Lau: Absolutely. You know, it’s a Chinese saying — it’s either a curse or blessing. May you live in interesting times and absolutely, that’s where we are right now. One thing we’ve noted about Covid, while most people are sheltering in place, technology has not stayed in place. Not one bit. What are the initiatives right now that you see in blockchain as a result of, or even because of Covid?
Boring: Yeah, actually, there’s another Chinese saying that I think is very apropos for this current moment. That was actually a quote from President Kennedy and he said, “the Chinese use two brush strokes to write the word ‘crisis’ where one brush stroke stands for danger, and the other stands for opportunities.” So in a crisis, be aware of the danger, but recognize the opportunity. And I think that’s really emblematic of how the pandemic is impacting the blockchain community.
So in my role as the president of the Chamber of Digital Commerce, ever since this pandemic started, I’ve reached out and spoken with dozens of CEOs of different companies in this space to just understand how their business is being impacted. And there’s a couple of themes there that I’ve picked up on. And one of the ones I think is super encouraging is how Covid-19 is highlighting some of the key blockchain use cases.
We’re seeing a lot of increased interest in things like supply chain, or other areas of what I would call digital critical infrastructure. So while the whole world is sheltering in place and working from home and we’re all relying on these digital systems much more for every day life, but also for business, these systems are being tested and more people are really understanding how important digital infrastructure is, and that digital infrastructure really is critical infrastructure. And I think there’s a huge opportunity for the blockchain community.
We’re seeing a lot of interest from many different government officials that see that as well. And also, given how radical of a moment in history this is, I think a lot of people who aren’t always open to new technological ideas are now more open to something as forward thinking as blockchain technology, because they’re seeing things that they never expected to fail or fall apart. They never expected that to happen. And they’re more open to new ideas. So in a way, I think there’s ways to accelerate the adoption curve, especially across the enterprise. And I’m getting a lot of positive feedback from companies that agree with that.
Lau: And so a lot of our audience is a new audience as well. Absolutely right to affirm your point that there is an increasing awareness to embrace and to understand technology more. And so for those who are joining this space, trying to understand this space, recognizing that some sort of digital transformation, technology-driven innovation must be implemented right now to address current day problems and potentially in the future — what should their thinking be? How should they go about trying to understand the technology, or their best practices to really educate, to self-educate and then to also assess and apply?
Boring: I’m glad you asked those questions. We ask ourselves that a lot, too. And in our role at the Chamber, we spend a lot of time educating the government. And one of the bodies that’s been a challenge for us to really help kind of close that education gap is the Congress. And I’ve spent a lot of time thinking about this, and it turns out most members of Congress in the United States don’t have a technology background.
A lot of them either have been in public service most of their life or a lot of them are lawyers. There’s only about 9% of members of Congress today that have any type of technology degree or formal education or background. And it’s also older generations and those people that serve in Congress. The average age is in their 50s, 60s or 70s. So a lot of times it is to younger generations that blockchain and digital assets come a little bit more naturally. So one of the things that we’re actually working on right now with members of Congress specifically is giving them the opportunity to touch the technology, to experience it, to have the opportunity to actually use blockchain and real life.
The way we’re looking at doing that is just through bitcoin. Bitcoin was the first blockchain. It is open source so it is free for anybody to use. So one of the things we’re putting together is actually giving members of Congress and their campaigns a small amount of bitcoin, and then showing them charities that accept it and letting them actually open up a wallet and send a transaction to a charity. And for so many people who have received their first bitcoin are excited about that space. That moment when you send your first bitcoin transaction; a lot of times, that’s that ‘aha’ moment for us, where you understand how powerful it is to be able to send something of value and appear to pay it your way, in a digital way, in a very seamless way.
So just to get started, I actually encourage people to get a little bit of bitcoin, you don’t have to buy it. You can buy a dollar’s worth, you can buy ten dollars worth. Send it to a charity, send it to a friend, and just experience sending a transaction. And I bet that’s a really great way to just learn through their own experience. And from there, you can start working on more complicated and more advanced applications. But to get started, seek a friend and you can reach out to us, and we’d be happy to show you how to do that. I think that’s an interesting place to start, is by touching it and getting to send and receive it.
Lau: And just overcoming that first hurdle of intimidation. Just to actually just start learning. Just start diving in. Just start listening to podcasts like this. Start reading and self-educating. I think one of the key things about innovation right now is that it often comes at a time of need. The pandemic is putting a lot of stress on global supply chains.
