Meng Yan: Zha Xiaoge, can you still be more sharp? 丨SheKnows in-depth interpretation of Libra white paper

On June 18th, Facebook released Libra's white paper on the blockchain project. It was the king of the world. For a time, Libra’s tsunami swept the cryptocurrency and even the entire financial and technology industries. Before the publication of the white paper, the article "Facebook Digital Currency: Origin, Significance and Consequences" also made people scream. On the evening of the 19th, Sheknow community interview column SheKnows specially invited the author of the article, the promoter of the certificate economy, and the vice president of CSDN, Meng Yan, to deeply interpret the white paper.


Golden sentence highlights:

1. The biggest application of the blockchain is open finance, which is to break a small group of people in high-end conference rooms to determine the financial rights of most people. When Libra came up, he picked this out and was very courageous.

2. There is a small part of the FB currency that the Chinese will be nervous, worried about backwardness, not backward technology, and ecological backwardness.

3. Idealists and businessists are important and will ultimately work together to create the future of finance and the economy.

4. In the digital economy, all applications are financialized and there is no need to worry about collecting money.

5. FB currency is good for BTC in the short-term, ETH and EOS will definitely be competitive; in the long run, Libra will drive a new type of digital assets and a set of incentive systems with debt and interest as the main form.

6. FB mainly faces two major risks: the first is the issue of securities identification, and the second is the issue of anti-money laundering, anti-corruption and anti-terrorism.

7. Calibra's centralized management of user private keys is a compromise between Libra and a realistic approach.

8. The value behind Libra, early is the ability to convert to legal currency, the future is people's liquidity trust.

9. Several words summarize Libra's spirit: openness, rebellion, and arrogance.

10. Free encryption of digital currency will always have a place, the advantage of the giant is their disadvantage. The following is an interview record:

About Libra itself

Q1: The Facebook Cryptographic White Paper was released with the mission of building a simple, borderless currency and financial infrastructure for billions of people. Transferring money globally should be as easy, cost-effective, and even safer as sending text messages or sharing photos. Once it comes up, it is directly open source, and it encourages third parties to develop applications and financial services as soon as they come up. It can be described as magnificent. Please explain directly to Teacher Meng Yan. What is the most shocking and unexpected for you? What do you think is there?

Meng Yan : There have been many interpretations since this day. There are many high-level analysis, technology, performance, and Move language. I will say two things.

First, the white paper is relatively naked about the financial opening, which is beyond my expectations . I originally thought that it would be more subtle. After all, you just came out and have not grown up. It is more reasonable to pretend to be a grandson. Don’t make such a bitter and deep enmity, then it is revolutionary. The result is that it doesn't, as soon as it comes up: Libra's mission is to build a simple, borderless currency and financial infrastructure that serves billions of people. Zha Xiaoge, can you still show off a little more?

The first section of the first chapter of the white paper, entitled "Opportunity." This title is very funny, it must be confused, what is this opportunity, this is the "vision and value proposition" is good? The full text is very popular, and everyone pays special attention to these two sentences: "There should be more people to enjoy the right to access financial services and cheap capital" and "the global monetary and financial infrastructure should be designed and managed as a public product." What is this about? It is open finance.

I have recently participated in several briefings on international blockchain projects, and I have heard that open finance, borderless finance, and financial democratization are all meanings. Explain that the leading figures in the US blockchain and digital currency are slowly reaching a consensus. The biggest application of the blockchain is open finance, which is to break a small group of people in high-end conference rooms to determine the financial rights of most people.

It turns out that there is no means. How long can you take Wall Street for a few months? You said that my current finances are not doing right. Do you guys say this to me? Nothing? Stay for a few months, then cool where to stay. The blockchain now gives a new technology infrastructure, a new option. Libra picked up this purpose as soon as he came up. It was really courageous, and I admire it.

Yesterday, I said in a circle of friends that it is more powerful than I thought. The old friends in several circles said to me personally, are you confused or really confused, such a thing, the alliance chain, BFT, 1000 TPS, mobile Paying, you can make a move, others are innovative, and you are so excited. Why are you so excited? I said that it was not the same thing at all. I said it was so powerful that I did not expect him to dare to show up the battle when he came up .

