JUST ONE WORLD WITH MATTEREUM
… Everyone, Everything, Everywhere.
In the launch paper for the Mattereum Group’s MATR token, which recently went on sale* I talked about how Mattereum’s groundbreaking innovations create an enforceable legal connection between the token representing an asset and the tokenized asset itself, and how this has the power to completely transform business for the future, making Mattereum bigger than Visa. We do this with a combination of legaltech solutions that connect the 1958 New York Convention (NYC) on Arbitration and the UK Judiciary Taskforce (UKJT) Digital Dispute Resolution Rules using the blockchain, which is going to enable a once in a century transformation, like when music went digital.
Now, I want to unpick exactly what this means for the future of trade.
I see the global scope of the blockchain as fundamental to all this, which is not quite the same thing as globalisation, but close. Anybody can run Free Software, anybody can generate keys, so the blockchain is universal in that sense. The best fit for that global scope in legal / trade systems is the New York Convention on Arbitration. That’s 170 countries. So wiring up blockchain transactions to the NY Convention is close to global scope (it skips North Korea - but then everything does - and a few other places). This is supercharged by the UK Jurisdiction Taskforce Digital Dispute Resolution Rules which make a ton of blockchain-specific provisions which can be invoked from any of the New York Convention counties. This gives some analysis of the rules
Some of the “Mattereum magic” has been in figuring out how to use the NYC / UKJT system to carry things like legal definitions of assets on chain in a way that can be seen in those 170 counties. The Mattereum Asset Passport (MAP) does some very sophisticated things by using suites of contracts to define asset value and risks. This makes the blockchain vital - if you try to make something like the NFT/MAP system work, only on paper, the complexity goes through the roof because you don’t have atomic swaps and various other blockchain capabilities on hand. It’s a neat system: the solution to trade on the blockchain requires the blockchain to work!
I am personally pretty pro globalisation because trade is always a good alternative to war, and rival trade blocs often wind up at war, but I do think 1990s American-led globalism is dead. What’s next?
There is a very clear difficult path forwards: we could very easily wind up with a world which runs on three incompatible global trade technology platforms: the American VISA-SWIFT etc. regime, the EU Digital Product Passports etc. regime, and the Chinese Belt and Road etc. regime. In this instance trade between these blocs will slow down over time as the technical and legal friction of trading across borders is reduced within the systems, but trade between these systems is more costly and difficult. I lay out this case in some detail here (which contrasts the blockchain with high frequency trading systems). You can even find threads of this model in my 2015 “Programmable Blockchains in Context” piece written for the Ethereum launch day. The problems database systems have interconnecting using APIs are even more severe when we start looking at things like automated customs clearing systems.
Is there a more peaceful, positive path we could take? Maybe this: internet-led globalism: Wikipedia style global shared resources, and Alibaba-style free trade. “One ERC721 NFT per item” assets work pretty much anywhere. “Many ERC20 fractional ownership tokens per asset” is likely to work best in the EU under MICA, at least at first. So the goal state is “world trade moves to the internet” — a “back of the envelope” calculation would be $250bn of savings a year, estimated – and “real estate moves to the blockchain” — $150bn a year of savings, estimated.
This is a different “theory of value” of the blockchain to the bitcoiner’s “governments can’t stop printing money so eventually all fiat goes to zero and only Bitcoin remains” model. In practice governments don’t die easy. They’ve got moves: they’ll use them. So the hardcore “internet maximalist” view is centred around trade not money-like tokens, we don’t care what tokens are used to pay for real estate: ether, dollar coins, wBTC, digitised gold bars, CBDCs, SDRs, Doge, what we care about is the transactions happen basically paperlessly, AND we get a cut of the transactions for securing them. That’s our business model: get as much of $trillions of transactions on chain as possible, and take our cut from every one. Currently it’s all still 30-day invoicing and bank transfers once you start routinely dealing with assets over about $10k, never mind the arcane mess that is real estate transactions. Some of the regulations governing that are still written on goat skin, and you breathe a sigh of relief if a transaction only takes three months, because that is currently what passes for fast and smooth.
We aim to change this, once and for all.
If this takes off, it’ll do for real estate and trade:
- what Big Bang in the 1980s did for trading stocks and shares (electronic exchanges replaced human face to face exchange in trading pits!!!)
- what Spotify did for music
- what Amazon did for physical goods purchases
- what Netflix / YouTube / TikTok did for video
Digitisation of entire industries is routine at this point. Each one needs new technology. Amazon needed HTTPS cryptography and certificate authorities. Spotify and Netflix needed The Cloud, and so on.
Our bet is that real estate and global trade need Ethereum to move them online.
If we are right, your transformation will be much larger than just tokenizing stocks and bonds and revenue streams from rental homes, the current “RWA” leaders. Stocks and bonds etc. are already massively digital and traded on the internet, tokenizing them is an additional improvement but an eToro-type training app isn’t so much worse than real tokens.
The improvement is incremental.
But enabling internet trading for assets that are currently ENTIRELY manually traded is an absolute game changer. Half a trillion dollars a year of savings by the time cars and a few other things are added to the mix. That’s a lot of potential.
Just to quantify it a little.
Half a trillion in savings, cut five ways: buyers, sellers, exchanges, technology providers, traders/market makers/lawyers and other middle men niches that are created - three out of five are maybe new companies. $300bn a year at a 10x multiplier suggests $3 trillion in market cap for the companies living off that revenue stream, kind of about the size of the entire internet retail industry that currently exists. Now you can argue this 50 different ways: 10x multiplier? How long will it take to get to this scale? Why did Tradelens fail etc, but there are four billion dollar companies just trading sneakers right now.
What do you think tokenized real estate is going to do?
And we are playing for the position of “the company everybody uses to lift their assets up to the blockchain”.
All the global legal stuff and the risk management and dispute resolution and so on — build your own or use the same stuff everybody else uses. A parallel there is the ISDA template contract which carries most of $600 trillion of derivatives. Standardisation pays! That’s one paper contract template that defines what a derivative is, broadly speaking. (I should say the $600 trillion of derivatives mostly cancels out — it’s about $20 trillion of actual money so about 10x the size of the crypto market.)
These macro trends are huge beyond all imaging, they’re just staggering in scope, and yet we see people getting wildly excited about relatively small local transformations - remember that fashion for “decentralised Uber” for a while? It’s potentially a really good business, but the city itself is up for grabs, not just the taxis!!
It’s all a question of scale in the end.
So with a story that large, where do you start?
“There is only one world and trade can and should work the same way everywhere” and the rest just follows.
Ethereum needs a new narrative. Ethereum needs a new plan.
THIS IS IT.
And all this comes down to enabling legislation in the end:
- UKJT digital dispute resolution rules (tertiary legislation?)
- MICA in the EU (coming into force by degrees, starting later this year)
- Electronic Trade Documents legislation in the UK (brand new late last year)
Getting things up and running to fully utilise the global opportunities created by the new legislation is key. That’s what opens up their new vistas.
That’s what we’re doing.
Those are the vistas that Mattereum is opening up.
Just One World with Mattereum.
Find out more about Mattereum GmbH’s token sale*.
*The Mattereum Discount Token (MATR) is available for purchase through Mattereum GmbH’s fully regulated German crypto exchange partner, Swarm. Buying MATR is subject to terms and conditions in eligible jurisdictions — in particular, residents of the United Kingdom and the United States of America are excluded from the public sale of MATR.
