Interview with Sunil Aggarwal – Author of Bitcoin Magnet and Founder of Trustmachines

Interview with Sunil Aggarwal – Author of Bitcoin Magnet and Founder of Trustmachines

bitcoin Interviews
September 5, 2017 by Gopal Bansal


Thanks for your time Sunil. Let’s start the conversation.

(1) When you’re introduced to Bitcoin and Blockchain technology and how you went with the flow of knowing this technology?

I ventured into Bitcoin in early 2012. My major motivation to get into this field was to know that what is the ideal definition of money? When I say the ideal definition of money we should understand money in the context of globalization. When we discuss the money of last 5000 years, I could see no peer to peer has introduced to us and Bitcoin has this uniqueness and this money is on a global level. When I understood this definition of Bitcoin, then I started to explore more about this technology.

(2) Please tell us about any three use cases like:

  • How is blockchain technology good for banks?

The first thing is that Blockchain technology is good for many things. A book by Tim Swanson has mentioned around 84 use cases of blockchain but out of 84 use cases if we take only 3 and starts with banks then I can say that the blockchain technology is a very fundamental technology which is helpful for banks. The thing is will banks use blockchain technology within their current structure or will they actually innovate new blockchain technology. For example, Banks are very poor in providing real time global transactions so if banks want to provide instant transactions then they must use blockchain technology and in that scenario Ripple technology is a very good example. If banks use Ripple platform, they can provide instant and nearly zero cost transactions in less than 10 seconds. Remittances are the first major use case for banks and if banks are really interested in building smart contracts then trade finance is something which can actually be another major use case for banks. In a couple of years, these two major use cases will be implemented by banks of this world from India as well as outside India. I feel that remittances and trade finance are the two major use cases of banks while implementing blockchain solutions.

  • How will blockchain technology helpful to stabilize real estate?

In real estate, the major problem is that all the land deals are actually paper based and all the transactions are handled manually. When we talk about the registry keeping of all the land record offices, the situation is very bad. If these things shift on the blockchain, the flow of keeping records will get very smooth and quite easy. The second thing is that we can ensure very quick transactions within the system. This is not the only thing we can do in real estate with blockchain. If we want to shift our rental system, even that is possible. There are some good developments on white paper and innovations are going on for these things but whenever they’ll be done, these markets can be put on the blockchain very easily. The company name is doing that part. I would say that there is hardly any business area in which blockchain technology cannot be used.


  • How will blockchain technology help to file digital identities?

The problem of the current world is that when we are actually entering into a Facebook based login system or a Google’s Gmail based login system, then there is a very serious problem in that how to prove this person is actually a Sunil Aggarwal. If I fill a particular mobile number then that becomes my identity. How the system will ensure that this person is Sunil Aggarwal. It means the identity is confirmed by matching multiple records. My Aadhar should be matched, my PAN (Permanent Account Number) should be matched, my Facebook identity should be matched and there are a lot of things which should be taken care of but in this context, the fundamental problem is that who should console that data which is actually your digital identity. For example, today Facebook owns your digital data, Gmail owns your data and Facebook and Gmail are basically separate boxes and those boxes are not talking to each other. So, if two boxes are not talking to each other than how a seamless and inter operable system of identity can be established. So, the best way is to have a self-sovereign identity is you should have your identity recorded on a blockchain based system and from that system you can allow Facebook and Gmail to have the authentication rights of your identity. And not to Facebook and Gmail, you can provide any kind of player authentication rights so that they can use the data of your identity at one place like your residence proof, income tax proof, PAN card, Aadhar card, registered property, bank account and all those things. All the data should be in an individual’s control and he or she should be able to provide some source of access to all the players. So, the problem is how to put this digital identity on blockchain. Either Government should do it or some international body should do it. If they don’t do it, the issue they’ll face is all multiple players will start doing this so there will be multiple boxes or multiple chains having your digital identity. So, I would say that in this world a digital identity can be put on blockchain but those change should be from the government level.

(3) What is the scope of these ERC20 tokens and how this will change our traditional start-ups?

ERC20 tokens standard is actually a very disruptive thing in the world of venture capital. In a traditional start-up, what use to happen that if somebody has an idea or a product to offer then the person would go to a venture capital for funding so the method of raising funding was either by diluting equity or incurring debt. So, the person who was a capital provider is in a dominant position. Now what ERC20 tokens standard which we can also call an ICO mechanism is done that the person doesn’t need to go to a venture capital, he or she just need to write a whitepaper and launch a website and ask for people to fund it. Let’s discuss two disruptions:

Disruption 1: It’s a global crowd funding mechanism which is done not by banks, which is done not within borders rather it is done outside banks and borders by cryptocurrency. You have a mechanism where anybody from any part of the world can fund you either in a small amount or in a big amount.

Disruption 2: Whenever one person or a group or an entity invest in a start-up what happens that till that start-up starts producing profits the money remains locked. The equity cannot be diluted but in an ICO or ERC20 tokens based system, the token can be liquid anytime, anywhere. So even if somebody wants to make an exit after some time then that person can sell that person in an open market operation.

