to code, and crypto can do that... now. But it's very expensive.”

“The blockchain technologies they're laying down and (the) infrastructure (is) so that you can do things easier, faster and cheaper. That's the potential.”

Relevant Links:

People mentioned (quotes from Wikipedia):

  • Satoshi Nakamoto - “Satoshi Nakamoto is the name used by the presumed pseudonymous person or persons who developed bitcoin, authored the bitcoin white paper, and created and deployed bitcoin's original reference implementation. As part of the implementation, Nakamoto also devised the first blockchain database.”
  • Bill Gates - “William Henry Gates III is an American business magnate, software developer, investor, author, and philanthropist. He is a co-founder of Microsoft, along with his late childhood friend Paul Allen.”
  • David Letterman - “David Michael Letterman is an American television host, comedian, writer, and producer. He hosted late-night television talk shows for 33 years, beginning with February 1, 1982, the debut of Late Night with David Letterman on NBC, and ending with May 20, 2015, broadcast of Late Show with David Letterman on CBS.”
  • Vitalik Buterin -  “Vitaly Dmitriyevich 'Vitalik' Buterin is a Russian-Canadian programmer and writer who is best known as one of the co-founders of Ethereum.”
  • Steve Jobs - “Steven Paul Jobs was an American business magnate, industrial designer, investor, and media proprietor.”

Connect with Cesare:

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