Kevin Owocki 00:00
Hey what's up coordination, on the pod today we have Jasper in harm of Glo dollar. So Jasper is the Chief Marketing Officer at Glo and Garm is the CTO at Glo working on the technology. And Gllo dollar is a stablecoin that embeds philanthropy in side of the Glo dollar. So basically, the way it works is that it's kind of like USDC. And except we you know, except where USDC creates revenue for circle by you holding USTC by the way of of interest in the actual money in their bank account. Glo dollar takes that interest and it gives it to give directly in order to reduce extreme poverty. So the meme that we talked about on this episode is zero XP zero extreme poverty. As the Glo dollar market cap goes up, then extreme poverty goes down is basically the pitch behind Glo dollar. So it's launching in q1 of 2023. So in the next couple of weeks, I'm told is, is TBD when it's when it's going to launch. And one of the things that I'm just really excited about with glow dollar is this idea that we can embed philanthropy into the base layer of our economy, if you exchange with glow dollar, if you are holding glow dollar, then you are then you're basically helping to reduce extreme poverty, which is I think it's quite elegant that people don't have to think about their donations, and they can just embed philanthropy in what they do. So risks and disclaimers all defy and smart contracts are risky. I do not advocate that you hold good or do your own research on glow dollar before before you hold it. Glow is also a greenfield sponsor in q1 of 2023 and we really appreciate them supporting the regenerative crypto economics move movement and um you know, I'm just pretty excited about what they're up to embedded philanthropy seems really great. Zero extreme poverty seems really great. And just the simplicity and the elegance of if a if a DAO or someone that uses defy holds globe dollar instead of USDC or tether, then they can reduce extreme poverty just seems it just seems like a pretty well designed system to me. So I'm curious what you think coordination without further ado, I give you a Glo dollar. enjoy.
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Kevin Owocki 04:21
Alrighty what's up gentlemen, how are you?
Jasper Driessens 04:24
Good. How are you?
Kevin Owocki 04:26
Pretty good. Really excited to talk about Glo dollar. So can we hear abou the why what and the how of Glo dollar?
Jasper Driessens 04:34
Yeah, definitely. So we're Garm and Jasper from the Glo foundation. We're building the Glo dollar. And I think for the crypto audience, the most basic way to put it is that we're a fully backed, stablecoin just like any other stablecoin. But we're a nonprofit. And all of the money we generate, we donate it and Then we lift people out of extreme poverty by giving them basic incomes. And because of that, when you hold the Glo dollar, it's just like holding any other stable coin. But because of you, you're lifting people out of extreme poverty doing so.
Kevin Owocki 05:21
That's great. I mean, what I love about Glo dollar is that it's such a simple mechanism for like a DAO Treasury or someone who's involved in crypto to hold Glo dollar without it seems like without any additional risk, I haven't I haven't audited your smart contracts or anything like that. But it seems like a DAO could move from USDC or DAI into Glo dollar and then just create positive externalities by holding Glo dollar. Is it really that simple? And also, what would you say to people out there who maybe hold stablecoins, and are considering moving them to Glo dollars?
Jasper Driessens 05:54
Yeah. Ideally, it is really that simple. In the beginning, there will be a Delta, right? So I think when you compare stablecoins, there are a couple things you want to compare them on. One is utility, like where, what platforms, is it supported by on what exchanges it listed, two is liquidity, and three is trustworthiness. And once we launch, we're not in our ideal state on these things. But you know, as we work over time, we will get to a point where it literally is as simple as that. And we actually want to go a bit beyond that. So if you're using stablecoins right now, then there will be a point where moving to Glo dollar is truly something that comes at no opportunity cost to you. But ideally, we can at some point, say the same thing about holding US dollars. So it's not just if you're a crypto person, it's also if you're just a normal person receiving a salary doing payments, we want to move towards a situation where you can do that in US dollars or in the Glo Dollar. And if you do it in the Glo dollar, you're lifting people out of extreme poverty.
