(upbeat guitar music) - Hello and welcome to "Prairie Pulse."

Coming up a little bit later in the show, we'll hear music from the band Walking Phoenix.

But first, joining me now is our guest, Dr. Prithviraj Lakkakula.

- Yes.

- Dr. Lakkakula, thanks for joining us today.

You're the research assistant professor in agribusiness and applied economics at NDSU, okay?

Well, as we get started, tell the folks a little bit about yourself and your background.

- Yes, sure.

So I'm Prithviraj Lakkakula as John mentioned.

And first of all, John, thank you for having me here.

It's a pleasure to be here.

So I'm originally from India, so I came here to pursue my higher studies, I did my master's and a PhD in food and agriculture economics.

So I'm passionate about three things, agriculture, being from a farm background where my parents are still, you know, do farm back in India, so I'm passionate about agriculture and the issues related with agriculture, and the second thing is, being an applied economist by training, I'm passionate about gaining insights from data.

And the third thing is, you know, applications of, you know, solving different issues related to agriculture and automation.

Whenever I get chance to automate certain things in my day-to-day life work tasks, and that is one of the passion as well.

Here, I'm, you know, my research is about economics of blockchain technology, that I've few papers published in, and I did my price and demand analysis, and more recently I've been into data science machine learning as well, especially the issues related to agriculture.

- Okay.

So what is it you teach at NDSU?

What are your classes?

- Yes, so mine is primarily a hundred percent research appointment, but I had a opportunity to teach different classes at NDSU.

One of them is intermediate microeconomics that I taught two semesters.

And another is agricultural price analysis, which is another course that I taught.

- Yeah.

Well, we're here today to talk about different things, but Bitcoin and cryptocurrency is one of them.

But before we start that, you mentioned blockchain technology.

What is that?

- So I think if you look at, you often hear that blockchain there, you know, people confuse between blockchain technology and Bitcoin, right?

But they're actually different.

So Bitcoin is the first open source digital currency that runs on its own with peer-to-peer network without a centralized party involved, without banks for example, involved in it.

That is Bitcoin.

The underlying technology that makes Bitcoin to operate without a centralized party like bank involving is blockchain technology.

So what is blockchain technology?

Blockchain technology at a very high level is allows a bunch of computers, which are also called nodes, to interact with each other at regular intervals about true state of distributed ledger.

So a ledger is basically a record keeping, for example, a set of transactions like you see in the bank statement.

If you look at a simplistic example.

So, but you know, there are three key aspects that are very unique to blockchain technology.

The first thing is it's a shared, the ledger, the record keeping that we are talking about, is shared among all the parties.

In this case like for example, computers and nodes that are operated by individuals, right?

So that is shared among all those computers or nodes, right?

That is one aspect.

So it's not with the centralized party, a copy that is distributed ledger.

So that is one aspect.

The second aspect is immutability.

Immutability in the sense that when you look at the transactions, that cannot be changed.

So if you look at the actual term blockchain, right?

So it's a set of blocks with a set of transactions in each block that are interconnected.

And once the block is formed, it's tamper proof.

So we cannot change a certain aspect of a transaction in a block.

If something has changed, let's say if someone wants to change, then all the subsequent blocks which are interconnected has to be changed as well, which is quite impossible, near to impossible to change that, because you have to change all the subsequent blocks of information, which is near impossible.

So that is another aspect.

And the other key term is append-only fashion.

So appending in general context is you can only add a block to a set of blocks.

You cannot change it.

You can only add blocks of information.

So these three key aspects make blockchain unique, you know, compared to traditional way of doing things.

- So what is blockchain technology used for?

- Blockchain technology is basically, let's take an example of Bitcoin, let's say.

So John, if I want to send a hundred dollars from my account to your account, right?

So what are the parties that are involved in the middle?

There are banks, right?

For example, if our banks are different, there is my bank involved and there's your bank involved.

So my bank make sure that I do not double spend in the sense that my bank makes sure that I will not transfer the same hundred dollars to you and the other person at the same time.

So it is making sure that I'm not double spending the same amount, right?

So it's a verification.

So it makes sure that I have enough amount, first of all, in my account to transfer it to you, and it networks with your bank to confirm that it is the John that is I am sending, the same John that I am sending the money to.

So there are two aspects here, right?

Verification and the networking between the banks that is happening in this aspect, traditional way of doing things.

