Welcome to the latest episode of the Casper Blockchain Podcast, where we engage in an insightful conversation with Ralf Kubli, Board member of the Casper Association, a distinguished expert in the field of blockchain technology. Join us as we delve into the profound concept of trust and explore the transformative potential of blockchain in mitigating its associated costs.
In this captivating episode, hosts Joe Benso and Matt Shaffnit engage in a stimulating dialogue with Ralf Kubli, delving deep into the intricate relationship between trust and blockchain. Ralf's extensive knowledge and expertise shed light on the profound implications of decentralized technology in redefining trust mechanisms across industries.
Discover the inherent costs associated with traditional trust models and the inefficiencies they impose on various sectors. Explore how blockchain, as a decentralized and transparent ledger, has the potential to revolutionize trust by reducing reliance on intermediaries and enhancing security and accountability.
Ralf Kubli shares valuable insights into the practical applications of blockchain use cases - in areas such as supply chain management, finance, and governance. From streamlining complex processes to ensuring data integrity and traceability, blockchain technology offers a paradigm shift that can reshape entire ecosystems.
Join us as we explore the significance of blockchain innovation, fostering collaboration, and enabling new business models. Ralf Kubli's astute observations on the potential pitfalls and challenges of implementing blockchain solutions provide a well-rounded perspective on the technology's journey toward mainstream blockchain adoption.
Continuing our conversation with Ralf Kubli, we delve deeper into the critical aspect of blockchain trust, an element that forms the very foundation of decentralized networks. In the digital age, trust is paramount, especially when it comes to sensitive data and transactions. Blockchain, with its immutable ledger and cryptographic security, not only addresses existing challenges but also pioneers a new era of trust in the digital landscape. Ralf elucidates how blockchain's consensus algorithms and cryptographic techniques ensure data integrity, making it virtually tamper-proof. By decentralizing trust, blockchain technology eliminates the vulnerabilities associated with centralized systems, fostering a more secure and trustworthy environment for individuals and businesses alike.
Furthermore, our discussion touches upon the evolving landscape of blockchain trust, exploring emerging concepts such as self-sovereign identity and verifiable credentials. These innovations empower individuals with control over their digital identities, enhancing privacy and security in an increasingly interconnected world. Ralf Kubli's insights shed light on the ongoing developments in blockchain trust mechanisms, illustrating the technology's potential to usher in a future where trust is not just a concept but a tangible, verifiable reality. Join us as we unravel the layers of blockchain trust, envisioning a world where secure, transparent, and decentralized systems redefine the way we perceive and establish trust in the digital age.
Whether you are a blockchain enthusiast, a curious observer, or an industry professional seeking to understand the transformative power of trustless systems, this episode is a must-listen. Tune in to gain a deeper understanding of the cost of trust and the profound significance of blockchain technology in reshaping trust models across industries. Prepare to be inspired and enlightened by this engaging discussion with Ralf Kubli.
[00:00:00] Joe Benso: Welcome once again to the Casper Podcast, where we take a deep dive into blockchain technology and speak with those who are building the future of the decentralized web. I'm your host, Joe Benso, and as usual, I'm joined by my colleague, Matt Schaffnit from the Casper Association. Thanks again for joining me today, Matt.
[00:00:21] Matt Schaffnit: Absolutely!
[00:00:22] Joe Benso: We're joined by Ralf Kubli. Ralf is a board member at the Casper Association and a modern thought leader on blockchain and finance. So Ralf, thanks so much for joining us on this podcast. If you can give us a quick intro on how you got started in the blockchain and the Casper Association.
[00:00:41] Ralf Kubli: Yeah. Thanks for having me. It's awesome to be here. So, I got into blockchain because of Web1, I would say, the internet just became touchable with the research infrastructure that I was using as a student, we were actually browsing texts, so there was no graphic interface. Then when the graphical user interface came up, I started coding HTML. From 94 to 96, I was coding web pages, and it was a fun time.
[00:01:15] Ralf Kubli: Then for some odd reason, I stopped and then I finished my studies and I joined large corporations, but then I got distracted as you know, life does. It was very busy. I worked a lot and then in 2015-16, I came across Ethereum and I came back into the space. I lived in the US and in New York, there was a really interesting scene, and I witnessed first-hand debates between Bitcoin maximalists and Ethereum guys.
[00:01:44] Ralf Kubli: So, this was an interesting time, and the reason why I really got attracted to blockchain then was when I studied, I spent a lot of time on trust, and I spent a lot of time on trust in societies and economic systems. That's why I was really attracted because this was now foundationally different than anything else. This new technology. Why is this so exciting? Because in many societies, the cost of trust is really high. This means that you spend an inordinate amount of time, money, and effort to produce trust in order to enter into an economic activity. Now, when you think about Switzerland, or the US, or Germany, Canada, in general, you can trust in both institutions and in your counterparties; that people actually obey contracts that they enter, et cetera. That's okay. Very large portions of the world's population do not live in these countries. They live in countries where it's very difficult to do business.
[00:02:51] Joe Benso: So, Bitcoin or blockchain, in general, has been described as the “trust machine”. So it's very relevant. What you're saying has also been said that we are at a point right now in the development of blockchain and the potential of blockchain. That is just as significant if we were back in 1995 and someone said, there's this thing called the internet and it's going to disrupt and change society as we know it. Would you agree with that? Where would you say that we're at in terms of blockchain development and its impact on society? Is it as important as the internet has been? And maybe specifically around smart contracts and NFTs, does it carry that same weight and significance at this moment?
