As the Community Ambassador of V Systems, I think that is the most common question I’ve faced regarding the project in the last 11 months since I’ve been with the project. Although, that does not elude from the fact that there have been far more inquisitive and technical inquiries about the project or the tech behind the scenes. I guess it is my simplistic and mundane nature to focus on the silly things that tend to leave a lasting mark in the memory.
However, when you take away the humor from the perspective of this question, it evolves into quite an endearing query, one that could not be resolved with a simple answer. I’ll give you the official version of the response that we give our community members;
Some of us define V as virtualization, however, V may also mean different things to different people. We have received different amazing interpretations of what V SYSTEMS stands for so we have decided not to formally define it ourselves, and let the community create its meaning.
…yeah, well you are not getting closure so soon dear readers!
So what is it really? What is V Systems all about?
V for … DeFi
To be precise, V Systems is all about Decentralized Finance. It is about virtual economy. In fact, when Sunny King first launched the project, he named it VEE — Virtual Economy Era. It was later renamed to V Systems for reasons not known to me.
Now, I will not pretend to assume that you as a reader, 2 years since the project was first announced, are unaware of what V Systems’ core principles are based on, but for the sake of those of you who are indeed new and green, let’s have a quick recap, shall we?
The aim behind introducing a decentralized financial system is to bring equality, inclusiveness, and progress on a global scale. Significantly reducing the costs typically associated with traditional financial services. More importantly, the motive here is to present the world a new friction less financial tool in this new era of virtual economy.
In our world today, the profits of some businesses are more than a few countries’ GDP put together. A decentralized financial system will not only make transactions transparent but will also provide equal access to financial services for everyone.
It is important to remember that traditional financial systems today significantly rely on banks and other intermediaries to function. Whereas a DeFi ecosystem such as V systems, or any DeFi app built on a decentralized principle, would not.
With the help of a DeFi application, Sunny hopes to empower the common man, a small business man, a vendor, or even a multinational organization the ability to control their finances at all time.
What makes DeFi so attractive?
When you think of it, one of the most prosperous nations of the world today, the United States of America, is founded on the principle of a decentralized government. The world economy, like the country of USA, is pretty large. But unlike the land mass of USA, the world economy will only grow into the future. As it grows bigger with each passing decade, managing it, for the centralized regulatory bodies, would simply become inefficient.
Decentralized systems are not without their flaws however, but to pitch the idea of decentralization over centralized systems you have to first look into why people prefer centralization.
It is simply safe. Centralized financial systems are a cost saving mechanism. After all, standardization models and top down approach in an organization are all gifts of the industrial age that we still carry with us to this day. A top heavy centralized financial system is slow, although safe and predictable, individuals, whether that be a single person or a multinational corporation, can delegate security issues for the regulatory bodies to take care of.
On the other hand, with decentralized finance, the philosophy shifts away from the one size fits all rhetoric. Since everything good comes at a cost, the decentralized financial system lacks the luxuries that the centralized ecosystems offer.
So why go the decentralized way anyway? you may ask. Surely, there has to be better alternatives to a decentralized system that isn’t perfect?
Well, the thing is, the concept of decentralization is nothing new, it is in fact medieval, ancient perhaps. For hundreds of years prehistoric human societies have functioned on decentralized systems. Take for example a tribe in Central America might have had its own currency system, its own cultural norms, and these were completely different from adjacent tribes in the region. Historically, beaver skins, wampum and tobacco were used in Central America where paper money and coins were unavailable. So, when you look at it in terms of macro economy between the tribes, any two tribes’ currencies functioned as a store of value and medium of exchange, whether they used beaver skin, or wampum, or any thing else for that matter. However, these currencies existed independent of each other and the values of any such currencies were largely negotiated during barter trades.
As societies around the world grew bigger, their needs started changing. Gradually, a centralized structure to economy was becoming a favorable system for economies to function. As a matter of fact, centralization was the ‘change’ that evolving societies used as a catalyst of growth. Whether it be money, governments, organizations, there was an inherent usefulness to all of it coexisting in a single location,or functioning under a single authority, just like a well oiled machine.
The problem was, centralization naturally started evolving into a closed system, mechanisms of monopoly and power. The resulting effect was, anytime a need for exchanging information or things of value arose, there were various obstacles that had to be taken care of first. Things like discrepancies in values despite standardization, approval bottle necking, resistance to innovation and so on.
So how does decentralization — an archaic system, solve these issues? Well for that you have to wait for the next installment of this article. In that article, I will discuss the various problems that decentralization solves and also the ones it creates. I will then discuss how Vsys fits-in in all of this and the various innovations the Vsys team plans to carry out.
On a personal note; some of you may have noticed that I was internet-silent for nearly a month between May and June. The reason? Covid19 Lockdown, resulting riots from the lockdown, the cascading curfews that followed, and finally the Super Cyclone Amphan. Combined, these factors basically forced me to live like a caveman without internet or electricity for the duration of my absence.
But now that I am back, expect more articles and opinion pieces being published through me here on Medium and also on my Steem page.