The blockchain technology basically all the functions that the banks are doing, the blockchain technology replaces that, and it does all the things that the banks are doing in this context.

So it essentially eliminates in this context the banks or changes its role in a certain aspect.

So that is a technology basically.

That is the technology behind the cryptocurrency or in this case, Bitcoin.

- Okay.

So crypto, how does it work and how did it get started?

- Yeah, so if you look at 2008, somewhere in November if I'm not wrong, so there was a white paper released by the name, by the person, or a group of people, Satoshi Nakamato.

And by the way, we don't even know who this person or group of people even now.

So they, he released a white paper, he or they, we don't know exactly, so he released a white paper explaining the concept behind this technology, and especially in the context of Bitcoin.

So P2P network without having a centralized party, like bank, involving in this transaction, right?

Direct transaction between sender and the receiver.

So eventually from there on, on January the first week, on I think January 4th, 2009 that's where Bitcoin has started.

So from there on it's been almost, you know, a decade, it's still in existence and it's running.

It's not stopped yet.

So there are several advances that took place since then.

So there, the concept was only Bitcoin, right?

But later on they realized that, okay, this blockchain technology can be used in other industries as well.

So they realize that blockchain technologies it can be even bigger than Bitcoin, because Bitcoin is very finance specific, right?

Current specific.

But it can be used in agriculture, for example.

I have few published papers in that aspect.

- Can you tell me who Sam Bankman-Fried is and what is FTX?

- Yes.

So it is, I understand that it's been recently a hot topic, Sam Bankman-Fried and FTX.

So let's talk about FTX.

FTX is a currency exchange platform.

Like if you have heard of Coinbase, that is US based and a public company, and Binance.

These are well known cryptocurrency trading exchange platforms.

So FTX is similar to that.

So FTX is also a cryptocurrency exchange platform.

So you talked about both Sam Bankman-Fried, so if you want to go a little bit behind, so in 2017, Sam Bankman-Fried, who is popularly known as SBF in the social media, so he established a firm called Alameda Research which is a quantitative trading firm like hedge fund.

And in 2019, he again formed FTX.

So he owns both, majority of it, both Alameda Research, which is a hedge fund, and FTX, right?

So what happened is early this year, you know, last year and early this year, there was some collapse in some of the cryptocurrencies like Terra Luna and Voyager, for example.

So the Alameda Research, which as you know, like hedge fund, they invest in very risky bets, right?

They involve in risky bets, not only like this, but in general hedge funds.

So they got a portion of it involved in buying the assets of those that were collapsed, Terra Luna and Voyager.

So until this, it's fine.

It's a risky bet.

Until this it's fine, everything is okay.

But now what happened is, because you may know that in hedge funds, they may go out of line, and because it's a risky bet.

Until this, it's okay, but FTX, you know, since there's a conflict of interest, since SBF, Sam Bankman-Fried, owns both these, there is a conflict of interest.

And what happened is apparently he moved the consumer assets and consumer money from FTX to Alameda Research and there is no real board involved to oversee this.

So that's a perfect recipe for the failure, right?

So there is no real oversight within the organization and I think that's what happened, and that's a big no-no.

So I think that is the reason.

From there on, the news got leaked out from CoinDesk, which is a popular news outlet for crypto related news.

- So what can investors do, if anything, who've lost money in that?

- Yeah, so I'm an not an expert in this, but I would imagine that what happens is actually recently the FTX and SBF, they filed a bankruptcy in a bankruptcy court.

Although it's interesting, because the FTX is originally based in Bahamas, not the US, but they filed bankruptcy in the US bankruptcy code.

So what happens from here on is basically it's a long drawn battle.

So the first thing I would imagine is they would figure out what are the existing assets that are there within FTX, and there are different components as well.

FTX International, FTX US, and different aspects of it.

So then, they'll find out whether there any other assets that SBF is, you know, invested in.

For example, he apparently owns 9% of Robinhood, which is another stock and cryptocurrency trading exchange platform.

So once they gather all these assets and you know, the courts will decide from there on who will get what and who will get first and who will get how much amount of the remaining and it's a long, long drawn battle.

- Yeah, so Bitcoin, cryptocurrency, some people say it's just a Ponzi scheme.

What's your opinion or research on that?

