How blockchain enables technology to flourish and improve resilience

This episode of “Better Innovation,” Global Tax Innovation Leader and host Jeff Saviano interviews Sandra Ro, CEO of the Global Blockchain Business Council, and one Jeff’s favorite collaborators in the innovative technology community.

Jeff Saviano

Hey. Better innovation, It's Jeff. We are picking up the pace season for another interview in the books. In our theme of resilience building coming out of the pandemic. Today we have Sandra Ro in our studio. Sandra is one of my favorite people in the innovative technology community. She's the CEO of the Global Blockchain Business Council. The GBBC serves the blockchain community by fostering education and building bridges across the many stakeholders, all to help reach the full potential of blockchain.
What I love about Sandra's message is this recognition that in order to truly scale blockchain, you get to address issues other than just the software development, issues like governance data privacy, government regulation and increasingly the new geopolitical landscape, all for the technology to truly flourish. If you've got an interest in blockchain, this is a must listen. Sandra is such a positive force in the blockchain community.
Something I don't ask for enough. Please give us some feedback on the show. You can find me on LinkedIn. Also on Twitter. We'd love to hear from you. Enjoy the show.
Sandra, welcome to the show.

Sandra Ro

Thanks, Jeff. Great to be here.

Saviano

I have to say, some people have bucketlist of things like visiting new places in the world or maybe engaging in some kind of new activity. One of the items on my bucket list was to interview my blockchain guru, Sandra Ro. I'm so excited for today.

Ro

Oh, wow Jeff, I don't know quite what to say to that other than thank you. And it's a great pleasure.
My favorite topic, something, you know, you and I both have been working on for a number of years, but from different angles. And I really think we're going to have a great talk.

Saviano

Yeah, I do, too. And so now I can rest.
I can rest. I can check the box on one of those bucket list items. And we have, you and I have had such great conversations about blockchain and distributed systems and more broadly, technology and where the world is going. We are in crazy times, aren't we? And it's so interesting to have this conversation today as we record this in January 2021.

Ro

Absolutely. I think we are all obviously experiencing a very collective, unfortunate crisis but I think with respect to the blockchain community and industry, the pivot has actually accelerated a lot of the conversations we've been having. And, you know, there was a bit of even last year, a bit of wait and see, maybe certain things will develop.
And if anything, we've seen the acceleration of the digital economy and the digitization of pretty much everything.

Saviano

We really have. And now with some, we'll talk a bit later about the intersection of politics and lawmaking and governance. And it's not just the bits and bytes of technology but there are many other factors that have to be in place to really get the benefit.
You know, Sandra, I think you're in such a unique position, given your leadership role at GBBC at the very center of blockchain development and these efforts to scale the technology all around the world. We're going to unpack that a lot today. Well, we'll talk so much about that technology. But before we jump right in, I thought we could start by looking at how more traditional technology is developed today and what's wrong with that.
Why do we feel like there's a need for change? And before we jump to the change, let's talk about where we are today.

Ro

You know, I wish I could say that our systems and the way we treat data today, because ultimately what we're talking about is just loads and loads of data out there. We've got them, unfortunately, siloed.
They're sitting in either companies, they're sitting in various segments in government. They're sitting in lots of different places. And even though everyone talks about the cloud, it's sitting in the cloud. But actually, when you deep dive into where data pools are, they're often sitting actually siloed within companies and organizations. And when we need to share that information, we actually come up against a lot of frictions.
And we've seen that actually in the pandemic. And we talk a little bit about that with respect to health care. But let's face it, it's every industry and it's every segment of, you know, pretty much every segment of our lives, even our identity.

Saviano

So problems in sharing data, sharing information, verifying transactions and comparing records of data from one system to the other.
I've heard you referred to this problem as a traditional castle and moat strategy. What do you mean by that?

Ro

So I use that analogy to describe the way people used to and countries used to do battle. Right. They would fortify themselves with these big walls and then they would create a moat and they would sit there waiting for the attack.
And I use this analogy a lot when it comes to data security, because I feel like most companies and most organizations are taking the exact same approach, which is let's sit there with our honeypot of data and let's wait to be hacked. Let's wait and sure up as much as we can. But effectively, you're waiting for the attack.
When I look at and think about the way decentralized systems work, I think actually you know, we need to rethink the way we're treating data, especially the way we're securing it, the way we're storing it, who's holding it, how it's being done and that's why I use that analogy.

