Blockchain is the future. However, we are only at the beginning and new ideas are constantly being developed, which makes right now the perfect moment for social entrepreneurs to use blockchain to change people’s lives for the better. We interviewed Iñigo Molero, a blockchain expert and co‑founder of EthicHub.
Blockchain is like a “database” or a general accounting ledger that allows all participants to be absolutely certain that registered transactions really did take place and are not false, thanks to mathematics and cryptography.
Blockchain could kick start an industrial internet revolution.
The internet has impressed us all. It has changed the way we socialise, the way we work. Imagine what we could achieve if it turned into something even better, if the internet of information transformed into the internet of value. Blockchain makes it possible to transfer value via the internet, which opens up a world of possibilities, creating opportunities we cannot yet imagine.
To date, a higher amount of money has been invested in blockchain than was invested in the internet when it was at the same stage of development.
When the internet was starting out, the first visionaries began developing search engines and email to bring order to the chaos. From there, the internet developed into what we know it as today. I think we are at that same stage now – we are developing projects that will turn the internet into the internet of value.
The difference between the internet of information and the internet of value lies in the protocols. A protocol is a set of rules that all users in a chain of peer-to-peer blocks must comply with to create a blockchain. For example, the Bitcoin protocol establishes that there will never be more than 21 million Bitcoins.
The number of Bitcoins issued is defined, unlike the US dollar ($) or the euro (€), for which we do not know the amount issued.
A protocol can also define other things, such as whether the network is decentralised, whether it is a peer-to-peer network, or whether it is an open network, where everyone can see the registered transactions.
One such protocol is the TCP protocol, which is used by all of today’s biggest organisations, such as Google and Amazon. It is this protocol that these successes are based upon, but it does not get the credit it deserves. The protocols are always the same and this applies to blockchain too. The value of blockchain technology partly lies in these protocols that define how the technology works. There will be high value initiatives out there that are simply based on the Bitcoin or Ethereum protocols or any other similar protocol.
Imagine it would have been possible to buy shares in something called the internet in the year 1994. This is similar, except now it is blockchain.
We must first think about the origins of blockchain and understand what blockchain was initially intended for, as it has now become an industry worth tens of billions of dollars.
Blockchain and Bitcoin go hand in hand. They were launched on 3 January 2009 as a peer-to-peer payment model. Bitcoin is open source, meaning that anybody can take the Bitcoin code, adapt it and make money with it.
Combining brilliant inventions such as public key cryptography, Merkel trees and sophisticated prime factorisation algorithms to create what we now know as blockchain is Satoshi Nakamoto’s greatest gift to humanity. More and more people became interested in blockchain and they started thinking of new ways it could be used. No longer just a tool for transferring money, its use extended to protecting anonymity along with other things. Nowadays, we know that blockchain can be used in many ways in various industries.
At that point growth took off and a huge variety of businesses now use Blokchain to create value. Public blockchains, such as Bitcoin or Ethereum, allow anyone to participate, but there are also private blockchains, which use DLTs or permissioned networks. As the name suggests, not everyone can participate in these.
Out of everything that is going on in the global ecosystem, this is the most interesting topic. I often collaborate with Blockchain España, a platform that organises meetings and puts on talks and courses. We are convinced that the Spanish speaking world must take advantage of this opportunity. What makes me slightly angry is that, right now, only the smartest countries are positioning themselves to attract the talent and investment.
Everyone knows by now that the big industries of the future will use blockchain and supporting projects that generate wealth and jobs should be a priority.
So we must wait and see what legislation is introduced. At this point in time, blockchain is simply being treated like any other investment, meaning any money an investor makes, such as the 15% returns that EthicHub offers, is taxed as if it had been made on the stock market or any other financial market.
In my opinion, believing whatever a lawyer tells you today about blockchain would be a mistake, because even if the lawyer means well, nobody knows what is going to happen. However, in future, when the industry has developed further and business is thriving, it seems unlikely that authorities will impose restrictive regulations that would have a retroactive effect on things that are going well. There is a community out there that is willing to talk about at least matching the conditions that the most advanced economies are offering.
I find it really fascinating that right now, as blockchain is still relatively new, we can actually watch the technology develop. When blockchain does finally reach a wider audience, growth in the industry will be exponential. However, right now we are lucky enough to be able to follow what is going on and – why not? – maybe even develop a project ourselves.
Blockchain promises transparency, which is why it can help all social businesses focusing on the triple bottom line or the circular economy.
This opens up a whole new world of possibilities for how to generate positive impact as a business or as a user of blockchain. Social businesses can develop new business models in which all stakeholders benefit and users can demand improved traceability of products consumed.
I think that the first important step is to take an interest in blockchain. Go to talks, get to know the ecosystem. Then it’s time to innovate. Listen, learn and believe in your own ideas instead of allowing others to impose theirs on you. After all, blockchain is a very new technology, so there are no experts. Others may be experienced activists at most.
This is a great time to start learning what blockchain is.
I participated in the book Blockchain: la revolución industrial de internet (‘Blockchain: the industrial internet revolution’), which is one of the few books worldwide that is written in Spanish and that seeks to break the barriers of entry into the worlds of blockchain in Latin America and Spain, where there is a lot of talent and creative imagination, which is all a social entrepreneur needs to develop a project.
The book also mentions examples of how blockchain is currently being applied in different industries, such as in finance, insurance and among NGOs. Entering into the world of blockchain also makes your previous professional experience more valuable. Another thing individuals can do is sign up for a blockchain meetup, as this is an excellent way to meet and connect with others and to develop your ideas.
What makes blockchain so interesting is that you do not need to be an expert in anything; you simply need to be able to think laterally. Blockchain will be difficult to understand if you focus only on economics or on programming.
Blockchain technology is perfect for generating a positive impact.
Now is the time to experiment. Many companies and projects that exist today will not survive, but those that do will change the future and I sincerely hope they will be social businesses. I think it is worth giving it a go, as blockchain has the potential to make our world more inclusive and to bring about the systemic change that is needed.
