The blockchain is one of those technologies that could have wide-reaching impacts on our lives. It certainly polarizes opinions. For some, it is a game changer that ushers in a new era of financial inclusion, a more secure financial system without intermediaries and freedom to transact with cryptocurrencies. Others see in it a dangerous fantasy of techno optimists that allows the control of financial transactions and forces the cashless society into existence. At the same time, most people have probably never heard of the blockchain and care little about it. Technology has always influenced the way we live and work, and this process will exponentially accelerate in the coming years. Critical thinking about the digital future needs to take place now, not after the fact. This conversation should include as many people as possible, because the digital future will affect everyone.
Inspiring the conversation about what’s possible
Inspiring this conversation is the main motivation behind my documentary The Blockchain and Us. Instead of explaining the inner workings and technical genius of the technology, the film centers on what the blockchain might enable. I like airplanes and use them a fair amount without knowing how to fly let alone build one. What makes you more excited? A mathematical equation about jet engines or imagining where in the world you could travel today?
Isn’t imagining what’s possible much more exciting?
Sure, the technology behind the blockchain is complex, but the same is true for other marvels of our time that everybody uses without understanding the magic inside. The dialog about technology with the potential to transform needs to become less technical, less polarizing, and more actionable. Who agrees? Say “I”! Making this film was a lot of fun, and the following paragraphs sum up some of my main takeaways.
A bottom-up movement that won’t go away
Roger Wattenhofer, a Professor in distributed systems at the Swiss Federal Institute of Technology (ETH), points out the main components of the blockchain—asymmetric cryptography and distributed systems. He continues, “It’s one of the most amazing things in science that happened in the last 100 years: You can digitally sign transactions or other kinds of information. This is much more secure than these curvy signatures we use every day, and it will probably replace them soon enough.” This is just about as technical as it gets in the film.
Christian Decker, Core Tech Engineer at Blockstream, says about the beginning of the blockchain, “What’s especially interesting to me is that it was a grassroots movement from the technology sector. It’s really a bottom-up movement from us geeks, not from established businesses trying to find a new selling point.”
Guido Rudolphi, the Founder of Cryptocash, adds, “The blockchain and cryptocurrencies are here, and they are here to stay. The whole system does not need any government—it exists. It simply works, and it won’t go away.”
More than a digital currency
Jesse McWaters, Financial Innovation Lead at the World Economic Forum, explains the main potential impact of the technology in the financial sector. “You could transform the structure of financial services. Today there are all sorts of institutions that exist to maintain sets of records, ‘trusted third parties’ in industry parlance. That role is potentially fundamentally reshaped.”
Matthew Roszak, the Co-Founder and Chairman of Bloq, points out the decentralizing aspect of blockchains: “Blockchains are networks. Today’s networks, such as Alibaba, AirBnB, or Uber are interesting, but they are centralized. On the blockchain, you’re going to have decentralized networks that are working as a cooperative.” What are potential business models of these new networks? Matthew says, “Today’s discussion is all about the technology. I think some of the challenges will be the economics of those networks, the economics of certain blockchains. Tomorrow’s discussion will be about how to build network effects off of these new railroads.”
Rik Willard, the Founder and Managing Director of Agentic Group, adds, “[The blockchain] means a lot more than just another digital currency. Its ‘a profound shift in how the Internet could be used to create new forms of value and how it could enfranchise and include people in global finance. We can have a trust relationship having never met each other. That’s fundamental.”
Electronic identity and the Internet of Things
Dave Birch, the Director of Innovation at Consult Hyperion, introduces the topic of the blockchain and electronic identity. He adds, “Maybe the technology brings new ideas into the identity space, and we need them fairly quickly. We haven’t fixed the identity problem for people but we’re about to put ten billion, trillion, gazillion things on the Internet.“
Alex Tapscott, the Founder and CEO of Northwest Passage Ventures and Co-Author (with Don Tapscott) of the bestseller Blockchain Revolution, sees the Internet of Things as perhaps the best test case for blockchain technology. He says, “If we’re going to have trillions of Internet-enabled devices doing everything from driving us around to managing our affairs to monitoring our health, they need a way to move, store, and manage value and data in a way that is secure and private. Right now, we don’t have that. I’m worried about the ubiquity of data and how it flows in and through Internet-connected devices. I think with a value platform like the blockchain, we can at least address some of these problems and may even create new opportunities.”
New skills and opportunities
All leaders in established companies I spoke with were acutely aware of the opportunities that blockchain technology brings to their doorstep. Paul Meeusen, Head Finance and Treasury Services at Swiss Re, points out the potential to access new markets. He says, “We understand we don’t have to be defensive, but have to embrace this enabler to access undiscovered markets that we have to do business with on an eye-to-eye level.”
Jan Seffinga, Partner at Deloitte Switzerland, adds, “Some long-standing partners changed their opinion [about the blockchain] when they saw the opportunity. They may not understand everything in detail but they understand there is something behind this and they need to go forward. That’s really great.”