Saviano

I love one of our collaborators who, you know, Sandy Pentland at MIT referred to this problem and point out that the data is only as secure as that ports door that you leave open in the back of your house.
I always love that because no matter how safe and secure you think it is and the primary ways in which a cybercriminal may access that data, they're finding new porch doors open. Yes. In the back of the house.

Ro

Absolutely. And that's a vulnerability that most organizations have accepted as something they just the risk they need to deal with, which I'm not saying is wrong.
But I think if we look at different models, perhaps it's not a risk we need to assume has to be taken into account. Maybe there's different ways to protect or to shore up our data.

Saviano

So, sticking with the current technology as it exists today, lots of examples of building tech on a one to one basis, one developer builds it for one organization, could be a company, could be nonprofit, could be an individual to solve their problems.
And, you know, hence there's the independent honeypot of data. But we live in a network society, don't we? And transactions that are occurring across those networks. That's what these distributed systems we're finding are better at managing those transactions than the traditional way.

Ro

Absolutely. And in a world where collaboration and information sharing is critical. It doesn't take away from the fact that you still want to keep information confidential.
You still want to keep information secure. But we do find increasingly we have to collaborate in this networked world. How do we do that in a manner that allows you Jeff to keep your IP and your data, but allows me to maybe verify a piece of information that you have related to a transaction I'd like to do with a third party and do it in a way that's efficient and secure?
And I think that's where distributed systems and decentralized networks are really taking form and frankly may be the better model to operate in the future.

Saviano

And this is such a special time of again, January 2021 and we have had cracks in the armor, right? This past year. There have been cracks that that have exposed systems, exposed organizations. What have you seen over the past year of those exposures that that tell you that it's time for a new approach?

Ro

Absolutely. There is not only the technical challenges, there's also the cultural challenges we'll have to cross in order to get this to work, but let's just take the health care pandemic and information flow to citizens for example. You know, I sat in New York for most of the crisis, believe it or not, in New York City itself. And, you know, New York City went through quite a big wave of challenges, especially in the early sort of March, April, May timeframe.
And I learned something interesting. The hospitals work on different networks. They're actually siloed, public versus private. None of these hospitals actually share information in a readily available way. And this has been done by design. And it was a huge challenge for the government and I mean the Government of New York to actually assess the information very quickly without, you know, this collaboration among all of these hospitals.
And it took a while. It took too long, it's good now, but it took way too long to get the information that people needed to gather to make the policy decisions.

Saviano

So as that information was slow to come in, then policymakers will be delayed in their decision making.
They may not be making the best decisions because they don't have the right data.
So there's a timing issue. There is substance and quality of the data issue. But even before the pandemic, we felt that as patients and as citizens relying upon the health care system, the data is not available from one doctor to the next. You go to a specialist in New York City, and then you go to your general doctor in Westchester County and you can't get data shared readily.
What's exciting now, and maybe this is this is a good bridge to what's happening in the world. You look at governments like Estonia that have used blockchain in particular to centrally manage health records and what I should say, manage them on distributed systems and use this new technology to better and improve the citizen experience. And that's what gets us so excited.
So, I think you're right, Sandra. The big idea is that distributed systems may be better to address these issues. And blockchain in particular has been a recurring topic on this show. Why do you think distributed systems will be so powerful?

Ro

Absolutely. I agree with you wholeheartedly, Jeff. It is the future because one prompted by the need for the information sharing that is right now friction filled and frankly causing delays and potentially costing lives and delivery of vital services.
But it's beyond that. It's actually you know, not just about the interchange of information, but as data becomes of value. And I think this is the crux of what we're going to see in the next decade. You know, when you think about as we move value around as easily as we move information in the form of email, when I can send to you because I owe you ten bucks, easily as email and it costs you basically nothing, that data as value is going to be incredibly important.
And it opens up all kinds of not only financial services to those who are actually left out of today's financial services network, but actually what I think is even more important is the ability for government to deliver on some of these services that are just so costly right now in a more effective manner.

Saviano

Better information, better data, better decisions, and just as some of the statistics that I've seen for how effective are blockchain, for example, a blockchain system can be on, you know, just the opportunity to verify transactions and how much time is wasted when things go well.
But let's face it, people make mistakes and there's, you know, business is problems. And when those problems happen to verify transactions in a complex ecosystem, just take a supply chain, for example, still, here we are - 2021. And how do we do that? We do that with transactions and phone calls and the back and forth to resolve issues across ERP systems based on how multiple parties recorded it, takes an enormous amount of time, doesn't it?

Ro

Absolutely. And supply chain is a massive topic, which of course has generated a number of use cases where blockchain is being utilized today. And the next question becomes, well, all these use cases across different industries. When does it actually scale where it's going to be used across an entire country or entire industry? It's coming.