Kevin Owocki 07:22
And, you know, Garm this might be a question for you. But you know, in building that network effective Glo dollar, I'm assuming it's in ERC. 20. So basically, anyone who integrates with any type of token can integrate with with Glo dollar. Is that true? And also, do you want to tell us a little bit about the technical architecture? I know you're CTO over at Glo dollar?
Garm Lucassen 07:45
Yeah, absolutely. So it is indeed an ERC. 20. It works, basically the same as all other stablecoins. There's one sort of twist though, that is that transferring US dollars using Glo is 10% Cheaper versus the other stablecoins that are out there. That's because we essentially implemented an optimization on the smart contract level that allows us to check for denylist, or "blacklist" as they are controversially called, entries in a more efficient way than the large stablecoins that are out there do it. And that's yeah, between 10 to 15% cheaper than the alternatives. It's based on a proposal by Alex Kroeger, who initially did this as a pull request for the Centre tokens, which power USDC. They've never really bothered to implement it, I think for legal and regulatory and internal compliance hurdles or reasons. But we have connected with him and indicated hey, we'd like to do this. He was supportive. And so we did. And to put that into perspective, I think it was in June 2022. If USDC would have implemented this optimization, that would have cost the entire ecosystem of USDC users about 700k less gas in one month. So at scale these these sort of small optimizations are really important for the user, however, it definitely just functions as an ERC 20. And then, if you want I can also go even deeper into our vision beyond sort of crypto, which is more around okay, how do we actually attract people outside of crypto to also adopt the glow dollar?
Kevin Owocki 09:51
Yeah, so I mean, I think that for me from from doing my research on you all, it feels like there's this meme that's in your marketing, which is that as the Glo dollar market cap goes up, the number of people in extreme poverty goes down. Like it's literally just reverse correlation between how successful Glo dollar is and the number of people that can be taken out of extreme poverty. And I'm assuming that like, crypto is the starting point. But then when you said even going outside of crypto, is that like your second act? How much could you reduce extreme poverty just by getting market penetration in crypto versus, you know, having to go outside of crypto and into the legacy system?
Jasper Driessens 10:31
Yeah, good question. So when our market cap goes up by $18,000, so one eight, on average, will be able to lift one person out of extreme poverty. So basically, anything that grows our market cap divided by 18k, and that's how many people lifts on this out of poverty. So when you compare this to for instance, Tether has a pretty brilliant business model. So they're fully backed, which means they keep you know, 100% of their market cap value in a reserve, and they invest that reserve in all sorts of assets, very low risk assets. And on average, we estimate that they make 2.7% of whatever their market cap is. So if if Tether would do would we are going to do they would be generating $1.8 billion per year, and that would lift 3.7 million people out of poverty. So that's Tether. Tether now has a market cap of I think $66 billion -- the total s tablecoin market, it depends a little bit but over the last half year or so it has been $150 billion -- if we would, you know, theoretically capture a the whole stablecoin market, we would, on average, be lifting eight and a half million people out of extreme poverty. The numbers there are I think, pretty, pretty, pretty nice. Even though of course, 8.5 million people is like nowhere near lifting everyone out of extreme poverty, which which is our goal, but I would still be proud of that, of that impact.
Kevin Owocki 11:20
What is the number there of number of people who are in extreme poverty across the world?
Jasper Driessens 12:23
It's about 650 million.
Kevin Owocki 12:26
Wow. makes me so sad. Okay, so doing some quick math 650 million times 18,000. In Glo market cap. So if you got up to a market cap of two, three, it looks like like 11 trillion, then you could remove everyone out of extreme poverty. Uh, hopefully, hopefully, my math is correct on that 18,000 per person in market cap, times 650 million to me equals 11 point 7 trillion in market cap, you would have to get to two reach 0XP, which is, which is the meme that I see on your website, zero people in extreme poverty.
