Imagine a stable universal currency (let’s call it R$):

📍: R$ is stable because if you hold your savings in R$, you never have to worry about the prices of goods and services rising over time and the value of your money being inflated away, no matter where you live.

📍: R$ is universal because whenever you want to buy something, your R$ will automatically convert into your local currency to be spent.

Nevin Freeman: I first heard about cryptocurrency in 2011 or so in the Less Strong Community, a group of people excited about human rationality. They have a geeky blog I was reading at the time, which is where I heard about it.

Back then, I had some exciting conversations pondering whether Bitcoin could become the world's primary currency and concluded pretty quickly that it wouldn’t be able to do that.

So basically, at that time, I moved on from thinking about cryptocurrency. I figured, like, okay, well, maybe something here will work, but it seems like this particular experiment wouldn’t lead to a currency for the world.

Nevin Freeman: I started thinking with some friends about, well, could you create an alternate world reserve currency that was not dependent on governments that would stay stable over the long term?

Can we compete with other stablecoins that are being used for crypto speculation? Or is there something we could do early on in the project to gain momentum that would be better for some reason?

And so we quickly started thinking about what if we offered stablecoins in places with currency issues, exceptionally high inflation, and or capital controls.

And it started as just like an intellectual thought of like, well, let’s look at the numbers, which countries have this problem.

I was interested in making money to create a long-term stable currency for the world.

I was also interested in the practice, like getting experience running a large, complicated project that deals with politics and government, and so on, because that’s relevant to my other interest.

Nevin Freeman: I think people want to tell a nice convenient origin story, and it’s like, I think we did have genuine good motives for the world at the beginning. But yeah, the focus on Venezuela was it wasn’t because we were from there.

Gabo, who is now in charge of RPAY, the CEO of RAPY, joined the project early.

Before we even met, he had been trying to solve Venezuela’s monetary problems with crypto for a couple of years. So in a way, the RPAY project, if you see it as Gabo’s passion project, that origin story is more like that.

It’s just that I started this particular project under this label. Gabo’s prior effort failed, and he continued trying under the reserve banner.

Nevin Freeman: What would I say to the crypto market? I’m sorry.

I often end up in the position of apologizing because people come and buy RSR with the expectation that we will behave like many other crypto projects and do things to attempt to hype the coin. And then they often end up very upset when we don’t if the coin doesn’t go up. And so I end up in the position of apologizing. That’s not the answer you’re looking for, but that is the answer to what I do.

The more interesting answer is if we imagine zooming out another ten or 20 years into the future, and we think about the trajectory of the phenomenon of smart contracts going to look like over that time frame.

It would be heartbreaking if 20 years from now. It’s just like it is today in terms of primarily being used for speculation on top of speculation.

We want to build financial infrastructure that is lasting and valuable to a large swath of the world. And so it does mean that we don’t necessarily take the ride on the hype train in the same way. But if it works, then it will be part of something that we think is, in a way, much more exciting and hopefully a lot less cringe.

Nevin Freeman: Yeah, that’s a good question. Crypto is so fascinating, or even just defying Ethereum is so fascinating, because every new thing that’s built is something you could potentially integrate into your application or another application, right?

It’s not the same as the Internet, where you had many different websites popping up during the Internet boom, but they were all just these separate things. We built the protocol to accommodate those and allow for flexibility, where now anyone can build a new collateral plugin for any new type of asset in DeFi.

So that as DeFi continues to evolve, our tokens themselves, even ones that have already been deployed through governance actions, can continue to grow and interact with an ongoing, ever-changing set of DeFi infrastructure.

So on a technical level, our current answer is modularity and openness, where anyone can write those new contracts. It doesn’t have to be us. Hopefully, that will mean that our tokens continue to evolve at the same pace as the rest of DeFi.

Nevin Freeman: I have to make one caveat: I am not here to try to compete with or destroy or replace fiat money in as much as fiat money is functional.

If the US dollar were to stay stable and not have massive issues and never have any capital controls and so on, I am content with the world where the US dollar is dominant, and I’m not here to try to compete with it just to make a buck.

So the way I see it is that with the protocol and with asset-backed currencies, we see them as like an alternate option in the case that the current system implodes, where I hope that it doesn’t, but if it does, then here’s this option that we’ve conceived of.

The end goal here is to have an alternate world reserve currency as the main one if fiat currencies have issues that maintain their purchasing power by indexing the entire world economy.

Nevin Freeman: Well, I hope that myself and the reserve project, if they end up successful, I hope that it will send a message that it is possible to think very carefully about how things work or could work, how things could happen, could play out, and to plan very carefully and very far in advance to create something that makes sense.

Rather than kind, often, the cliche startup modality is just starting something and then iterating. You’ll eventually figure out something that turns into a business and makes you some money. Obviously, the thing we have done is much more patient and contemplative and intentional and in a way that’s often very annoying because of how slow it is. And it annoys us internally as well.

We don’t want to go slow, but it’s maybe necessary for avoiding all sorts of pitfalls, and we’ve seen many different stablecoin projects try their thing and then fail in one way or another since five years ago when this all got started. And so, in some small way, I feel a little bit vindicated that it was worthwhile for us to think things through and not just randomly do shit.

But yeah, if it works on a massive scale, I hope that we send a message and that people remember us as proof that planning and careful thought can work and can be valuable and shouldn’t be passed over.

Nevin Freeman Twitter: https://twitter.com/nnevvinn

Reserve Website: https://reserve.org/

Leave Nevin An Anonymous Message: http://admonymous.co/nevin