- So as I mentioned earlier since it's without having some institution as a centralized party since its inception in 2009, it's been almost over a decade, right?

So I think it's still working.

So I think the Ponzi, I do not agree that it's a Ponzi scheme, because they have a clear definition and that doesn't fit in here in this context.

So, but you know, but that is, I do not agree that it's a Ponzi scheme.

That doesn't fit this in this context.

- Okay, well, let's change subjects.

We don't have a lot of time left.

Agribusiness economy, you talked about.

what is that?

- Agribusiness economy you're talking about?

So I think agribusiness, if you look at different aspects of farm and agribusiness economy, agriculture economy, what drives it is the from farm to fork, right?

So there is a supply chain that is involved from farm to fork.

I think what drives is all the key essential aspects of those supply chain, but primarily, the farmers and the end consumers are the main players.

And another important aspect of what drives this is if you look at agriculture, there are certain countries which are specialized in, let's say for example, labor intensive goods and certain countries capital intensive goods.

And that's why there is a trade happening, right?

There are some countries they're very good at, they very cheaply produce certain aspects of commodities, right?

So there is a trade and international trade drives this farm and agriculture economy in my opinion.

So all these aspects.

- Is there one thing in particular ordinary folks might not understand about agribusiness and agriculture that you would want them to know and you would tell 'em?

- Yes.

So I get asked a lot of times about, you might have heard of price spikes, right?

If you look at commodity price crisis, right?

Price spikes, 2012 and before 2012, and before that it happened like multiple times.

So I think there are two things, two aspects.

If they occur simultaneously, then you know these price spikes happen.

Since I get asked this question, I would assume that a lot of people might also be interested in this.

So one aspect is a small crop for a year or consecutive years for whatever weather related events or some events all over the world simultaneously if that happens, there's a small crop, let's say, for example, for that year or subsequent years.

That is one.

And simultaneously, there is a small inventories all over the world with the different countries, you know, they're stockpiles of different food commodities, let's say.

If these two things happen simultaneously, and you can make sure that there is a price spike coming up soon.

So that I wanted to say, shared with the audience.

- So are you bullish on the US farm economy going forward or not?

- Yeah, so I lean towards a little bullish, but it all depends on certain dynamic factors that are happening all around the world here.

For example, if you look at labor shortage, that is one aspect.

And there is a lot of, especially after COVID, there are a lot of transportation logistical challenges all over the world because of COVID and thereafter.

And there are a lot of, you know, because of war that is happening, right, in the Black Sea region between Ukraine and Russia.

There are a lot of dynamic factors that are affecting here.

So it all depends on, you know, we'll get benefited, for example.

If you look at one aspect is if you look at, let's say, you know, let's take an example of China.

China, which was a relatively a minor player in corn imports just before pandemic, but now because of their domestic policy change related to support price of corn farmers, what happened is they started importing and now it's in 2021, it's a big it's the biggest importer of corn.

But Ukraine is the major supplier of corn to China.

But now with the war, they do not have capacity and there are a lot of issues there, right?

Now, I think China is looking after for different suppliers, Brazil is one of them that they're looking.

So US could also benefit.

But it all depends on how these factors interact.

- Yeah, so many things affect other things.

We are out of time, unfortunately.

If people want more information, where can they go?

- So I'm here in Barry Hall on the sixth floor.

So I'll be, you know, if you type agribusiness and applied economics NDSU, our faculty page will pop up and I'll be there and my contact information is there and I'm happy to respond if anybody contacts me regarding any questions.

- All right, well thank you very much.

Thank you, John.

- Stay tuned for more.

(happy guitar music) Walking Phoenix is an indie alternative rock band that hails from the Fargo, North Dakota and the Moorhead, Minnesota region of the Red River Valley.

Their debut album, "American Dreams," is gaining recognition throughout the music world.

