How governments can embrace solutions already at their shores to hasten economic recovery from the COVID-19 pandemic
By Marc Taverner, Executive Director of INATBA
Silicon Valley is, in its own right, one of the world’s most powerful places. There are entire generations that have been shaped by Facebook, Google, Uber, Netflix, and many more. These are more than companies. They are paradigm-breakers that forever changed how most of us live our lives. And they came out of Silicon Valley, a place where talent and technology thrived in an environment of discovery and innovation.
Silicon Valley is indeed unique, but I believe its model is absolutely replicable. Even better, it could be replicated for the good of an entire country, not just for a shareholder’s bottom line, if an effort is made on a country-wide scale.
We could see the rise of “Silicon Countries,” where governments were as equal partners in innovation as the companies and universities headquartered within their borders.
New applications of technology could be discovered in these places, developed and applied near-instantly, with easily accessible guidance and oversight from the civic experts that lead our institutions. These countries could run international recruitment programs with streamlined visas that attract and retain talent for technology experts. They could integrate technology education into public service requirements, dedicate resources to retraining programs, and make technology education available to citizens of every age.
While this sounds incredibly grand, what it mostly requires is a mindset shift by our elected representatives. In the case of many technologies, all of these opportunities, experts, programs, and resources are already there. They just operate in a silo separate from governments.
With a few notable exceptions, this is the case in the blockchain ecosystem. Even in its infancy, blockchain had the potential to build a decentralised world. No matter where you stood, you could participate in the global economy, sell your house, prove your identity, and more. It promised to make systems more secure, more efficient, and — best of all — remove the need for slow and potentially corrupt centralized depots. Since its inception, blockchain has grown to a behemoth technology, spawning new solutions every day for inclusive finance, better global trade, unshakeable identity, improved supply chains, and more.
However, most of this innovation has come out of the corporations and start-ups who brought the technology knowledge in-house to launch these use cases.
Similarly, universities and trade associations have led educational programs and research efforts to bring this technology to more people. What more significant impact could these efforts have had if they had the government’s endorsement and resources?
We have some idea. Several blockchain projects excelled because they located themselves in these government “sandboxes” where regulations were relaxed and experimentation was encouraged. These frameworks for growth further attracted innovators to their shores. For example, South Korea’s regulatory sandbox created 380 blockchain-related jobs and more than $110 million in new investments.
Another standout initiative is the European Central Bank’s (ECB) renowned focus on a central bank digital currency (CBDC). Through its open consultation program, as well as its own scholarship and research on the opportunities and challenges of a digital euro, the ECB is driving more innovation on a European central bank digital currency than we’ve seen across the entire continent in the last decade since the invention of bitcoin.
Other countries have taken the initiative to encourage blockchain on an even wider scale — such as Australia’s publication of its national blockchain roadmap, encompassing several initiatives across regulation, standards, skills training/education, research funding and development, investment programs, and more.
These are all big picture strategies that can be applied on a country or continental scale.
A country-wide “sandbox,” paired with smart recruitment programs, in-depth research and informed policy development, and in-country educational programs, could see astounding levels of job and value creation. And this is because governments are uniquely positioned to drive forward innovation in ways that even the largest multinational corporations cannot. They have unparalleled access to experts from their countries that can bring technology education to every school and citizen. They are home to industry bodies such as INATBA and other trade associations that are creating research and policy recommendations every day; and they can launch initiatives like sandboxes, investment funds, and permissive regulations that make innovation financially viable for companies and inventors. Tied together, governments can harness a vast swatch of invention and create unprecedented value for their citizens. And there is no better time than now, as the drive to digitisation has never been more accelerated than in the wake of the COVID-19 pandemic.
Blockchain can help deliver significant and steep change in this critical period. The innovation is there. There are dozens of pressing use cases. The desire for adoption is unparalleled by citizens and companies who want better systems. Governments can leverage all of these assets for more robust economies and improved education for their citizens — which begets resiliency for all types of crises.
Marc Taverner is the executive director of the International Association for Trusted Blockchain Applications (inatba.org), the pre-eminent nonprofit organization supporting the growth of DLT & blockchain technologies. Launched by the European Commission during its 2018 European Blockchain Roundtable, INATBA is the leading convener in the global blockchain ecosystem, offering developers, companies, and users of blockchain/distributed ledger technology a forum to interact with regulators and policymakers and bring blockchain technology to its next stage. To learn more, visit inatba.org.