Jasper Driessens 13:10
My notes say about the same number. So that's right. We're doing the math. Yeah, pretty impressive. Like I'm definitely using a pre-created Excel sheet for this. But yeah, 11.2 point, something trillion, and that would amount to a little over 8% of all the fiat money in the world. So if we get 8% of all money holders, you know, wait, it's equally to do this, then theoretically, we could provide everyone in extreme poverty with with a basic income. Now, you know, it's a little bit of an oversimplification, because some of these live for instance, in North Korea can't really get there with basic incomes. So that's an oversimplification right. But yeah, when I left direction, yeah.
Kevin Owocki 14:12
So one of the questions I always ask guests is in a world in which you're maximally successful, what is the world look like? And it feels like we've kind of reverse engineer that right here. You're You're the meme is 0XP zero people in extreme poverty or as close to it as possible. Is that right?
Jasper Driessens 14:31
Yeah, that's that's that's absolutely right. And you know, in terms of what we do, our our goal would be to get to a point where yeah, like I said, like using the Glo dollar is equivalent to using the US dollar. When it comes to security when it comes to utility, such that, it really is a no brainer for people to switch. And, you know, if we get there then enough people should be willing to do it to actually get to these numbers, I think. Yeah.
Kevin Owocki 15:07
What is the reserve model? so I know a rudimentary amount about stablecoins but as far as I understand T ether is fully backed in a bank account, and they provide some amount of information to auditors so that people can be sure that it's fully backed, but there's always people who are kind of guessing whether or not tether is fully backed. And there's like conspiracy theories about it. I know with dye, it's a decentralized, collateralized stable coin. And then you've got various other models for stablecoins. So like, is Glo dollar 1:1 more with Tether, but with embedded philanthropy, USDC but embedded philanthropy DAI, but embedded philanthropy? Or is it like a different model completely?
Jasper Driessens 15:53
The closest model would be USDC, Circle.
Kevin Owocki 15:57
Jasper Driessens 15:58
That is generally what we look to, as a reasonably good example of how to do it in terms of transparency in terms of reserve management, we want to go a bit beyond that, ideally, have real time, insight in our reserves, or in daily, have a big four audit, tie our hands to the mast when it comes to what we can and can't do with the reserve. So we really want to do everything we can to make this reserve strategy as trustworthy as possible. But I think the way USDC is doing it is a very good first model.
Kevin Owocki 16:47
Got it. So as I understand it end to end, people put money into Glo dollar. And then there's a certain amount of actual US dollars that are stored in a bank account somewhere that generates interest. And in like the USDC model, a lot of that interest goes to -- that revenue goes into overhead and just the profits of circle. But in the Glo model, it goes mostly, if not all into relieving extreme poverty. So you get $450 per year in dividends or interest per $18,000 in global reserve. And that's what funds the removal of people in extreme poverty is that sort of like end to end? how the system
Jasper Driessens 17:32
works? Yeah, that's right. If you want to get really specific, we, like Circle does, will invest a part of the reserve in US short term Treasury Bills. And we will keep a part in cash, the cash will not give us yields, but it's necessary to have a liquid enough reserve liquid and people want to redeem So circle right now is holding approximately 80% in T bills, 20% cash, you know, we expect to get to similar levels. And then these deals, so the 80%, historically, they have a yield of 3.4%. So 80% times 3.4%, you get to 2.7%. So 2.7% of whatever our market cap is, on average 100% of that we donate and then we donate that to an NGO called GiveDirectly. They also have a little overhead so they have an overhead of about 10%. So, you know, you multiply a lot of factors, but when you multiply it all together, you get to an average number that every $18,000 of of market cap provides one person in extreme poverty with a basic income. So you know, what does that mean in practice? Well, you can -- it depends on on whawhere right when it comes from but I think DAOs are a very interesting use case. So I looked up the Treasury holdings of the Gitcoin DAO, for instance, they currently hold a little over 8 million in stablecoins in terms of Glo that would lift 466 people out of extreme poverty. So it's a pretty cool, sort of like, additional impact that any DAO that holds stables can just have with, you know, one click of a button or in case of a DAO like one vote. And that impact is essentially for free. You're already using stablecoins so you're already accepting the risk of holding a stablecoin. So in that particular case, it's it's truly, truly a no brainer, I think,
Garm Lucassen 20:08
Maybe one small addition here, as one thing we haven't discussed yet is the overhead, right? And the people that are building this, they also need to live. But we feel strongly that we should not be incentivized to, to grow Glo dollar to benefit ourselves. So 100% of all the revenue we make, through investing in Treasury Bills goes to GiveDirectly in its entirety. The Glo Development Foundation, the organization behind the Glo dollar is entirely funded by donations by individuals.