Saviano

And building for networks, it's coming. it's not easy. They're building and we're going to get into some of the barriers that we're all facing who are in this world. But building for one customer cannot be as easy as building for many, of course, can be a challenge. It is really interesting, though, isn't it, that just from a data security standpoint, that it may actually be counterintuitive to many. I would suspect, Sandra, many of our listeners may feel that it's counterintuitive to manage data across a distributed system, then putting a padlock on the data. Explain that. Explain why that may be a counterintuitive statement.

Ro

I'll give you an example from financial services only because I come from that background, and it's the easiest thing for me to relay. When I think about working at a large market infrastructure and then I also worked at a bank. There is a tremendous amount of financial transactions, especially trading transactions which are recorded and held. And these are incredibly highly regulated entities. And so the bank or the market infrastructure is on the hook if anything goes wrong by the regulator, right? They're going to be the ones who are paying the fine.

Saviano

High stakes.

Ro

The mentality. Exactly. It's high stakes. So the mentality of I must secure it. We as an organization are responsible for this set of data is a natural reaction. When you're regulated and you're held accountable.

Saviano

And there are legal standards, right? The lawyers would say the lawyers would say that you have to follow the norms or and if you don't, then then perhaps that's not reasonable care for how you are protecting your data. And to some extent, the lawyers will drive what that reasonable care is.

Ro

Absolutely. And then when you think about you take those set of parameters and then what often organizations do is they'll actually make it even more robust. So they'll take that same data. They will secure it, but they will also make it redundant. So they'll have it sit in multiple different locations. It's the same data. It's just replicated because everyone needs a backup.
And when you multiply this out across industries and I did work on this when I was in the financial services space, we looked at how much data replication there actually is that is completely unnecessary, but it's in place because each individual organization has come up with their own way of dealing with plus plus.
So it's regulation; plus plus.

Saviano

It would very frequently be, and we see this all the time that it means multiple servers. It means, as you said, redundancy, but it also means that people want versions on their laptops, they want to control it, they want to be able to access it, and some feel better if they have a local version.
And so what happens then, you know, you've got many, many people that have the data on their personal machines that are on subways and other places. And that's part of the risk, isn't it?

Ro

Absolutely. So, as we understand why we all do it, rationally speaking, it actually introduces yet more risk into the system and I think we all need to take a very sober look at how we are really looking at data, the fact that we replicate it so many times over and we allow that to happen, what solutions do we need to come up with that either mitigate the risk or frankly, do we need new models altogether to rethink the way we're doing this?

Saviano

It is interesting, too, because you went to the replication and you could also give an example of just multiple transfers of the data into a data lakes. Right. And it's hard to find a company today that isn't using a data lakes for perceived greater efficiencies, but everybody understands or most understand it. Every time you transfer the data, there's certain risks that happen upon a transfer and maybe the future of data management doesn't mean that you necessarily have to manage everything in one place.

Ro

Absolutely. And the concept you just mentioned around data lakes, I've heard data oceans, I've heard data ponds. But the point being is could we treat data as a utility as well?
Meaning is it possible to have data pools and pull these pieces of data together in a manner that still allows for the confidentiality that certain organizations want, but then allows for more Real-Time Access to that information. And we're definitely hearing about this in regulation tech on how can regulators actually be part of a network that allows them to see into real time data.
And then you build applications on top that will make it easier for the regulator to pull the right pieces of information. It's not like you're going to give them the big pool, and there's no application to help them navigate that. But the idea being, can you bring the regulator in, in a manner that makes all parties happy?
And I think this is where the dynamic risk management topic becomes very interesting.

Saviano

I've heard that referred to as a super fluidity. Did I get that right? Super fluidity of your data? So, you could in this situation, whether it's a regulator or in my world, in the tax world, where there are some countries like Brazil and Mexico that do this today, they will have a hands in your financial statements to extract the data that they need to compute how much your tax liability is. I think I mentioned to Sandra some of the work that I'm starting to do with New America and how excited we are about the work of that organization. And I've been really interested in distributed ledger technology in the form of a digital public good. And I'm so interested to know if you think that this could be a viable channel to better promote blockchain adoption around the world and what are the roles of especially again, I keep coming back to where we sit today. How important do you think digital public goods are to help scale blockchain?

