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Will Blockchain Become the Foundation of Digital Trust?

No longer just a speculative technology, blockchain is gradually gaining adoption.
Wendy Glavin is Founder and CEO of Wendy Glavin Agency, a NYC full-service public relations, marketing and social media agency. Wendy is a 30-year veteran of corporate, agency and consulting. She specializes in B2B2C marketing communications, PR, social and digital media. Contact her at: [email protected].
Wendy Glavin is Founder and CEO of Wendy Glavin Agency, a NYC full-service public relations, marketing and social media agency. Wendy is a 30-year veteran of corporate, agency and consulting. She specializes in B2B2C marketing communications, PR, social and digital media. Contact her at: [email protected].


During the month of May, many of us attended summits, conferences, events, pitch fests and parties. There were in-depth discussions about blockchain, digital assets, the Internet of Value, digital securities, decentralized finance, regulations in the crypto ecosystem, trends in FinTech and AI, data privacy and the importance of building digital trust.

While Gartner predicts that blockchain will result in $176 billion in added business value by 2025, blockchain technology is complex and difficult to put into practice. Key highlights from Gartner’s Reflection on Consensus 2019, a cryptocurrency industry conference in New York, were:

  • Blockchain is still in its early phases and isn’t enterprise-ready.
  • Organizations need to determine its suitability.
  • U.S. regulators are cracking down on anti-money laundering cryptocurrency-related entities.
  • Security tokens may hold promise.

During the last few years, blockchain has been discussed in numerous trade articles, reports and conferences. No longer a speculative technology, blockchain’s core features are:

  • Both tangible and intangible assets can be recorded, encrypted and distributed across thousands of computers worldwide to ensure the data is secure.
  • The network verifies transactions through cryptography and digital signatures.
  • There are no intermediaries, such as a banks or governments.
  • Bitcoin (BTC) is the most widely known cryptocurrency. Other highly ranked cryptocurrencies are EOS, Ether (ETH), XRP and Litecoin (LTC).
  • Data stored in the blockchain is made secure and immutable using cryptography. Every block is referenced by a unique string of characters, generated by a cryptographic hash function.
  • Data recorded in blockchain is further made secure by using private/public pairs of digital keys to maintain relative anonymity.

If you invest in or trade crypto, are a blockchain startup or company, or work in these industry sectors, these descriptions are quite basic. It’s likely that you read and follow major trade publications like Blockchain Magazine, Bitcoin Magazine, 21CRYTOS, CoinDesk, and CrytoDaily which lean towards emphasizing the benefits of a decentralized network, open source, Ethereum 2.0, Bitcoin, other cryptocurrencies, investing strategies, apps, wallets, exchanges, versatility, automation, anonymity and many other blockchain uses.

Still far from a viable currency

In stark contrast, Bloomberg authors explain that few are using the world’s largest cryptocurrency for anything beyond speculation. Research from United States-based blockchain intelligence firm Chainalysis indicates that only 1.3% of economic transactions for bitcoin came from merchants in the first four months of 2019.

Bitcoin needs the hype to attract mass appeal to be considered a viable electronic alternative to money, but it has developed a culture of “hodlers” who advocate accumulation rather than spending.

CNN added to Bloomberg’s analysis: What bitcoin hodlers know — or think they know — is that bitcoin is “good money” while dollars are “bad.” That’s not necessarily because they just like bitcoin, or don’t like dollars, or just happen to be inveterate contrarians.

It’s because banks designed the U.S. monetary system for dollars to lose an average of 3% of their value every year as the Federal Reserve that issues them steadily expands the money supply. The Fed gives newly issued dollars to Federal Reserve banks (like Bank of America or JP Morgan Chase) to lend at a profit. When they begin to circulate, they drive down the value of every dollar in your bank account.

Overall, concerns about cybersecurity, regulatory and compliance issues, trust, the scalability problem with bitcoin, market fit, asset tokenization, digitally encrypting asset titles, licenses and other rights to tokens are barriers to institutional adoption.

On a more positive note, Peter Brandt, best-selling author and well recognized technical analyst, has said that following the unexpected 12 percent drop of bitcoin on May 31, he has become more comfortable with the trend of the asset as it demonstrates stability.

Galaxy Digital CEO Mike Novogratz said that the perception of bitcoin in the past several years by the public and the broader investor base has drastically changed. Initially, investors were skeptical of the survivability and sustainability of the momentum of bitcoin in the long-term.

Fast forward ten years of operation with barely any downtime supported by an active open source developer community, a robust mining industry, and millions of users, Novogratz noted that investors are becoming more confident in the future of crypto.

The advancing progression of digital ledger technology (DLT) and blockchain-based cryptographic tokens gives rise to new business models in various industries and fosters the global trend of economic and social decentralization — which will be accompanied by an increasing tokenization of assets.

Switching to consumer and business uses, blockchain enables the transaction of both tangible assets, like land, stocks and bonds, machinery, vehicles, equipment, art and buildings, and intangible assets like intellectual property, patents, legal agreements, company goodwill and more.


Termed tokenization of assets, issuing a blockchain or security token represents the digitization of a tradeable asset. Using smart contracts, transactions are automated with fewer intermediaries which speeds up the process, has an immutable record of ownership, offers transparency and broader accessibility.

One of the biggest breakthroughs the blockchain would provide is an immediate and convenient way to distribute the ownership of complex assets, like businesses. Ownership is an important concept in a thriving economy, giving people the chance to grow their wealth by buying and holding assets, Nasdaq explains.

