State of Digital Money in Review
For those of you who weren’t at the State of Digital Money event on May 5th, here is a quick summary of what you missed. The event producers secured a top-notch lineup, from Jesse Lund of IBM Blockchain to Capital One’s Jim Kresge and Daniel Aranda of Ripple. The brain power they managed to pack under one roof still has my head spinning!
The event kicked off with Jesse Lund, Vice President of IBM Blockchain. Early in his presentation, Lund gave us a history lesson: Did you know President Andrew Jackson hated paper money? Jackson believed all currency should be coinage minted in precious metals. The reactions we’re hearing from many bankers today in response to cryptocurrency seem to mimic Jackson’s reaction to paper notes. The introduction of Bitcoin has spurred a revolution, extending far beyond the value of Bitcoin itself.
Before leaving the stage, Lund shared his predictions on what’s next for blockchain technology: “This new token economy is going to enable the digitization of all sorts of asset classes – the transfer of value and transfer of ownership of the asset will happen together in real time,” said Lund.
The conference was filled with thought provoking insights and discussions. Here are a few that stood out:
- Banks could not quickly adapt new technologies, even if they wanted to.
According to Richard Levin, Shareholder and Chair of the Fintech and Regulation Practice at Polsinelli, many banks, institutions and governments are still running on outdated “dino” systems from the 80’s. Even if the best fintech ever created walked through the door ready to go, banks couldn’t shovel out $3 billion at the drop of a hat – it’s an evolutionary process. Why? They have to answer to shareholders.
- There is no such thing as a wire transfer.
Ryan Singer, Co-Founder and CEO of Chia Network, walked us through the actual processes of a “wire transfer,” which equates to a series of debts and loans from financial institutions – and the fees on transfers increase with each additional institution involved in the transfer.
- The amount of energy consumed in crypto mining is hazardous to our environment and a solution is needed.
Singer also highlighted the negative environmental impact of crypto mining. In fact, during the event, I heard there are solutions that include mining stations near oil rigs and refineries to capture the energy that would otherwise go to waste. (AMAZING!)
- Blockchain can be used to solve – or at least reduce – corruption throughout the world.
John Mercurio, Deputy Global Chief Communications Officer of Bitfury Group, shifted our focus from payments to other applications of blockchain technology, most notably the potential smart contracts have to reduce corruption in healthcare and other key areas within countries dominated by fraud and distrust.
Stay tuned if you want to hear more about my experience at the State of Digital Money conference – including an overview on Vault Logic’s ATM, which I stumbled across between sessions!