The BRICS Unit

Taking all information from Pepe Escobar’s post:  Pepe Escobar: How the BRICS+ Unit Can Save Global Trade

I mention that I am convinced Pepe’s work was absolutely correct as provided to him.  I also know that without a deep technical and background in this field, and with deep respect for our longstanding friend Pepe, he may not have had the in-depth knowledge to ask some necessary questions.

So, I will ask these questions.  Allow me, these questions will not be of the “academically validated” type, but mainly home in on:

1. This looks like a commercial project.  You may think so too by the end of this.

2. This project has so many Atlanticist and Western technologies that it is questionable if this is BRICS.  You may think so too by the end, but feel free to prove me wrong, or even partially wrong.

3. If this is really where BRICS stand in their development of a tokenized project, it is deeply disappointing.  We have a whole lot of packaging that does not convince a person schooled in cryptographic methodologies.  BRICS needs its own blockchain and should not plan to run on a commercial blockchain as a token.  This is not the environment BRICS should be.  It is cheap and nasty, and tokens (handled later in the nomenclature section) are generally like vanity number plates.

4.  There is no top-level technical expertise, and projects of this nature need heavyweight and visionary technologists with a deep knowledge of the industry at the top.  There are, in the main, two aspects: the technology and governance of the blockchain, which will include cost management.  It is a critical aspect.  I am not using the word critical here lightly.  If one does not have that in balance, one will fail, as the many failed blockchain projects attest to in the short history of this technology.  Do we really want all BRICS countries to come to a screeching halt if Cardano suddenly falls apart?  How on earth can we put our trust in an external blockchain?  This is like banking at Citibank.

Nomenclature 

I will call any discrete aspect of the system as described an element, (in reality it is a segment as worms have segments) and will call the unit itself a token, as this is the correct nomenclature for a cryptographic product in both proof of work and proof of stake systems.  The correct nomenclature helps us avoid the esoteric and marketing hype.  In fact, the Unit foundation calls it a token.

What is the Unit?  

As described, this is neither a stablecoin nor a cryptocurrency.  It is understandable why this is said that way, and it is meant to overcome bias and distrust in the general community.  The distrust in the word stablecoin exists in the Western community, in the main.  Why do we feel it necessary to specifically mention that?  Are we writing for Westerners?  I am sure China’s E-CNY does not have that connotation of distrust and the Unit is not a ‘post-stablecoin.  In fact, it is exactly that in a true definition, a stablecoin where the price is arrived at by utilizing the gold price at the moment and the currency exchange rate of a currency or basket involved at the moment.  A stablecoin in the traditional, is a coin that has a value exactly the same as your currency.  A Dollar stablecoin is tethered to the US Dollar.  The E.CNY is tethered to the Chinese Renminbi.  So, we’re adding gold.  It is trivial.

But the Unit is not a stablecoin as it is a token.  A different price discovery mechanism does not make it what it is not.  What are we messing around with Tokens?

Just as China’s E-CNY is a peer-to-peer electronic cash, an analogue to the renminbi.  Token fits with the mining or minting process on the blockchain.  If this is not correct, perhaps we should have a name that describes it technically.

I mean, according to the description, we are going to mint tokens and run piggy-back on the Cardano Blockchain, no?  Why is Ada specifically mentioned?  Is there interplay?  Costwise perhaps?  Yes is the answer and the problem.  We’re now developing the Cardano Blockchain and paying for transactions in Cardano.

White Paper 

Customarily and correctly, projects such as this require a white paper.  Only the very fact that we do not have a white paper, front and center, tells me that we are dealing with economists and bankers, and this does not a technical blockchain make.  There is no technical competence in this project as described.  We see it here as well: 100 Units have been minted (in a test form), and if one is at this stage of development, these questions must already have answers.  Some of the information we were supplied is questionable.  I will steer clear of the more technical aspects to make this as understandable as possible for those without a technical background in this sphere.

So, I found a white paper, but it is called a light paper, and indeed, it’s feather-light.    https://wp.unitfoundation.org/assets/lightpaper_v17102025.pdf

Let’s stay with The Unit Foundation and its three members.  The first one they called BRICS+, the second is the Eurasian Economic Union, and the third is West and Central Africa.  But, these are possible future use cases and certainly not real.   It then has an AI director and a real director (I think).  AI does not substitute for smart and visionary technical expertise with deep knowledge in the industry and in this field.  One has to roll up one’s sleeves.