Ro

Absolutely. I think it's one of the most interesting areas because when I think about who can scale any technology, who can scale large corporations and government. Yeah. And when I think about government adopting this for the good of citizens, you know, it's the example that you gave on Estonia. Estonia is already doing it. Their population is a few million people. And so a few million people are benefiting from P2P energy trading or the ability to access voting partially on a blockchain or to have their identities digitally available to them in their power. Yeah, these are all, you know, really amazing services that Estonia has put into place because they made a conscious decision over a decade or so ago to do this. The U.S. is a much bigger infrastructure in a country, but that doesn't mean that the U.S. can do it. It would just need real focus and a real purposeful intention to upgrade.

Saviano

And by its nature, a digital public good doesn't always have to be this way. But relying upon open source software model and the public nature of a digital public good introduces a notion of sharing that good with other, here in the context could be other nations.
It could be many other stakeholders to take advantage of it. So that's what's so interesting to me about it. But there's clear gaps in the world for governance models and finance models. But let's face it, to truly proliferate this technology, we need to get it in people's hands. And introducing it as a digital public good. Perhaps that's where the hand of government can be helpful in these scaling models.

Ro

I absolutely agree with you. And, you know, I think you touched upon the beginning. We're going to start talking a little bit about the geopolitical landscape. I think it's already started. So what do I mean by that? Well, we talk to lots of different governments around the world about blockchain, mainly from an education standpoint. But we often hear about their plans for how they are approaching the technology. And so let me start with China. China has already announced their BSN network, which is effectively internally a blockchain based solution for many different areas that they'll be looking at, including a digital renminbi. But then I go to India and they're looking at digital identity, which they've already put on their system one point, what, three, four or five billion people in their population.
They're the largest digital identity solution in the world. However, it's not on a blockchain and they are actually looking at that as to whether they migrate from this database solution that they've got to a blockchain based solution. Why? Because they're also looking at whether they could deliver possibly mobile based voting applications that could utilize distributed ledger technology as well for those who are in very, very remote locations.
So again, these are very specific use cases, but you're seeing some very large countries thinking about this mass scale.

Saviano

It also highlights the fact that that perhaps this is where there's a Western bias that some in the Western world feel like, well, of course, the solution has to come from someplace in the Western world to develop the global standards. But, you know, as you follow initiatives like the Belt and Road Initiative from China and as you mentioned, BSN and a digital fiat currency and the implications that that would have on monetary authorities around the world, I think finally and this advice to our Better Innovation audience is you can't ignore the East and absolutely in this space can't ignore what China is doing.
We'll talk a bit about some of what's happening, it's so exciting, in the U.S. I want to make sure that we just touch on that. There are barriers that are still in place, that if it was easy right then blockchain would be a well adopted general purpose technology. Many different consortiums and groups and organizations would be using it but let's face it, there's lots of ghosts that are lurking around the corner.
Let's just do a quick run through these parade of horribles of what some perceive blockchain represents. Tell us how you feel about how the blockchain community is overcoming this. Okay, so we'll go really fast. I'll just thrown out and let's, let's just talk for a minute about what's happening. First one is that the existing protocol, some would say, are having a hard time scaling.
Scaling has been a real issue in the community. How do you feel about that? Where do we stand on overcoming that obstacle?

Ro

I think there are a number of DLT and blockchain solutions which are absolutely overcoming that issue. And technology is developing every single day. So I'm not concerned about that at all actually.

Saviano

And the cost of transactions is coming down, the time to process the transaction has been coming down.
And that's been comforting to me too. You could see the reduction of the time it takes to run transactions and can actually achieve some more of that scale. So okay, so far, so good. You're not jumping off the cliff.

Ro

No, not yet.

Saviano

You're in good shape. What about data privacy and security? You know, that may not be robust enough. Some you know, we hear this, too, from our clients that there's a concern about these secure systems.

Ro

So when I think about Etherium, for example, it's a very public blockchain it's open to everyone. Absolutely. You probably don't want to do private transactions yet on that blockchain. However, then you had a group of people come together and launch a derivative of that blockchain, which is known as Quorum, and that one specifically addresses confidential information and financial transactions. So, when you have a problem I find that lots of smart people tend to get together and solve for those problems.

Saviano

And what a great example of innovation, right? The mother of necessity. And that's the great example Okay. Is another one. When many people think of blockchain, they think of Bitcoin. And, you know, Bitcoin has been associated with some shady transactions and the underbelly of the world.
What do you say about that association that some people may have?

Ro

So, I have two things to say about Bitcoin. Number one, we should all be grateful for Bitcoin's existence. It is literally the Genesis blockchain and technology that has kicked off everything else that we are talking about. Jeff, you and I would not be working on DLT and blockchain solutions if it were not for the Genesis blockchain.