Kevin Owocki 20:52
tell me about the meme of embedded philanthropy, I think it's really quite interesting to think about embedding philanthropy into our everyday economic activities. What does embedded philanthropy mean to you? And why is it a win for reducing extreme poverty?
Jasper Driessens 21:09
Yeah, okay. So the pitch is something like this. If we want to give everyone an extreme poverty of basic income, the limiting factor is how much cash there is to give away. So like, by definition, so we need a whole lot of money to just scale up that idea of, of basic incomes. And right now, these basic income programs are often funded either from private donations, or from government philanthropic aid. And that is placing a fundamental limit on the scalability of these programs, because, you know, there's only so much money that people and states are willing to give away. So the total addressable markets cap, sorry, total addressable market for for anything that's based on donations, it's just very small. And that actually makes a lot of sense. So let's say you're the average US household, then you have a savings account that contains about 40k. dollars, you spend about 60k. So, as an average US household, you you control, where $100,000 go every year in the economy. And on average, you donate only 2% of that. And only 0.2% of that ever goes across the US border. So if you are a donation-based charity, your total addressable markets is 0.2%, like a very tiny slice of the pie chart of the money in the economy. So if we want to take this, this idea of giving people in extreme poverty, basic income, if we want to take that seriously, and we want to scale that up seriously, we need a way to fund it that does not depend on donations. That sounds like it's impossible, because how can you contribute financially to a charitable cause without donating. But there are actually some instances of how that can be done a different way. So I think the most famous one is what Patagonia did. The owner of Patagonia, the founder of Patagonia donated the whole company to a charity a couple months ago. And because of that, you as an individual, you now have two ways to contribute to the charity, you can actually donate to the charity directly, or you can wear Patagonia clothing, and then the profit margin of that purchase goes to the charity. So wearing these clothes, buying these clothes is sort of like an act of charity. So in doing so Patagonia embedded philanthropy in the garments that they create and sell. And that trick could be applied to any product. So you could have a philanthropcally embedded toilet paper, if it's manufactured by a toilet paper manufacturer that donates 100% away. Now, we're taking that to the extreme, and we're saying, Well, let's not embed philanthropy in any particular product, but let's just embed it in money itself in the currency that we use in our daily lives. That is cool because well, A) money is a very universal product. So the TAM of the US dollar is enormous. But B) once you have embedded philanthropy in money itself, you can actually embed it in in other things too. So you can go to your boss and say, hey, I want my next paycheck in Glo. Well, now your salary is lifting people out of extreme poverty. You can split bills in glow, you can actually run whole companies on the Glo dollar as the base money layer. And now suddenly, everything the whole company is doing with money, that's all lifting people out of extreme poverty. So this way, you can actually make that that pie chart of, of money in a US households contribute to good for the full 100% rather than just this tiny slice of whatever they're willing to, and able to give away. It was very long sentence, but I hope that...
Kevin Owocki 25:46
Yeah, I mean, it feels like the exciting opportunity here is that people don't have to remember to donate. If you just embed philanthropy into the economic system, then you kind of set it and forget it, you just go about your economic activities and know that you're producing positive externalities, which is fundamentally more scalable than remembering to donate. So it reduces the cognitive load. And that also creates more scalability that might be too reductionist, but those are kind of some of the key key points that I heard.
Jasper Driessens 26:22
Yep, totally agree. It's that and it's, indeed the scalability. So you know, there's a group of people who donates 10% of their yearly income. That's called The Giving What We Can Pledge. And that's considered very extreme. So that's a group of people there. They're among the most philanthropic, charitable people. And they too, like 90% of their money, is money that they don't give away.
