Welcome to season 2 of the NZ Everyday Investor!!!
In the first episode of season two, we're talking about the future of money.
Are the current, mainstream, and orthodox ways of building wealth, fit for purpose in the new world?
Will the new world be simply more of what we’ve seen already, or fundamentally different? If we think it’s the latter, shouldn’t we be open to new strategies around building wealth and more importantly, storing wealth?
So on to today’s episode, what are we discussing?
The future of money
Libra is a new cryptocurrency brought to you by Facebook. Yes, that portal that gives your folks way more insight into your life than you’re comfortable with is teaching your parents how to use digital currency. Heck, I still get calls to fix my mum’s wifi so yeah, thank you Facebook! Libra - a digital currency that uses blockchain technology to protect and to verify transactions. In theory, Facebook will launch Libra next year, but there’s a lot of water to go under the bridge between now and then. People who use Facebook's Messenger service, WhatsApp, or who download a stand-alone app will be able to Libra through a digital wallet.
Bitcoin is likely the best-known cryptocurrency at the moment, but in terms of wide-scale adoption, it’s still not mainstream. The recent price action on Bitcoin has garnered some attention again (not always the good kind), but now with Facebooks version, perhaps now there’s a new onramp that will assist in mass adoption. Libra could bring a huge amount of interest into the cryptocurrency space. What impact will this have on the incumbent financial systems: Banks, governments, tax departments, stock exchanges and other financial service providers to name a few?
To read one of the best articles around Libra, check out https://medium.com/swlh/libra-a-balanced-view-i-89c985c57aa8
Facebook has 2.7 billion users worldwide.
About half of the population of the world, or 3.75 billion people, don’t have a bank account (https://qz.com/1299292/financial-inclusion-nearly-half-of-the-worlds-population-still-doesnt-use-a-bank-account/
30 to 40 % of 24 to 35-year-olds are active on Facebook.
There are more than 25 eMoney systems in the world currently, with transactions exceeding $18.7 trillion (this is more than Visa and Mastercard combined).
This space is HUGE!
In this episode, I sat in on the NZ Tech Podcast with Paul Spain, tech guru with Gorilla Technologies and Andy Higgs, GM of a company called Centrality.
A couple other points to leave you with…
You may have picked up that in these podcasts, you don’t get topics that are always mainstream – today was a good example. I think it’s essential that more Kiwi’s get their head around this sort of thing though, and waiting for the mainstream media to cover it is far too late.
I sense the early stages of a sea change coming with respect to our current monetary system. The pace of change scares me a little.
A question you should really ponder around this:
Do you think Libra, or cryptocurrencies in general, will one day replace our fiat currency?
This is what money should do…
1. A unit of account
2. A medium of exchange
3. A store of wealth
If Libra can do these jobs well, then maybe there’s something in this.
One more thing: I’m happy to go down on the record here as the guy who said that at some stage, possibly sooner than we’re comfortable with, faith will increase in forms of money that are not backed by central banks. If you believe this as well, would it be wise to rely on an investment portfolio exclusively denominated in fiat currency?
Did I mention none of this is financial advice?
NZ Everyday Investor Podcast:
We’re keeping it real on NZ Everyday investor – we’re not journalists and this isn’t an interview – it’s a discussion, hosted by someone who’s genuinely into this sort of thing. If you like what we do, remember to subscribe to our show and share it with others – we’d really appreciate it! Do you know what else would make us rather pleased with ourselves? Write a review on facebook too!
Where to find Darcy Ungaro:
Ungaro &Co (registered) financial advisers https://www.ungaro.co.nz
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