Saviano

Somebody had to start it.

Ro

Somebody had somebody to do it. Absolutely.

Saviano

And we all benefit from it.

Ro

And it's the first use case. It was a P2P cash electronic payment network, and that is it's you know, initial purpose. And frankly, it's evolved. But the second thing I want to say about Bitcoin is, yes, there are elements when you're talking about using any network for moving around value, people will take advantage of that.
Absolutely. And that needs to be stamped out without question.

Saviano

Any other barriers that you see significant other than the ones that we've talked about. Anything that really does give you some concern.

Ro

We still have bad actors in the space. I'll be very frank with you. We do a lot of vetting because it is a global technology and it attracts lots of different people from all over the world, which is a plus. I love the fact that it attracts people from all over the world. However, it also attracts a very small minority of bad actors and people who want to take advantage. And this is where guardrails need to come in whether it's consumer protection or whether it's protecting companies from, you know, rogue elements or actors. This is where, you know, we spend a lot of our time is finding high quality technologists, high quality organizations who want to work together.
And we need to filter, it’s the reality of the way this technology is developing. That. And that's actually what worries me the most, is when irreputable organizations or companies have the ear of government. That concerns me a lot.

Saviano

Actually, we see some of this with extreme interest around the world for digital fiat currencies. And if you really look behind the current to understand why nations are so interested in it, that there's a control element, isn't there, that they're worried that there are so many transactions that are occurring on systems that they just as the government, they don't really see.
And as I can tell you from a tax perspective, if you don't know what it is, you can't tax it. So, there's certainly loss tax revenue there. But you think that's one of the motivating factors behind digital fiat currency push, is this control opportunity?

Ro

I would imagine that's a partial issue, but I think it's also a natural evolution. I've been in the space now for, what, eight plus years, feels like a lot longer in certain days. But you know, Bank of England, many of the central banks actually were researching years and years ago on digital fiat currency and so even though it's now making headlines, the banks themselves have had research teams looking at the space for a very long time.
And they were doing it quietly in the background. So this is actually not new. They knew this was a natural progression of digitization. The question is, when does it make sense for a government to actually launch their own digital currency and for what reason? Because CBDCs are not all the same.

Saviano

I appreciate you talking about these obstacles with us and for our audience to hear, because I do think it's an important discussion that we see it in our work that it's so interesting that there are many preconceived notions about blockchain.
I think the more dialog we can have like this open, transparent discussions about these are the barriers that are in many cases perceived. But what we love about this community is the innovation to find new ways around it. We've said a few times that we think this is a watershed moment in human history, really, to adopt these distributed systems.
Why now do you think that this is blockchain's moment?

Ro

There are probably a number of different reasons. I'll give you my version of why now, having come from the financial services industry, we've had a number of financial fat tail events, as they call them. They're only supposed to happen once a century, but frankly, seems to happen every seven to ten years. And I think that's a worrisome systemic issue, is perhaps we need to reorganize the way we look at certain parts of our world. And I think that reorganization is coupled with the tech convergence that we're seeing. Tech is accelerating like, you know, I think there's really amazing graphs of how long the Internet took to be adopted and now how long the latest technologies are being and the times being compressed every year into months now.
So when we think about the convergence of digitization with some of these crises that we've had and frankly, I think a shift towards data as value is a big deal because we're also pushing up against what is money who controls money and what does that mean?

Saviano

And you think that the pandemic has been an accelerant because of the difficulties that many governments have had, could be for example, they didn't have the pipes in place to push our stimulus or as we're seeing now, massive supply chain problems in pushing out vaccinations, do you think that the pandemic will slow it down or do you think it actually may speed it up?

Ro

Well, we've all been separated and we're all online all the time. I have to say as much as I appreciate being able to interact with you all online, I would much rather do it in person in a room. But we can't right now. So what do we do? We all go online, which means the digital economy has exploded, whereas we've got brick and mortars that are failing and going bankrupt left and right. We have two very different worlds going on and I think it's only exacerbated because of the pandemic. The digital world is exploding. The kids and I'm going to say kids because a lot of them are kids.
The kids who are like trading around on decentralized finance or creating tokens and gaming. I mean, all of these different areas are exploding and they're turning into multibillion dollar industries overnight, it seems. And yet we have brick and mortar. We have supply chains like physical things, just breaking down. And I think what's going to be really interesting is as we come out of this, how much of digital will impact the physical and how much does the physical actually need to mesh with what's going on the digital world? And I think this is going to be a very opportunity filled, but also very painful process.