Kevin Owocki 26:57
Yeah, it kind of reminds me of when I used to work at a mutual fund company. And I remember them spending a lot of time trying to get people to automate their investments in their retirement account so that like every paycheck, you get, they would try to push people to have like, 3% of their paycheck go into their retirement account. And people will save more over the longer term if they're just always investing 3% more. And so it just kind of reminds me of that, but but for philanthropy, so I think like set it, forget it, nature is really pretty powerful.
Jasper Driessens 27:36
Yeah, totally agree.
Kevin Owocki 27:40
Well, I'm, I'm curious. I'm curious when the launch is, how do people get involved? How can they how can they participate in your ecosystem? And you know, what opportunities for engagement are there for the listeners of the Greenpill podcast, most of which are pretty active in web3?
Jasper Driessens 28:02
Garm you wanna take this one?
Garm Lucassen 28:07
Yeah, sure. Maybe? Before I start going off on a limb, Jasper do you want me to say just Q1 launch, and then we want them to consider shifting to Glo as their stable.
Jasper Driessens 28:29
Yep, sounds good.
Garm Lucassen 28:33
Do we want them to be active in social and stuff too? Yeah, maybe we can say...Good question, actually. Yeah like, follow us on Twitter. Yeah, it's like a classic. But of course, that that is definitely nice. I'd say, you know, the easiest way is follow us. And then once we launch in q1, actually buy some Glo on the DEX help us grow the market cap. And then if you're really excited, you know, you can actually start building on Glo Yeah. And then glodollar.org/greenpill link.Okay, cool.
Jasper Driessens 29:23
Maybe you can see we're trying to get this thing from zero to one.
Garm Lucassen 29:30
Kevin Owocki 29:32
I think it's fun that you're having the CTO answer the how can people get involved question when you're the chief marketing officer, but it's, it's it's fun to watch? Yeah. So maybe I'll just ask again, and we can we can take it from there.
Garm Lucassen 29:45
Yeah, sounds good.
Kevin Owocki 29:47
Cool. So how can people get involved in Glo say that I'm totally bought in on embedded philanthropy and I want to help build this movement of zero extreme poverty, by by helping Low launch and getting involved in the glow ecosystem? Where can I do that? How can I do that?
Garm Lucassen 30:06
Yeah, great that you're so excited. I think for starters, go to glodollar.org/greenpill, and then join the waitlist there. So that you maintain up to speed on everything we're doing. We are very close to launching on decentralized exchanges that should happen in quarter one. And maybe by the time you're listening to this, we actually are available already on uniswap, most likely at scale. So when that's the case, we would really invite you to consider changing your stablecoin holdings to the Glo dollar and starts help us make an impact for the better in the world. And I think we're really at the stage where we're trying to take this from from zero to one as a project. And one of the key things that will allow us to really make Glo successful is if others start building on top of Glo as well. So one thing would be to start a another project on top of the Glo dollar or two includes Glo , as a token in the products that you're building yourself as an alternative stable coin that you like and support. And then finally, I think what we believe is very important as well for the long term success of Glo is to go beyond crypto. So it is sort of my personal dream and desire and ambition, that Glo will be used to exchange goods and services not only in the digital realm, but also in the physical realm. So I'd love for people to start accepting glow for maybe a cup of coffee, or a T shirt, perhaps the green pill swag, or the Schelling point swag could also be bought using Glo. I think, yeah, we're really looking for more projects to sort of sign on and start accepting Glo as a true stable coin.
Kevin Owocki 32:18
Yep, so it seems like y'all are about to launch, you can sign up for updates on the launch of glodollar.org, you can go to twitter.com/glodollar, G-L-O dollar, there's no W there. And once it's live, you can hold, you can HODL, Glo. And of course do your own research before HODLing any token of course. And and if you're a dapp developer, you can integrate glow in to your ecosystem. And it's an ERC 20. So lots of stuff can be built on top of it. And the launch is sometime in q1. So check out glodollar.org If you want to if you want to get involved. The right Mr. Exactly. Polygon, maybe we're launching on the theory of network but also Baliga on that same time.