So, it means this is a double disruption first you don’t need a venture capital and second is you don’t need to lock your money into a certain thing so liquidity, as well as crowd funding on a global level, is never seen in this world before. So, this is the very big disruption and Ethereum enables ERC20 tokens a standard in such a way that anybody who has basic coding understanding can do it and once metropolis hardfork are done, the things would reach a certain stage where any common man can issue ERC20 tokens. So, this is something which is actually revolutionizing the method of funding where the providers of capital are actually no more on the driving seat. So, anybody who has an imagination, who has a product can start a company and he or she don’t need to go to any particular Ministry of Corporate Affairs to register a company. You can start a network by simply issuing a token.

(4) Where will Bitcoin stand after two years on the basis of central acceptance and price levels?

There is no clear cut authenticated mechanism to judge the price of Bitcoin. Bitcoin can be $1000, $2000 or even can be $10,000 or even more than that. To understand the real price of Bitcoin, we need to understand the politics of money. Now global money is actually divided into multiple fiat currencies so all of those currencies are basically big boxes of value. They reach to boxes of value once but now they are boxes of debt. In this context, Bitcoin is emerging as a central bank of Internet which don’t follow any logic of border or a bank. Now people are regarding Bitcoin as a money of people, fiat money is a legal tender, Bitcoin is a people’s tender and Bitcoin is rising not because Bitcoin is good, but Bitcoin is rising because fiat currencies are bad. At the end of the day, people want to trust a currency and if fiat currencies cannot provide their trust mechanism then some another alternative has to provide that thing. Bitcoin is providing that trust so where there is trust, growth will be there. In terms of growth, Bitcoin can reach $10,000, $50,000 in just two years. Why I am saying so because if any major economic collapse or a banking crisis or monetary crisis happens in coming two years, people will shift themselves from fiat currencies to cryptocurrencies and out of that shift my expectation is 50% of that shift would happen in Bitcoin. If Bitcoin has risen from $1000 to $4500 in last eight months it can rise ten times in next two to three years. This is not related to anything within Bitcoin but this related to anything outside Bitcoin.

When I say central acceptance, what do I actually mean by it? There are two ways:

One way is that central banks or commercial banks start accepting Bitcoins as a legal payment method.

The other way is central banks start using Bitcoin’s blockchain to use their clearing and settlement operations. As far as Bitcoin’s legal payment method is concerned I personally feel that the regulation is turning more and more positive because central banks have not been able to design any reliable method to control Bitcoin so the option is accepted. The problem arises in this scenario how to accept and when to accept and my personal understanding is that Bitcoin will finally be accepted by central banks either as a payment method or as a method where it can be used as an authenticate ledger for clearing and settlement operations. There is one more argument that central banks may go for a Bitcoin like a cryptocurrency which is called CBIG (Central Bank Issued Global Currency). If that happens, things would be very interesting because then it would straight away mean that banks are actually trying to outscore Bitcoin so it means if Bitcoin offers transparent blockchain then central banks have to offer the same. If Bitcoin offers a permission-less blockchain then central banks might have to offer the same. That fight would be very interesting and I want to quote here a Balaji Srinivasan’s line:

Third world war will never happen between nations rather it’ll happen between land and cloud.

In a couple of years, if all major platforms like WhatsApp, Facebook, Skype or Netflix will start inserting Bitcoin wallet in their system then things might take a unique term. Bitcoin valuation and Bitcoin transactions might reach a few hundred thousand per day to million transactions per day.

(5) Tell us something about Trustmachines and what are you offering with Trustmachines? And what would be the targets you want to achieve with Trustmachines?

For the last six years in a blockchain ecosystem what I have felt is that learning is the most serious problem in this space because no university, no academic journal or no dedicated research tank has actually led the innovation space in blockchain space. That’s why I personally feel that time is very right for initiating a blockchain education system. Trustmachines is actually a blockchain education company and our long-term target is to launch India’s first MBA in blockchain business management. We want to reach that target through certain steps that we are launching two certificate programs one certificate program is Crypto Wallet Manager Program where we’ll be teaching how to handle a crypto wallet both for Bitcoins and as well as altcoins.

The second certificate program is Blockchain Asset Management. There are at present around three hundred cryptocurrencies which are worth investing but for a normal person or for even a good investors mindset, it is very difficult to enter a particular currency. How to build a portfolio, how to manage a portfolio of such a large number of cryptocurrencies is a very difficult thing. We have designed a course blockchain asset management just to handle that particular demand in the market and the third thing is Certified Blockchain Management where we’ll teach developers on Ethereum and multichain blockchain space so that after around three months of training they can be industry ready. Along with that, we have also designed credit long courses and semester long courses for multiple academic institutions like Business schools and engineering colleges where blockchain can be introduced in a small way. So that’s the thing we are actually trying to do with Trustmachines.

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