Saviano

The proverbial last mile problem of the connection of the physical world to the digital world. And you've also you said it earlier, Sandra, in this this discussion that the geopolitical issues, the complexity of how fast moving these issues are for regulators and how they have to deal with not only the regulation of new innovative technology but perhaps also is there an opportunity to introduce incentive mechanisms?
Right. You know, let's not look at regulation only, but what about I suppose this is the carrot, right, of finding incentive mechanisms. So actually people can use it. I think, for example, one of the positive government effects and I've always felt that helped the Internet was when President Clinton signed the bill to not tax the internet for some period of time, Internet Tax Freedom Act to get passed in 1996. And that was environment within the US to let this new technology flourish. So I hope that there is more that the government can do. Let's stick with this this issue of government and regulation. We've had just an amazing few weeks with our inauguration just happening this week as we record this interview today. Do you think that the change in administration in the U.S. may help accelerate the scale of blockchain? Are you excited about this new administration?

Ro

We really hope so. And we've been having a number of conversations with different agencies within the U.S. government at the federal level. And we are heartened by they listen. They are, I think, have a number of challenges. But we've also indicated that digital infrastructure is just as important as physical infrastructure on the agenda.
And frankly, with countries like China and India coming out and even Xi Jinping came out publicly saying that blockchain and AI are there major priorities. We need the U.S. government to set the tone to lead. Private sector will do its thing. It will always innovate.

Saviano

Yeah.

Ro

But we need the government to step up. And that's what really we've been pushing for is take a look at the landscape, do the homework, we'll help you with the research, will provide, you know, information.
We need the decision makers and the legislators to really understand that the U.S. needs a cohesive digital infrastructure outlook.

Saviano

And you mentioned the importance within the U.S., of course, and I totally agree I could even extend it one step beyond the U.S., some would say obligation to the rest of the world and the world. Democracies of the role that the U.S. could play to accelerate adoption and the leadership across the globe. And we are excited about that. I can tell you I was just over the moon when we saw the appointment for example, at the time, President elect Biden nominating Eric Lander with ties to MIT and Harvard to be his science advisor, the director of OSTP, Office of Science and Technology Policy. And as if that wasn't enough to raise it to a cabinet level position was so thrilling for us in the science and technology world to see that, I thought that really sent a message to the world that this administration will take it seriously.
What do you think about that move?

Ro

You are absolutely correct to mention that elevating that to a cabinet position sent the right message. Science matters. Facts matter, technology matters. Now, what I think needs to happen is we need as many decision makers at federal level government to be educated on at least the broad stroke issues related to technology and emerging technologies like blockchain.
Why? Because it is literally permeating through every industry and every part of our lives. It is a requirement, not an option to know about this.

Saviano

Strong signal, it's a strong signal from governments even. And that was the signal in these very, very early days of the new administration. And we see it, too. You look around the different, as you mentioned, federal governmental agencies, the teams that are innovating with this technology and how that will help societies will be so incredible to watch. And then we can only see what happens in the states. And they were also excited to see I love the Supreme Court decision. My favorite quotes ‘the states as laboratories of democracy. And you'll see innovation happening across to 50 states that may actually move faster than the federal government.’
We've already seen some experimental action there. Let's stick with some other signals that may be visible that tell us that, you know, blockchain may be a really big deal in the short term. The price of Bitcoin has reached an all-time high. How much of the growth from in the valuation of Bitcoin do you think may be attributable to the promise of blockchain as the underlying technology?
And that's a question that I've been dying to talk to you about because it's hard to avoid. The run up has been just staggering. Especially those in our audience that are sitting on some Bitcoin. It is a staggering amount, but is there a link there? Do you think that there's a signal there that tells us that perhaps we're going to see this advance?

Ro

Look, I think the people who got into Bitcoin back in the early days got into it because it was a cool technology and it was a technology for the first time that solved the double spend problem, which means I can't cheat you by spending the same money twice in a network. And that was amazing. And to me, when I found out about it, I bought Bitcoin because I was amazed by that technology.
Now, fast forward to today, unfortunately, based on what I see on crypto, Twitter and a lot of the sort of talking heads on TV, people are not enamored by the technology, they're enamored by the thought of Bitcoin as a store of value, as an alternate digital gold, as it were, in a world where, let's face it, there are lots of buy side firms that are looking for alpha and need diversification.
And the world looks pretty bleak when you've got governments printing and debt loads growing, you know, seemingly exponentially. So Bitcoin as an alternative really becomes that investment vehicle. We'll probably continue to see that as we see the more we see crisis, we'll probably see a spike in interest in Bitcoin.