Right now, we’re seeing the use of digital ledgers to track the efficacy of even some of the medical devices coming out of China to the rest of the world. Then there’s also this enormous stimulus action from not only the United States, but around the world. We are hearing mentions of the digital dollar in the U.S. to provide stimulus to Americans. How valid is this idea right now? Is it just borrowing a term without having the actual infrastructure of digital dollar and blockchain behind this concept in Congress? What’s happening there?
Boring: Yes, let me demystify this for you, because this was all over the news, but everything was happening so fast that I think there were some misconceptions that were reported on in the media. So one of the bills that brought us all the stimulus funds in response to Covid-19 was called the Carers Act. And in early drafts of what became the Carers Act there was a section that included a digital dollar in using what they’re calling a digital dollar to send stimulus funds. And that provision ended up being completely deleted. So that was not passed. That was not implemented into law. But it was in one of the drafts of the bill. So that created a lot of excitement.
If you actually look at that language with a fine tooth comb, it was not a digital dollar. I think what you and I would think of a digital dollar on a blockchain. It would just be a digital form of fiat. So for one it shows that there is a greater interest in Congress for a digital dollar. It also shows there’s an evolution of thinking towards better digital infrastructure for our financial system in the United States. But there is no vehicle right now to implement that for any of the stimulus bills. So the idea that there’s going to be a digital dollar for stimulus funds this year, that’s very unlikely.
But the thinking and the interest is growing in a really phenomenal way. So we’ve been looking at the digital dollar initiatives for a very long time. And, as you know, Christopher Giancarlo, who heads the digital dollar project, is on our advisory board at the Chamber. And at the very beginning of this year, we really did not expect the interest to be as high as where it is right now. We really thought we would spend the entire year just trying to get people educated and kind of up to speed. And we’ve surpassed all of our expectations in terms of the interest from government. So we do feel very good. We do see a lot of positive development in the thinking of us, but there still is quite a long way to go.
Lau: How much is China really driving this interest? We’re monitoring the development of their digital currency, their central bank, back to digital currency, trying to set up an alternative system. And it’s very interesting to watch that unfold in China.
How much awareness, and this is part of what we discussed last time, which was between China and the U.S. in terms of if this is a race, and there’s no doubt in many minds that it is — how much awareness does the U.S. and in Congress have on developments in China and how much is that stoking interest?
Boring: There is a huge interest in Washington today on China. And that has even sped up due to issues around the pandemic. So there is even a coalition of members of Congress that have really come together to lead discussions on how to address the issues the U.S. feels it has with China. And some of that is quite hostile and negative. I certainly wish it wasn’t. I don’t believe having these tensions between the two world’s largest economies is a good thing. But there is a lot of concern from Washington about many different things in China. And there’s many members of Congress that are very interested in that.
So China’s work, prolific work in blockchain technology and in the DCEP is just one part of their overall strategy. I will say that has been a very powerful message as we’re trying to help educate government officials in the United States about the importance of this technology when we’re able to demonstrate and show what other major economies are doing in this space. It really does elevate the conversation to a whole new level.
So we really don’t want the U.S. and China to be in competition with one another when it comes to adopting this technology in different ways. But to see other economies that are new, building out prolific blockchain strategies certainly is helpful and demonstrating its value to other government officials in the United States that maybe haven’t had the opportunity to learn about blockchain in a deeper setting, or who are just new to this technology.
Lau: From the government level back down to enterprise with Covid really kind of being a common denominator of experience for across all industries, how does the blockchain industry compare right now vs. others? Are they in a class of their own or are they equally being subsumed by Covid? What are the conversations you’re having there?
Boring: So for some of the enterprises that we’re working with, we are seeing a maturation of blockchain integrations within the enterprise. And so when we started this journey many years ago, you would see an enterprise start a blockchain team or a blockchain division within the organization that was responsible for figuring out the blockchain strategy for that particular company.
Now, we’ve seen companies who have spent several years doing that. They’ve done lots of proof of concept. They’ve joined consortiums, they fund consortiums that have customers, that have clients and blockchain is being integrated across their entire business. It’s not really a separate part of the business anymore. And so I think that, again, shows the maturation of the industry in this technology across the enterprise. And so it’s not something that’s separate, or a separate team or a separate function. It’s now really a part of the business and a part of their regular offerings, especially when it comes to anything cloud-related. So that’s one thing that I’ve seen.