Marco Grossi, Director Audit and Risk Advisory at Deloitte Switzerland, points out one of the main tasks of established businesses in the digital future. He says, “We need to be much more technological. We need to understand how something is programmed so we can check if the programming is correct. This is a capability we have at the moment, but not in the way it’s necessary in the future.”
Alex Tapscott adds, “This affects every industry in the same way the Internet affected almost every industry or the steam engine created new industries. This is one of those big generational technology shifts that needs a concerted and focused response. Otherwise, you will miss the boat.”
Still, the blockchain poses questions. Jesse McWaters puts it this way: “We talk to all sorts of senior executives in financial services and often the say ‘We had smart people come in and explain how the blockchain works but I still just really don’t understand what it means for my business.’ The technology itself is less important. What matters to people is what they can do with the technology.”
At the same time, the technology is already making its mark. Elizabeth Stark, the Co-Founder and CEO of Lightning, says, “There is a huge amount of progress that has already been made. There’s something here. I find it hard to believe that I’m going to look back in ten or twenty years and say none of this ended up happening. We’re really seeing a new way of transacting value on the Internet.”
The Bank of One
Caitlin Long, the Chairman of the Board and President at Symbiont, sees drastic changes on the horizon for the financial services industry. She says, “It’s going to take a long time to weave [blockchain technology] into the current system, but I think within twenty years, financial services will be just software, and the smart contracts technology in particular is going to automate a lot of the things that institutions and people handle today.”
Dolfi Müller, the Mayor of the City of Zug in Switzerland, the first municipality in the world accepting bitcoins as a means of payment for its own services, has observed some resistance from the banking sector. He says, “We made different roundtables here in Zug after the start of our bitcoin experiment. We invited banks and bankers and tried to connect them with people and startups from the so-called Cryptovalley. They were talking, but the bankers were not so happy. For me, it’s a question of attitude. You can deny it or you can face it. We always said we have to face it because these things are coming if we want or not.”
Matthew Roszak puts it more directly: “There’s going to be a lot of disruption, a lot of revolution with respect to blockchain technologies. Banks don’t worry about other banks being competitors. What they worry about is the ‘bank of one’ the next generation of a banking network that’s resident on a phone, decentralized, distributed, based on a digital token that no bank or government controls. This creates opportunities not only for enterprises and governments but also for society.”
The human(e) future
Perianne Boring, the Founder and President of the Chamber of Digital Commerce, broaches the topic of financial inclusion. She says, “Seventy-four percent of the world’s population have no access to financial services, and in the United States, about fifty percent of the population have no access to financial services including bank accounts. There’s a huge amount of people around the world who don’t get to be a part of the global economy because they don’t have access to the financial system. This technology will lift a lot of people out of poverty, allowing more people to engage in global commerce.”
Eric Van der Kleij, the Founder of Adeptra, London Tech City, and Level39, says, “I don’t like to think that we’re creating so much prosperity for the less than one percent. I like to think of purpose-led businesses. The trick for large corporations is to understand that the cost efficiencies of embracing this new technology will widen their accessible markets at a cost that’s reasonable. This will create prosperity in different areas.”
Lars Thomsen, the Chief Futurist and Founder of Future Matters, says, “We will look at people and say: ’What are the things that I cannot do and where we can join forces?’ Much more than today, where we say ‘How big is your car and how much money do you have on your bank account?’ I believe the future will be even more human, or humane, than the last hundred years we have seen.”
The real revolution
The blockchain is certainly no solution for all the problems under the sun. Steve Wilson, Digital Identity Innovator and analyst at Constellation Research, says, “To be fair, the blockchain is nearly ten years old. I think it has another ten years to run before we really see its long-term impact. It’s going to be a long, steady journey we go down and we’re going to see multiple technologies inspired by this thing.”
The blockchain is a revolutionary invention, but it’s part of a bigger ongoing movement that includes all aspects of digital transformation. Roger Wattenhofer says, “Both ingredients of the blockchain—security and distributed systems have been around since the early seventies. The real revolution, or rather, the evolution, is that jobs will change. Computers will do a lot of the manual labor that we still see in service domains today.” Guido Rudolphi adds: “Everything will change. The possibilities are endless. It reminds me of the situation where all of a sudden we have two or three huge inventions happening in one moment.”
Affecting every human being
Taylor Gerring, Co-Founder of Ethereum
Rik Willard says, “People shouldn’t be living in squalor, fighting for a handful of rice every day. There is too much in the world to live like that anymore. This blockchain movement certainly is the technology part of that mindset, which exists offline as well. We have the wherewithal now to create technology that would help the entire human race. The question is: Will we do it? But we can do it now.”
Perianne Boring continues, “There is so much innovation that blockchain technology has spurred all throughout the world. I have absolutely no doubt in my mind that this technology is going to affect everybody. I would say in ten to twenty years this technology will impact the lives of every human being.”
Taylor Gerring, the Co-Founder of Ethereum, sums it up nicely: “It absolutely feels like a whole new paradigm for changing the world.” Indeed, it does. In the same way like when humans learned to fly.