Stepping back to the light paper that was apparently produced by the International Research Institute for Advanced Systems (Irias).  Where do they fit?  What have they done?  A few publications, a few events.  There is no top-level technical smarts on blockchains, cryptos, or tokens.  They’ve been around since 1976 and consist of ;

• Republic of Bulgaria — A. IVANOV, PhD, Permanent Representative of the Republic of Bulgaria in IRIAS Council.
• Hungary — Professor T. ASBOTH D.Ec, Vice-president, Hungarian Council of the European Movement, Permanent Representative of Hungary in IRIAS Council.
• Republic of Cuba —  Rodriguez Batista, Deputy Minister of Science, Technology and Environment of the Republic of Cuba, Permanent Representative of the Republic of Cuba in IRIAS Council.
• Mongolia — Professor S. TIMUR-OCHIR, Vice Minister of Education, Culture and Science of Mongolia, Permanent Representative of Mongolia in IRIAS Council.
• Russian Federation — E. VELIKHOV, Full Member of the Russian Academy of Sciences, Permanent Representative of the Russian Federation in IRIAS Council, Chairman of IRIAS Council.

There is zero top-level technological expertise, and the paper is light.  In fact, it is transparent for what it does not say.

The How.

The Unit Foundation (https://unitfoundation.org/) states:  We leverage BRICS+ Currencies and Gold into a Unit Ecosystem.  Apparently, according to these bright sparks, it has never been done.  To my knowledge the part with currencies has not been done, excepting it has, with existing stablecoins  Here is a simple ad for 10 Gold backed cryptocurrencies:  The https://primexbt.com/for-traders/gold-backed-cryptocurrency/  To do the sums is for a good programmer designer trivial.  But let’s remember that a country such as El Salvador has made Bitcoin an official currency and offered incentives to adopt it.  So did the CAR.  Where is that currency number now?

It is statements like this that tell me clearly there is no technical expertise of the required weight here.

Let’s go and look for the gold price and for the currency value at the time. 

The Unit, in order to make a price for a commercial transaction, needs a current gold price.   They state they get it from here:

https://www.bullion-rates.com/

The Corporate Headquarters is listed as 800 N. King Street​
Suite 304 1474​
Wilmington, DE 19801

So this is one of those Delaware companies that live in a Suite.  It is what a virtual company looks like.  Have these Unit designers heard about Hong Kong?

They also need a currency value.

https://www.xe.com/

So BRICS will be using XE, which is listed on the Nasdex and headquartered in Canada, and is in essence a money transferer.  (Have your IBAN (International Bank Account Number ready to make sure your transfer is sent to the right destination.)  More western one cannot get.

A comment such as this does not fit BRICS:  Even JP Morgan admitted The Unit is “perhaps the most thoroughly fleshed-out of de-dollarization proposals that exist in the cross-border transactions space for BRICS+.”  May I ask, who in JP Morgan, and where is the technological expertise to even make that statement?

So, the Chairman of the Launch Committee is Bilderberg. And one of the organizations that they are working with is in Brussels.

I cannot even comment.

How will this Unit affect the whole of the BRICS infrastructure.  I mean, what will it do?  

Once the UNIT tokens are minted and the nodes of the network are synchronized, they are completely fungible and can be used as any fiat currency: a simple account-to-account transfer using existing banking infrastructure should suffice.

Let us look at that a little deeper.

Nodes of the network – which network?  Cardano?

Existing banking infrastructure – I can guarantee you the banks where I am will not touch this thing with a barge pole.  It is also a wrong statement which I don’t even want to go into.  I repeat, technical expertise with vision and deep knowledge of the industry is lacking and it shows.

Then I hear you say:  It’s only a couple of lookups – trivial.  Well, what happens if the lookups disappear?  All commerce in all BRICS countries comes to a screeching halt?

Let me also not comment too deeply on fungibility at this stage.  This is correct. A token, a coin must be fungible.  But what happens if Blackrock swoops in and buys every Unit available?