Jasper Driessens 33:13
Future expanding to you know, a number of of chains, but that's where we're starting. Great.
Kevin Owocki 33:22
Well, is there anything that I didn't ask that you all want to talk about with respect to Glo dollar? Why you're so passionate about extreme poverty, embedded philanthropy, all the things that we talked about here? Is there anything I didn't ask that you want to say?
Jasper Driessens 33:35
That's a generous question. Thanks. Well, maybe one interesting thing is, you know, Garm mentioned the fact that we definitely want beyond crypto adoption. And we sometimes get the question like, What makes you think that after all of the cryptocurrencies that have tried to get adoption as a mainstream means of exchange, which actually has been the promise of crypto since the very beginning of Bitcoin and has never been fulfilled? What makes you think that you're, you'll be able to get this kind of adoption? And my thought there is that you know, people people wonder like, Okay, why is Bitcoin not used as a means of exchange? And then the classic answer is, well, it's too volatile, right? You don't want to pay your pizza on Bitcoin and then see it's be worth 100k A bit later. Okay, sure. But that that problem is solved by other stable coins, like other stablecoins are actually quite ready to be used for everyday payments. And still, I don't know anyone outside of the crypto world who's doing that who's actually buying their groceries with with Tether or USDC. And I think the answer is like why would you? So for instance my parents, they're pretty happy with their with their debit card that just works in it. grocery store. And then you can say, well, but stablecoins are nice because it's programmable money, or you have cross border remittances. Or you don't have, you know, all of the intermediary parties in between the transactions are instant settlements. Like, sure, yeah, that's amazing. And like, as a technologist, I love that. But my parents don't even know what these words mean, they just want to be at the grocery store. So I think to break through as a means of exchange, like crypto shouldn't be just as good as transfer by means of exchanges, they should add something that tradfi means of exchanges cannot do. And my hope is that the ability to lift people out of extreme poverty at no cost, that that might be the killer app, the killer feature, let's say, that actually makes people want to switch to something that is not something they're used to. Let's see. But that's, that's what we want to work towards.
Garm Lucassen 36:10
Maybe to add to that long thought, with some more thinking, I think there's also a natural dynamic that we'll be able to create that some other stablecoins aren't able to create so far, which is due to the embedded philanthropy aspects of the Glo dollar, we will be able to, just by the virtue of that pitch, attract people who are normally not so much into crypto to also put money into the Glo dollar. And we've already spoken with with quite some people who have said, okay, sure, I will hold some money in Glo, but then I will try to spend it as well as I can. And only if I am able to spend it, am I going to buy more. So what I anticipate will happen here is you're gonna have a new group of people who've never held any crypto before and have no interest in, in crypto in and of itself, they will have a new sort of means of payments, and they will want to pay with it somewhere. And then some smart business owners out there are going to think, hey, this is a new sort of niche that I can cater to, they are possibly quite sort of values-aligned to whatever that business is doing as well. And they may actually start to accept Glo out of sort of a altruistic motivation, but also a business opportunity. And if that happens, you sort of have fixed the cold start problem in the sense that you have people who want to spend stuff and you have businesses who want to accept it, then you can really get a payments ecosystem going. And that's not something I've really seen successfully develop much in other web3 new cryptocurrency projects so far.
Kevin Owocki 38:21
Yeah, totally. Well, it's really great to see the traction that y'all are making. And I think that you're doing something new and innovative that hopefully creates positive externalities for the world. So yeah, excited to see the launch and see where it goes. And, so yeah, for the for the audience out there, check out glodollar.org Go to twitter.com/glodollar, G-L-O dollar, and I'm looking forward to seeing how things grow in the future. So thanks so much for coming on the pod.
Jasper Driessens 38:53
Thanks for having us. Real pleasure.