("American Dreams" by Walking Phoenix) ♪ think it's time to say goodbye to my American Dreams ♪ ♪ You know they say I'm much too young ♪ ♪ To even know what that means ♪ ♪ My motivation, it seems to run out with my cup ♪ ♪ If you want me to stay, don't look the other way ♪ ♪ Come on fill it up ♪ ♪ I think it's time to hit the road ♪ ♪ Tell me where you wanna go ♪ ♪ Oh well I say anywhere but here ♪ ♪ Yeah that's all I really know ♪ ♪ My situation is that I'm worn out ♪ ♪ And a little screwed up ♪ ♪ Shots out in the dark, trying to light a spark ♪ ♪ But I think I blew it up ♪ ♪ Oh, so when you tell me that I'm whining, whining ♪ ♪ Can't you see that I am trying, trying ♪ ♪ Yeah, don't you know that it's a long way back ♪ ♪ From where I'm trying to be ♪ ♪ I think we've gotta run away, tell me where you wanna stay ♪ ♪ Oh, because this place is all messed up ♪ ♪ And it's never gonna change ♪ ♪ My inspiration seems to run out ♪ ♪ When the skies aren't blue ♪ ♪ The clouds are rolling in, let's take off like the wind ♪ ♪ Before it makes a mess of you ♪ ♪ Oh, so when you tell me that I'm whining, whining ♪ ♪ Can't you see that I am trying, trying ♪ ♪ Don't you know that it's a long way back ♪ ♪ From where I'm trying to be ♪ ♪ When you tell me that I'm whining, whining ♪ ♪ Can't you see that I am trying, trying ♪ ♪ Yeah don't you know that I bleed, oh ♪ ♪ When you tell me that I'm whining, whining ♪ ♪ Can't you see that I am trying, trying ♪ ♪ Yeah don't you know that I bleed, oh ♪ ♪ So when you tell me that I'm whining, whining ♪ ♪ Can't you see that I am trying, trying ♪ ♪ Don't you know that it's a long way back ♪ ♪ From where I'm trying to be ♪ ♪ So when you tell me that I'm whining, whining ♪ ♪ Can't you see that I am trying, trying ♪ ♪ Yeah, don't you know that it's a long way back ♪ ♪ From where I'm trying to be ♪ ("Purple Car" by Walking Phoenix) ♪ Put it in drive ♪ ♪ Only two fingers on the steering wheel ♪ ♪ Take a little time ♪ ♪ I'll waste yours, maybe you can waste mine, oh ♪ ♪ Shaky haired boys screaming at the top of our lungs ♪ ♪ Sit down, don't play it coy ♪ ♪ I want to be the one you placed above ♪ ♪ I just want to take you out ♪ ♪ I just want to make you proud ♪ ♪ Sitting in my purple car ♪ ♪ We don't have to go that far ♪ ♪ Put me on that pedestal ♪ ♪ Want you to think that I'm kinda cool ♪ ♪ Don't need to be a superstar ♪ ♪ We don't have to go that far ♪ ♪ Taking it all in ♪ ♪ Take it like an arrow through the heart ♪ ♪ DO you remember when ♪ ♪ This was just a dreams of ours ♪ ♪ I just wanna take you out ♪ ♪ I just wanna make you proud ♪ ♪ Sitting in my purple car ♪ ♪ We don't have to go that far ♪ ♪ Put me on that pedestal ♪ ♪ Want you to think that I'm kinda cool ♪ ♪ Don't need to be a superstar ♪ ♪ We don't have to go that far ♪ ♪ Wanna be the one, wanna be the one ♪ ♪ The one you place above ♪ ♪ ♪ Wanna be the one, wanna be the one ♪ ♪ That keeps you looking up ♪ ♪ Wanna be the one, wanna be the one ♪ ♪ The one that you place above ♪ ♪ Wanna be the one, wanna be the one ♪ ♪ That keeps you looking up ♪ ♪ I just wanna take you out ♪ ♪ I just wanna make you proud ♪ ♪ Sitting in my purple car ♪ ♪ We don't have to go that far ♪ ♪ Put me on that pedestal ♪ ♪ Don't you think that I look kinda cool ♪ ♪ Don't need to be a superstar ♪ ♪ We don't have to go that far ♪ ♪ I just wanna take you out ♪ ♪ I just wanna make your proud ♪ ♪ Sitting in my purple car ♪ ♪ We don't have to go that far ♪ ♪ Put me on that pedestal ♪ ♪ Want you to think that I'm kinda cool ♪ ♪ Don't need to be a superstar ♪ ♪ We don't have to go that far ♪ - Well, that's all we have this week on "Prairie Post."

And as always, thanks for watching.

(upbeat guitar music) - [Announcer] Funded by the Minnesota Arts and Cultural Heritage Fund, with money from the vote of the people of Minnesota on November 4th, 2008.

And by the members of Prairie Public.