As for doing this right, I don't know. This is not the case in the United States today, some members of the United States jumped out to call for its suspension? Wall Street must have a bunch of people to die. Sometimes it is troublesome to be not good at hiding the front. But there are also benefits. When the flag is lit up, there will be more people supporting it. Its entire governance structure and economic model are also open to what I expected, and will receive a certain degree of support.

The second point is the dual currency structure, Libra + Investment Token . This is the topic of my interest in economic incentive research. My own research results show that the single-coin model cannot be stable and must be ups and downs. So I have been raising double coins in the circle. This time I saw that his family is also a double currency, very pleased.

But I haven't figured out the details yet, so I'll wait until now. Q2: I see a lot of people in the circle of friends. Some BAT friends, there are some cynicism, some concerns, and some nervous. What do you think is the most nervous thing for the Chinese in this incident?

Meng Yan : Most Chinese are not nervous. There are more than two hundred messages in the background of my article. Because there are more than the restrictions, there are a lot of them that cannot be released. If you look at those messages, you will know. We are confident. I believe they can’t do it. I believe that American friends and friends from all over the world must join hands to suppress him. I believe that even if we do it, it doesn't matter to us. So what is so nervous, the world is too peaceful.

There is a small amount of tension and worry about falling behind. It is not backward technology, it is ecological backwardness . After two or three years, you will do another five times better than it, and there is no drama. So there is a sense of urgency. Just like the operating system, it is iOS and Android, and it is hard to get up later. Q3: Your article says: Facebook digital currency will be the most significant event in the field of encrypted digital currency after the launch of Bitcoin's main network in 2009, marking the upgrade of non-state-issued digital currency applications from 1.0 to 2.0. You have already mentioned a very high level of FB currency. Why do you make such a judgment?

Meng Yan : Teacher Zhu Jiaming said that it was the riots of the Germanic tribes. It is now the Roman legionary uprising. Go and see how the Western Roman Empire ended, and then tell me if it is 2.0? Some people are ignoring their fingers more than technical indicators, completely wrong. I know that your tribe also has good bows and helmets. Your strong man is more powerful than the Roman general. Congratulations! But sorry, the focus of this matter is not here at all. The focus of this rebellion is the Roman general!

About open finance

Q4: On May 17th, you once delivered a speech on "The Three Main Directions of the General Economy" at the "2019 Hangzhou Blockchain Summit Forum" held by Babbitt. It mentioned that doing open finance, three things are very important. One is the infrastructure of open finance, mainly refers to the technical aspects; the second is the open certificate-based incentive model; the third is open source supervision. In contrast to the Libra project, both the first and second seem to have reached. is it? what do you think?

Meng Yan : Open finance is a big topic. As for Libra, it is not completely achieved. After all, it is still a limit for admission. They announced that they would realize a non-licensed network in the future. I was surprised that the technical challenges were great and it was difficult to say whether or not I could deliver the promise. Pass-in incentives are also not open, because only the node has an Investment Token to mint coins. The issue of open source supervision is likely to happen in the future. This is really what the government needs to lead and take a look.

About business opportunities

Q5: When a giant like Facebook joins, the campaign will be upgraded from idealistic 1.0 to commercial 2.0. Idealism will always be part of this movement, but the power of capital and commerce will gradually play a leading role. What do you think of idealism and commercial power, which will generate energy in the past and in the future.

Meng Yan : Idealism has two parts, some of which are the first password punks to enter Bitcoin and some open financial fans, and some are 90 and 95. The former is clearly aware of where the red line is, feel unfair, and want to shock. The latter does not know what the red line is, and the newborn calf is not afraid of the tiger. These idealists will continue to do well in the areas of anonymous digital assets, public chains, mining, DeFi, and exchanges. Don't use the reason of the real economy to bind them. They will come up with new economic forms. Is mining not an industry that emerges out of thin air? Is DeFi and Staking not the same? There will be in the future.

Commercialism is different. It is a reformer, not a revolutionary . It tries to bridge the reality and ideals, bring the funds, talents and assets of the traditional world to the new world, and pay attention to the transformation of the new world to the real world order.

Both people are important and will eventually work together to create the future of finance and the economy. Q6: After the release of Libra, there may be many new business opportunities based on the underlying technology, such as Libra-based online payment, acceptance and transaction, Libra banking in third world countries, such as payment, lending, wealth management, etc. Bring opportunities, where do you think business opportunities are?