Cardano Blockchain

We end up then with BRICS running its Unit as a token on the Cardano Blockchain.  When I saw that at first my response was:  WHAT?  What happens if the Unit loses its friendship with Cardano?   What is going to ensure that Cardano blockchain does not act like a Volkswagon vs a rocketship.  Will Cardano scale in its token environment?  Is there a realization that scalability is one of the most difficult technical problems to solve?   What is the biggest token transaction that Cardono ever processed?  What are the benchmarks vs the current Russia, China, Iran trade to start with?  Is this even approaching Visa and Mastercard trade worldwide?  We are working with Russia and China trade, completely in local currencies, and the numbers are huge.  We are working with the Russian and Indian trade, which is over 90% in local currencies.  I will forecast that Cardano will fail spectacularly if a smart contract and one of the big transactions multiply by a number of countries must be processed.  To give you an idea, China carried out its first smart contract years ago, buying copper from Australia.  Why are we using Western technology that has not proven itself in terms of massive transactions while China has the technology?  I have nothing against Cardano, but Brazil runs PIX very successfully.  Have we even considered PIX as a basis?  It belongs to the Brazilian State, and not to a Delaware company.  Cardano has over $1 billion in volume per day.  So, that is the volume of transactions it is able to process because we cannot say it can do more, if we have not seen or tested or benchmarked it.  What happens if you need to put through triple that in a few significant transactions?.  Why, when we have the technologies in-house in the BRICS countries?

Following on from this question:  Are any of the elements, as explained, proprietary, or are we working in open source?  I hope so, but if not, who owns the proprietary elements?  Further, who is developing and programming those elements and for who?

Strong recommendation

Do the work and develop a blockchain for BRICS.  Position it in a BRICS technology company in a BRICS country.  Blockchains are all open source and are an easy start, given the number of iterations already through the few years.  Get the technological expertise to the level that is needed.  Let the foundation do some work.  Raise alternate exchanges in Eurasia. Then build a blockchain that is bereft of any Western influence. Then and only then do technical interfaces with Western countries, as interfaces, and not as determinative technology.  Then only BRICS and SCO and Global South and Global East can truly trade with independence.  Do not depend on Western banking systems because ‘one day the West will come to its senses’.  This cannot be an Atlanticist effort.

There is more, and I’ve touched only what stood out in the first article, focusing on governance issues.  I am convinced the Michael Hudsons of this world can tear this apart from an economic standpoint.  The Unit, as envisaged, will fail if it is not rescued now, given the information we have.  I say that with absolute confidence, as the required level of technological expertise is nowhere to be seen and neither is the governance.  A white paper, and not a light paper please.  The cost, and yes, there is one, is a black hole.  Ownership is a black hole.  Or is BRICS the Unit also going to register a virtual Delaware company?

I also want to know if this Unit is so fungible that I can trade it, where is the wallet?   This is a test question that addresses custodial or non-custodial ownership and issues of Who Owns What and Where is it stored?  This question will define where money, or rather Unit tokens, are kept.  Have you spoken to the best block explorer, which is a Russian company?  It is called Blockchair: https://blockchair.com/ Nikita, the designer and long-term developer, is a brilliant technologist and can immediately recommend who to work with.

Would you not abandon or re-vision your current effort because it does not use BRICS resources?  I can give you some of the most incredibly talented technical resources on this planet.  One is married to a Russian, lives in the East, knows the industry backwards and forwards, is a highly talented developer, can manage development teams, and is a committed Orthodox Christian.  No, he won’t do it for you, but he will set you up and get the governance issues in shape.  I know this Frenchman, and it is the same story.  He won’t do it for you, but he can set you up.   The talent is out there, but the truly visionary talent pool is limited, and you don’t have it.

This is a vast topic, and I’ve hardly scratched the surface.  I’ve not looked at the composition of The Basket as it is not stated with clarity.  How do you figure ‘equal portions of major BRICS currencies: BRL, CNY, INR, RUB and ZAR’?  ZAR will thank the creators for that one.  I also find a level of non-transparency.  Those of us that took the trouble to learn this environment from inception, are intent on transparency.  We are absolutely accustomed to diving into the code and assessing it on a granular level.  This is how the technical resources of BRICS countries will start their analysis to decide whether they are in or not.  It is perhaps a timing issue, but with a light paper, this level of transparency should be visible.  It is not.