Saviano

It's an alternative. And just as we see spikes in, you know, people investing in gold, for example, and to your earlier point, the more that we see the proliferation of digital fiat currencies and there could be alternatives and other stablecoins, and that may also affect the price we really love about the global blockchain community is that there's a recognition of the power of many and the recognition of the need for this collaboration to achieve the breakthroughs that everybody's looking for. Just a few weeks ago, we had Sheila Warren from World Economic Forum was on the show, and I love how she referred to this community. As she said, blockchain was, quote, ‘a team sport’. Do you think she has that right?

Ro

Absolutely. I think she and I run around the world saying the exact same thing. I quote her off it on that. And I know a number of other blockchain colleagues who say the same. It is a collaborative, interactive team sport. you cannot be the actor that sits there and says, I built it, now you come. Culturally, that does not work well in blockchain.

Saviano

It doesn’t work well. I love our relationship with the GBBC and do such great work for the community.
Tell us a bit about what your mission is at GBBC to promote blockchain.

Ro

Well, as a Swiss based nonprofit, spend a lot of our time working with governments and some of the largest fortune 500 out there around just unpacking and distilling away from the noise and the hype. So, it's education, it's advocacy and it is about partnership. We want to help build the business of blockchain and proliferate and help those who are trying to build and solve problems. So we're very pragmatic. We're bridge building institute meaning we bring lots of different stakeholders together. And Jeff, you mentioned it already, but that's one of the beauties of this technology that keeps me going. Frankly, it's the motivation which is you have so many bright minds from academia, the legal field, government, private sector, all walks of life who have a singular mission to either solve a specific group of problems using technology and or they're trying to improve an existing system using this technology and it really is lots of people pitching in really kind of a beautiful thing.

Saviano

What's the one problem that you see? And you sit in such a unique seat, Sandra that you see so many different applications across your membership and you see it from governments, so you're from the private sector. Is there one particular problem set that you're most passionate about that you think blockchain could really make a material difference in the world?

Ro

That's a very tough question. Just because we see so many use cases around the world. If I'm going to give you the short answer, I will tell you the problems that we are most interested in, at least I am most interested in as well personally, are the ones where we solve for actual human problem. So meaning whether that is trying to help people gain more financial options I'm going to call it options as opposed to just access.
It's really important. So whether it's a digital wallet or whether it's a bank account, I don't personally really care. But the question is, can we do it in a way that is fairer, creates a more equitable way of allowing that set of options, giving people more options whether it's also helping women and girls with their identity in certain countries where even today having a digital identity that you could hold as your own to prove actually means a lot and it's life changing for certain people. It doesn't sound like much to us because we all have our own driver's licenses and passports and forms of identification that we rely on. But in other countries, that is not the case when we're trying to tackle things that are really sort of at the basics. Land registry is another one. Some people, their families are robbed of their land because the government just takes it away because there's no proof that they actually have held that land for generations or a company takes it away from them. These are real problems in these countries.

Saviano

These are vulnerable communities. These are vulnerable people and societies. And I would agree, that's where blockchain is so exciting to see, for example, the alignment to the Sustainable Development Goals and how this technology adopted as a true general purpose, technology could actually help save the planet and improving communities.

Ro

Absolutely. And I don't think it's a pie in the sky thing to say
People are working on for example, this is a very practical solution which is the Tokenisation of Carbon Credits. Carbon credits came into play decades ago and they just never took off because the demand side supply side just really were out of whack. But now for the first time, we're beginning to see not only buy side but sell side, come together and figure out how do we verify, that when you say that you've actually have these carbon credits and you've now sold them to me, that they're not sold again to somebody else and that they're actually true and that they're actually issued properly, the sort of issuance verification tracking, tracing all the things that blockchain can do. We can now use the carbon credit market.

Saviano

These two sided markets, and we've seen this over the years with credits at the state level that are transferable, could be a film credit, could be an investment credit that the transferability is important to promote the marketability of the credit and to entice the ultimate investment which was aligned to the policies of the government.
These are great features of here and we're talking about credit mechanisms. But unless you have a platform where to bring together buyers and sellers, then it's like vapor that floats away in the wind, isn't it?