[00:03:31] Ralf Kubli: I think it does. Yeah, you can say, we're at 1995, which is maybe true, you know, or maybe we're at 1999. I don't know. It's difficult to judge, in comparison to the Web2 development. But what we can probably say for certain is that it takes a lot of time and it's unknown what the trigger is for these technologies to be widely adopted.
[00:03:52] Joe Benso: Matt, what are you thinking about this?
[00:03:54] Matt Schaffnit: One thing that excites me about blockchain technology is the potentiality of it to swing the pendulum back where we're focusing on the consumer and end user. Could we go back to this and talk about your experiences with that within the realm of how tech and the markets have evolved over your career? Because it's kind of been very broad.
[00:04:16] Ralf Kubli: The reason why I'm so excited about solving some of the stickiest problems in finance with blockchain is because of what I've laid out before, this reduction of trust. It's relevant in several ways. First, we put a lot of trust in central institutions everywhere, but in finance specifically, because it's critical that we can pay our bills and that we can save money and make investments.
[00:04:40] So we just assume that they work and they do it right. And we trust certain brands and managers and so on. This is a problem as we see again and again and then it causes big disruptions. I'm not just talking about fraud, I'm talking about the inability of certain organizations to calculate interest rates correctly, for example.
So, because blockchain and smart contracts offer observability, verifiability, and enforceability, this offers a lot of opportunities in finance to make the financial system even more trustworthy. When you have more trust, the cost of borrowing, for example, will be reduced because we have more trust in what's going on.
[00:05:20] Joe Benso: So Ralf, where do you feel Casper fits into this evolution of the future of finance? And what is it about Casper that encourages you to continue to work on these hard problems?
[00:05:34] Ralf Kubli: So, recently a developer asked me what makes Casper different. Casper is uncompromisingly permissionless. While other chains and other infrastructures require you to access the chain through certain infrastructure that is provided by fairly centralized players, you have to use some of their infrastructure.
[00:05:58] Ralf Kubli: That is not the case with Casper. It's very inexpensive to run nodes and it's still relatively inexpensive to run a validator. The other aspect is that this technology has been built by technologists who have spent a lot of time on pretty significant projects in the Web2 space. We want to provide an infrastructure that is well regarded by developers who want to have a platform where they can see that there has been thought going into this, that there's structure, and that it basically takes into consideration some of the developments and some of the insights in software development over the last 20 years.
[00:06:38] Matt Schaffnit: I was wondering if you think the amalgamation of the many antiquated tech stacks in the money center banking system that have accumulated over the last 75 to a hundred years in the mass consolidation of the system will at some point reach a flexion point at which the cost-benefit of deferring your switch over to a new tech stack, right? Will that reach an inflection point you think because you've been on the side of many of these financial institutions that we're getting closer to that?
[00:07:08] Ralf Kubli: That's an interesting point. Many of these systems reached their end of life, and quite frankly, the industry has thought since 2017 that tokenization is a great way out of this mess, but it's not without proper consideration of what is represented by a token. This is the problem of blockchain and finance currently that many actors do not consider carefully enough what the token is representing, and this is going to be an issue if it's not defined as a financial contract.
[00:07:42] Joe Benso: I want to ask you about a project called Nucleus Finance that's building on Casper. Can you tell us a little bit about the business model and how they're using Casper to bring innovation to the world of finance?
[00:07:54] Ralf Kubli: Nucleus Finance is a joint venture between two firms. One is Casper Labs and the other one is a company called Ariadne. But at the heart of what Nucleus Finance wants to do is to bring this transparency to finance and solve the notion of verifying what kind of financial agreement, what kind of financial contract has been entered into. Nucleus Finance has proven now in several proof of concepts and now also with live customers that it can produce basically near real-time balance sheets.
[00:08:31] Joe Benso: So Ralf, in a nutshell, Casper has a vision, but give it a 30,000-foot overview of the vision of Casper as we're going forward solving these problems or attempting to solve these problems and having a huge impact on the future of blockchain, the future of society, really, what are the most critical topics for you, for Casper?
[00:08:52] Ralf Kubli: We think along the lines of topics that we believe are relevant and are here to stay. So, one is tokenization. We believe that everything will be tokenized. That obviously is true for financial assets, but it's also true for other assets, real assets that will be represented on chain. We believe that that's an important topic. So, we want to work and provide infrastructure for tokenization of any asset.
Then, out of that comes the creator economy, which is the ability of individuals or groups of individuals that monetize the work, the intellectual capabilities, the design capabilities, and the musicians.
Then we mentioned algorithmic standards. We believe that algorithmic financial standards are key to revolutionizing and changing finance and are a precondition for DeFi to be successful over time.
Then, of course, related to the creator economy is how this ownership of these assets, so there could be patents, copyrights, and of course, legal ownership, how this will change on the basis of these new technological capabilities.
Those are the four areas that we think are big topics. We would like to provide solutions to solve some of these sticky key problems or build new business models on top of Casper.
[00:10:13] Joe Benso: Amazing. I really appreciate the insights and your time today, Ralf, and looking forward to keeping things going.
[00:10:22] Joe Benso: This is a bit larger conversation than we have time for today, so I think we're going to leave it there and pick it up on the next episode. If you are enjoying these conversations on the Casper Podcast, be sure to subscribe. You can also leave us a voice message for a chance to appear on a future episode. We always love to hear from the listeners. So until next time, keep building and we will see you on the next episode of the Casper Podcast!