Another theme that I have seen is for companies; large companies, including major financial institutions. One of the things that they have said is today with a pandemic, their innovation teams are actually growing because they have been able to demonstrate the value of investing in innovation. That value proposition is resonating with their leaders more today. And it’s really helped grow innovation initiatives in the enterprise, particularly in financial services. And those teams are expanding during this time. So I would see that as another key indicator for this space.
Lau: Well, there’s no doubt these conversations are going to be also picked up by your virtual conference that’s coming up. I know that the last time we talked, we were going to personally meet in D.C. for the blockchain conference that you were leading. And now in a Covid and going into a post-Covid world, this is just the new normal.
These are the conversations that you’re going to be having there. I wonder as well, what are the top conversations you think are gonna be the most important, that you’re going to be covering in your virtual conference, but also ones that we need to pay attention to into 2020 and 2021?
Boring: Yeah. So, as you alluded to, we postponed our in-person conference back in March due to the pandemic. And we have built a virtual event series called Parallel, which we have just recently announced. It is a series of seven virtual events. So we will be bringing the industry together once a month for 90 minutes segments and interactive segments, and we’re gonna be covering many different themes across the blockchain ecosystem.
So everywhere we look across the blockchain industry, we see an old world and a new world that is running in parallel. Whether that’s established financial systems that are being reimagined by fintech or decentralized finance, or seeing analogue systems that are being digitized or seeing new technologies that are being retrofitted into decades old regulatory frameworks, we see all of these as necessary as we lean into the next phase of adoption.
The Parallel virtual event series will explore these fundamental transformations that are happening across the blockchain ecosystem. As the technology approaches and thinking and beliefs begin to merge and combine and even at times collide.
Lau: Collide is absolutely what we’re experiencing right now. I’m noting that you’ve been in this space since July 2014 when you launched the Chamber of Digital Commerce. You’ve been involved in the blockchain policy space for quite some time. Since then to now, what do you think is the biggest change you’ve marked here, either in the public policy space, the industry space, just in the past, even half a decade? What have you tracked here that is most notable for you? And where do you think we’re going from here?
Boring: Yeah, I think there’s been some really important conversations that we’ve helped spearhead that have really changed the tone towards blockchain and digital assets. There is a lot of fear and anxiety and skepticism, especially around cryptocurrencies, because there’s been all sorts of funny things. People I’ve seen in the media and a lot of people still today who just think bitcoin and cryptocurrencies are solely used to buy illegal drugs online. Believe it or not, people still think that.
As we have really been able to demonstrate with the regulators, blockchain technology is a powerful force for tracking and tracing transactions. So when we first started, there was a lot of pushback from regulators because they had anxiety over the anti-money laundering risk of crypto. And where we are today, where we’ve been able to unite the industry to work with global regulators on ensuring that we have protections in place to protect the financial system from that type of abuse, we’ve really done a complete 180 on that conversation where today we have the head of (here in the US) FinCEN, Ken Blanco, who has even acknowledged that this is a very powerful technology and has a lot of positive benefits for the financial system, and has also fought for regulators.
So that education piece is so key, especially when it comes to public policy. And it takes time for people to really get across that education gap on something that’s so technical. And what we have found is that when people actually take the time to learn how this technology works, many times they will come out of that experience as a big champion for our space.
We’re in the business of winning champions for the blockchain ecosystem, and we have a strong collection of them today. We’re looking to continue to expand our supporters throughout government and with law enforcement specifically, that’s been one area where we’ve cleared up a lot of misconceptions and it’s gone a long way to help aid the adoption of this technology in a responsible way.
Lau: Well, there’s one thing we believe at Forkast, which is that knowledge empowers. And certainly the silver lining of this time that we all have sheltering in place is that what we do with this time, with knowledge and information and understanding should empower us to lean into a future that may be murky, but is absolutely in our hands to create right now.
And Perianne, I want to thank you so much for sharing your ideas and your observations as to what’s happening in this space. And I look forward to these continued conversations that you’re going to be sharing virtually. I think there are important themes to track.
Boring: Absolutely. Well, thanks for having me, Angie. It’s great to catch up and look forward to being back here with you again soon.
Lau: Absolutely. And everyone else who’s listening in on this Word on the Block episode. Want to thank you for joining us here. I’m Angie Lau, Editor-in-Chief of Forkast.News. Until the next time.