Meng Yan : I have said in the question, I also wrote a lot in the article. But I don't think it's about specific business. What we want to see is such a global financial infrastructure at your fingertips. In the long run, its opportunities are holistic.

Here I will say three things. First, infrastructure . My friend, Dr. Cao Feng, the founder of PChain, called me today and said that his PChain is ready to support Libra in a side chain. As a global financial infrastructure, Libra will not be made by a single company, nor is it the only way to choose it. It opened up part of the code to let everyone create the global financial infrastructure with it. If you are a technology developer and optimistic about Libra, you can follow up and do some infrastructure and basic services, such as the Internet of Things, 5G smart devices.

I have a great chance to judge it. One thing to note is that in a digital economy, you never have to worry about collecting money, because the Internet itself is a financial network, and there are too many ways to collect money.

Second, financial services . At the beginning, the big probability is that the unique models of DeFi and Staking are chained up to Libra. Later, financial services such as various insurances and funds are slowly moved up. By the time the open financial services are integrated, the overall advantage is very prominent. For example, if you want to create a song, you want to open a short video column, it may be easy to find someone to distribute, crowdfunding and even insurance. All applications will be financialized .

Third, community integration . I know that there are some communities in Southeast Asia that have been actively considering how to connect to the Libra ecosystem. For example, he is an e-commerce company. Why not take it in and let his members earn Libra?

I can imagine a lot. The three points I mentioned here are actually things that my friends are driving around, so let's just say these three things.

About the market and the integration with traditional finance

Q7: Will FB currency have an impact on digital currencies such as BTC and ETH? What might be the concrete manifestation?

Meng Yan : FB currency is good for BTC in the short-term, because more money comes in . In the long run, Libra will drive a new class of digital assets, as well as a set of incentive systems with debt and interest as the main form, and will gradually marginalize the traditional incentive model of skyrocketing. But in the traditional digital currency, BTC is the least affected , because it is simple enough and the foundation is a digital gold.

ETH and EOS will definitely be subject to competition , mainly because of traffic than Facebook. If the developer finds that you can only earn 1,000 pieces in your business and earn 5,000 pieces in Libra, you will definitely have a lot of motivation to transfer to Libra. We are also in a very complicated mood. We hope that ETH and EOS will be able to come up with new recruits under competition. Libra has not yet come out. Q8: Facebook has already assembled a number of industry giants. Will this trend continue in the future, will this trend lead to further separation of the mainstream world and the world of cryptocurrencies such as Bitcoin? How do you see the situation of the giants "individually"?

Meng Yan : Someone asked me if Google or Amazon will issue coins. I feel that its pressure is not as big as FB, not in the short term. But if FB puts thunder, not only does it die, but it still lives better. The problem is coming. If Google and Amazon come back to the currency at this time, it will not come, can they fight against the FB system? I judge that they are sure to get it. If they don't, they will become Facebook's subordinate departments.

If FB is broad enough, can you accept that the two giants come in and then sit on it? I think this is a particularly suspenseful issue. I have no answer now. But I said in the article, Mundell said that the best amount of money in the world is odd, less than three. However, Hayek believes that money marketization and hundreds of battles must be accompanied by several free currencies at the same time to obtain the throne and multiple standards. We can wait and see. See who the two masters are right. Q9: You mentioned in the article that the future FB is likely to assume similar responsibilities as the bank. Is this a status challenge for the bank?

Meng Yan : Is this still asking? It must be a serious challenge . It seems that it is not FB, it is Libra. FB seems to reflect a relatively big mind, and the interests are all with everyone. As for whether it will actually evolve into an oligarchy, let’s take a look. There is no doubt that the bank is very unhappy. They have been living for hundreds of years, why can't they be challenged.

About supervision

Q10: The US SEC's regulation of digital currency is very strict. What problems will FB issue face in terms of supervision?

Meng Yan : According to my understanding, Libra is a digital credit symbol, a kind of securities, and the SEC should be able to manage it. But what exactly does it do? I don’t know yet, the SEC hasn’t come out yet, and the congressmen have come out first. I think most of it, behind the big Wall Street banks are agitating. The main risk, the first is the issue of securities identification . Whether Libra is a security or not, Libra Investment Token is not a security issue, and the issue is not in compliance. The second is to act as a currency, anti-money laundering, anti-corruption, and anti-terrorism issues.