Asset tokenization will also simplify how exchanges and transactions play out, giving consumers more options for both straightforward purchases and transfers of ownership. Tokens also have the ability to revolutionize creators of intangible or hard-to-define assets, like photos, music, and other creative works.

The National Law Review echoes Nasdaq’s point. “There are infinite possibilities for creators and artists [of] any caliber with respect to the future of blockchain technology. By employing a system that links the data associated with their work to other pieces of information from its inception, artists using blockchain can potentially protect their intellectual property from cybertheft.”

Trust in a digital era

Scott Likens, New Services and Emerging Technology Leader at PwC, believes that blockchain is set to be a foundational technology for maintaining trust in the digital era. As he points out: “When dealing with suppliers or counterparties or clients, it can be transformative to know that paperwork, products, payments — even people — are all as they should be. You can then do more with partners and customers and automate more of your transactions with them.

Also, by using a blockchain or distributed ledger as a kind of connective tissue between different decentralized data stores, things can get interesting. Maybe it’s decentralized document signing within your organization, or across your own sub-legal entities. The point is that there are so many things you can then do without needing to get together 20 different banks, say, around a table with a bunch of lawyers before deciding that you can start a development process.”

In 2016, Don Tapscott, co-author of “Blockchain Revolution: How the Technology Behind Bitcoin and Other Cryptocurrencies is Changing” believes the technology underpinning the cryptocurrency could revolutionize the world economy by offering privacy protection and a platform of trust. “We have this great asset of data that’s been created by us, and yet we don’t get to keep it. It’s owned by a handful of powerful companies and governments. They monetize that data or, in the case of governments, use it to spy on us, and our privacy is undermined.”

In the Internet of Things with billions of connected devices users provide massive amounts of personal data. Blockchain’s promise is to enable users to decide what data they’re willing to share, with whom and for what context. Data privacy proponents are advocating for blockchain laws to govern people’s ability to own their data in U.S. states and abroad.

Regulations evolving to catch up with innovation

A huge victory was made in the state of Wyoming with the recent passage of 13 blockchain laws, most notably a bill recognizing digital assets as property. More than a dozen other states have followed suit including Montana and Florida as the most recent states to pass bills in favor of crypto assets.

Globally, crypto assets have garnered attention from regulatory authorities, including those with authority over secondary markets and the trading platforms that facilitate the secondary trading of crypto assets (Crypto-Asset Trading Platforms or CTPs).

As such, the International Organization of Securities Commissions (IOSCO), whose membership regulates more than 95 percent of the world’s securities in more than 115 jurisdictions, published a consultation paper, “Issues, Risks and Regulatory Considerations Relating to Crypto-Asset Trading Platforms” to obtain feedback on issues, risks and other security considerations for CTPs by July 29, 2019.

While it’s possible to buy top cryptocurrencies like bitcoin (BTC) and ether (ETH) in the over-the-counter (OTC) market, most people will need an exchange in order to buy other altcoins. Exchanges are simply an important component of the system that makes the crypto market tick.

Regulators want to be sure that exchanges employ the best security practices as well as measures — Know Your Customer (KYC), Anti-Money Laundering (AML), and Combating the Financing of Terrorism (CFT), for instance — that discourage illicit transactions and improve account and wallet security.

Caitlin Long, 22-year Wall Street veteran and co-founder of Wyoming Blockchain Coalition, was responsible for the recent ground-breaking cryto-friendly legislation in her native Wyoming. Often called upon as the FinTech pundit to read the tea leaves of the SEC, Long was named in Consensus 2019: 100 Most Influential People in Crypto. I encourage you to read about these key leaders and follow their insights to stay abreast of emerging trends.

“Regulatory ambiguity is both a cause and effect of the meteoric rise of this parallel financial system.”

Long’s recent Forbes article outlines the latest issues, challenges, and opportunities. Here’s an overview:

  • How is private industry using blockchain-based systems to track food provenance and supply chains?
  • Why is blockchain’s promise of creating identity slow to be adopted?
  • What states are employing or considering blockchain adoption?
  • Legacy financial institutions vs. the blockchain financial industry
  • What are the concerns surrounding Financial Action Task Force’s (FATF) “Interpretive Note”?
  • What regulatory body should oversee cryptoassets?
  • Are digital collectables personal assets or securities?
  • How does the Howey Test apply?

On June 5 2019, government and industry leaders are gathering for the annual non-profit ACT-IAC Emerging Technology Forum in Washington, DC with state, federal and international leaders to discuss blockchain technology, government adoption and regulation of the private sector’s use of it.

If you’re a business trying to determine whether blockchain is right for your company, Salesforce provides six key questions:

  • Do you want to solve a business problem, rather than an integration problem? Blockchain is at times mistakenly positioned as an integration technology, but that’s not a core strength.
  • Does your business process require inherent irreversibility? This quality is foundational to blockchain, so ask yourself whether it would help you achieve your business objective or hinder it.
  • Do you want to transfer objects of value from one party or entity to another? If this is the case, consider whether what you intend to do will benefit from immutability. Also, does it require consensus?
  • Do you want to transfer information across organizational boundaries?
  • Do you want to target an ecosystem, rather than a few parties? Consider whether the problem you want to solve requires (significantly) more than two participants.
  • Do you have a clear strategy for engaging and driving adoption with partners? Without their adoption of blockchain, the positive impact to your business will be limited.

If you need a primer on the history of blockchain, please read, “How Blockchain Can Rebuild Digital Trust.”

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