Ro

Absolutely. And, you know, I'm going to bring in another topic that's never considered, you know, all that exciting, but it's critical, which are standards where we decide to all work on the same network.
We're really going to also have to be thoughtful about global standards for how we're going to operate. You know, you mentioned Sheila Warren at World Economic Forum. We actually teamed up with the WEF last year to launch the Global Standards Mapping Initiative we called GSMI for that very purpose, which is to map where we were in terms of blockchain on the technical, legal and regulatory side.
And we found actually some really eye-opening things, which is, well, a lot of work has been done. It's incredibly disparate. And we need to actually synthesize a lot of this as a community. And there's a lot more work to be done, but it's happening.

Saviano

It was needed by the world. We appreciate it. I'm also I have to say, I'm excited to work with Sandra, with you at GBBC and others to look at it for taxation. And we believe that blockchain will be transformational to tax and fiscal systems across the public and private sector. Isn't that when you surveyed interested parties, that tax came out relatively close to the top in terms of field that's ripe for blockchain applications, so I'm personally really looking forward to doing more with you on that.

Ro

I have to tell you, I am always amazed by how much the topic of taxation comes up, probably because it affects all of our lives. And if it's made easier, it's probably going to be appreciated by everyone. But consistently we find in the blockchain space creating more efficient solutions for taxation, not just for the benefit of the citizen, but also for government as well.
It goes both ways. If we can create a better system, we could actually help both sides out and that's a win-win.

Saviano

That's well said. It is a win-win, organizations and individuals government. Totally agree. Sandra, we're coming towards the ends of our time today, and we like to end the show with some rapid fire questions at the end.
This is a staple, a Better Innovation we do face questions and fast answers.
Okay. What do you say? You up for it?

Ro

I will do my best.

Saviano

All right, here we go. First question, what books you have on your nightstand? Oh, I actually have five books at any given time on my nightstand, but I will name one that I just could look at right now, sort of toppling over.

Ro

So, you know, I'm one of those people stability is has five different books going on at the same time, which is not always the most efficient, but it's me. I've got Evicted. It's a book about the U.S. eviction system and how broken our housing markets are. Oh, so interesting is that new? It’s in a couple of years ago, I believe it's won a number of awards.
It's called Evicted Simple as that.

Saviano

Excellent. Great. Okay. I have to take a look. I get all my great book tips from our wonderful guests, Better Innovation.
Tell us about a historical figure that you admire.

Ro

You know, I don't have too many heroes in life, but one I've had since I was a child. And also because I grew up in and around Philadelphia, Benjamin Franklin, the Renaissance man approach really appeals to me. I think I'm a Renaissance woman in many ways. I like to dabble in lots of different topics. And activities. So as a figure, a historical figure, you know, he did a lot for not only the United States of America, but he was an inventor, an artist. He did lots of different things.

Saviano

A true renaissance man is also a connection to where I live.
I live next to a town called Franklin in Massachusetts, and he actually opens first public library. I believe in the country there. And it's always fun every so often to go check out the books that he loaned to the library. So great choice.

Ro

That's amazing, Great!

Saviano

Okay, last question, Sandra, what do you see as a greatest opportunity to build back stronger when we finally emerge from this pandemic?

Ro

I'm spending a great deal of time where government meets health care. I think that is our single greatest opportunity. We will have more pandemics. There will be more crises coming. We've got to do this better.

Saviano

We do. And we've learned so much, so much what not to do. But how do we build resilience? Resiliency is going to become so important.
I want to thank you, Sandra, not only for coming on the show today, but for your contribution in this wonderful world of blockchain and how important it is. And we look across our clients at EY and the work that we're doing in this space, and we know that it will be transformational. It takes organizations like GBBC to step up and to be leaders in the world.
And so thank you. A personal thank you for that and thank you for coming on the show. It is, so like I'm checking the box. My bucket list is a little bit lighter today. Now that you've been on the show. So thank you so much for coming on today.

Ro

Well, Jeff, I want to thank you and the team for the opportunity. It's been delightful. And frankly, we covered a lot of topics today. They're important ones. And I think we have a unique opportunity, each one of us, to make a difference. I think we all need to work together. So really appreciate that. And in the near future, I will be turning the tables on you, Jeff, and I hope we'll be able to interview you very soon.

Saviano

No, I can't wait. Great. We'll do it. Thank you so much.

Ro

We'll find a GBBC opportunity soon. Thanks, Jeff.

Saviano

Looking forward to it. I'll talk to you soon.

Presenters

Jeffrey Saviano

EY Global Emerging Technology Strategy & Governance Leader

Podcast

Episode 3

Duration

49m 48s

EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.

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How blockchain enables technology to flourish and improve resilience

Presenters

Jeffrey Saviano