Many people are discussing Calibra today, saying that it centrally manages the user's private key, violating the spirit of decentralization. This accusation is no problem in the position of decentralized fundamentalism, and I also recognize it. But I think that Calibra is a live-action for future compliance, otherwise it will never pass the monetary regulations. Some friends say that the key is centrally managed in your hands, which is different from traditional banks? I might as well use traditional banks. The difference is big, traditional banks will not let you do applications on its core system? So Libra made a compromise, which I think is a realistic approach.

About "Stabilizing Coins" Libra

Q11: The white paper shows that Libra is fully supported by real asset reserves. For each newly created Libra cryptocurrency, there is a basket of bank deposits and short-term government bonds of relative value in the Libra Reserve to build trust in its intrinsic value. What do you think is the real value behind Libra as a currency unit?

Meng Yan : Early is the ability to be converted into legal currency. The future is people's trust in its liquidity . In fact, the most interesting part of your question is not the one you asked. The most interesting thing is that he put short-term government bonds in the reserve. This is too interesting. People who don't understand money banking don't know what it means.

Simply say it. The deposit reserve for commercial banks must be sufficient. That is to say, in the reserve account opened by the central bank, the cash must be sufficient to support enough credit. The central bank checks this every night. If not, what should I do? Commercial banks can't say that the central bank's mother, although I have insufficient reserves, but I have some government bonds here, let me pass. The central bank does not recognize your bonds and only recognizes the amount of reserves.

Therefore, commercial banks have to go to an inter-bank lending market, temporarily mortgage the bonds to other banks, borrow cash, and deposit them in the reserve account to survive the day. I got the money the next day and bought these bonds back. This kind of behavior is called repo, repo. The world's largest interbank dismantling market is in London. Its interest rate is LIBOR. It is familiar. Some people think that Libra is just like it. Because the European dollar interbank market is the largest in the world, LIBOR is one of the two most important interest rates in the world, and the other is of course the US federal funds rate. Our China's interbank lending market is in Shanghai, and the overnight dismantling rate is called SHIBOR. When you look at financial news later, you will often encounter these two acronyms.

If it does not start, the point here is that commercial banks cannot use short-term government bonds as collateral to issue credit. But Libra can. It can choose its own government bonds on the left side of the balance sheet and then issue Libra stable coins on the right. Whose privilege is it to choose the currency from which the mortgaged asset is issued? Look at my mouth type: the central bank. So Libra blatantly claimed that he had the privilege of the central bank, which was more fierce than I predicted in the article . I thought it would be like the USDT, first mortgage cash for a year or two, then change the white paper, join bonds and other assets. I did not expect it to be more anxious than me, admire .

USDT Everyone knows that the white paper was revised in March this year. In addition to cash, the left side can also put the bonds and other dollar assets of their choice. The result was a disaster, and the New York General Prosecutor’s Office is still checking it. However, it seems that there is nothing wrong with it. A few days ago, I also spent more than $100 million on Ethereum.

Therefore, many people in China heard that members of Congress had called for Libra to suspend, and they rushed to say that the United States had banned Libra. It was really worrying for the US emperor. In a country ruled by law, it is necessary to behave in a manner that rules things.

About the "white spirit" of the white paper

Q12: After reading the white paper, the spirit of open source, finance, and equality runs through the whole text. It also shows that Facebook stands at a height that solves the common problem of human destiny. It is also clearly stated in the white paper that openness is the essence of the Libra spirit. What do you think of the spirit of God? Can it be summarized in a few words?

Meng Yan : Open, rebellious, and sharp . Frankly speaking, Libra's specific solution is eclectic, but the white paper is very sharp .

Q13: Although Facebook is very concerned about this issue, it is understandable, but there is a faint question: the main blockchain technology, if the traditional Internet giant enters the market, it will start a huge wave, kill other The brilliance of the original blockchain project, is that a bit paradox, how do we rationally look at the giants' entry? ''

Meng Yan : No, freely encrypted digital currency will always have a place. The advantage of the giants is their disadvantage. Why did Bitcoin appear in 2009, and Libra did it only ten years later? In many directions, freely encrypted digital currency will always be the leader. What directions? Oh, all I can think of are some less-than-speakable but valuable directions.