Blockchain — a tale of two halves
Humanity is acquiring all the right technology for all the wrong reasons. — R. Buckminster Fuller (Inventor and Author)
This blockchain news summary looks at the latest developments;
- Bitcoin, cryptocurrencies and economic inclusion
- Artwork on the blockchain from a Marvel comic illustrator
- Central banking explorations of digital currencies
- UK HM Treasury cryptoasset promotions consultation
Bitcoin, cryptocurrencies and economic inclusion
In 2009, the world began what was undoubtedly one of the largest financial experiments with Bitcoin’s creation. A vision of a new economic future that is entirely digital with no central administration.
Some say, as no one really knows who invented it. That Bitcoin was to help greater financial inclusion. Forgetting, though, that not everyone has access to even their basic needs, let alone a computer or the internet.
3.5 billion people still don’t have access (to the internet), and on current trends, it will be past 2050 before they do.
Who can explain to a person who doesn’t use technology what a cryptocurrency is? What do you need to do to buy a cryptocurrency? Or how to use it to buy bread and milk in the real world?
Nothing yet seems inclusive. And more than ten years on, we have yet to see the mass adoption of cryptocurrencies.
Mass adoption
But, the technology behind the invention of Bitcoin that enables its secure public record-keeping is blockchain. It is blockchain technology qualities that are coming soon to allow the formation of new global marketplaces.
In ten or fifteen years, will we still call it blockchain?
During this sorting period in blockchain technology’s life-cycle, it is crucial to protect all citizens from bad actors. Protection is essential as we have seen the harm done in the recent Bitcoin Twitter scam hack.
It seems good timing for the UK HM Treasury to launch its cryptoassets consultation. This consultation will be running from July to October 2020. The study is researching cryptoasset classifications and promotions.
Some initial thoughts on ways to help protect people?
- Create new technology and business global coalitions
- Establish standard operational principles of blockchain use and cryptocurrency guidelines
- Comprehensive digital education for all
- Don’t use technical slang to sell solutions
Artwork on the blockchain from a Marvel comic illustrator
Since 2009, there has been a large volume of other types of cryptocurrencies and blockchain experiments besides Bitcoin. As well as creating new financial services, blockchain technology can provide the digital representation of physical assets through tokenization.
Digitally tokenizing tangible assets can benefit many areas of our marketplaces. Indeed, protecting an artist’s unique work or digitizing real estate paper deeds protects them from loss or misrepresentation of any building structure changes.
In recent news, comic book illustrator Jose Delbo of Marvel fame is releasing limited-edition art on a blockchain platform. Jose Delbo’s work will be on MakersPlace, a blockchain marketplace for rare and collectible digital art.
Central banking explorations of digital currencies
China’s central bank, the People’s Bank of China, took first player advantage in blockchain space. It was commencing its Central Bank Digital Currency experiments years ago. In this week’s news, The Central Bank of France announced trials in interbank settlements.
The lessons learned from these banking trials will contribute to a global study. The study will review the benefits of a Central Bank Digital Currency. These banking experiments help traditional financial services gain a greater understanding of using blockchain technology in their operations.
UK HM Treasury cryptoasset promotions consultation
On the 20 July 2020, HM Treasury issued two public consultations running to October 2020. The review asks for views on several problems, including the definition of the cryptoassets.
The goal is to strengthen the Financial Conduct Authority’s (FCA) powers to ensure the approval of financial promotions operates safely.
The Treasury is proposing to establish a cryptoasset regulatory framework. Any firm wishing to adopt these new financial promotions would need to obtain the FCA’s consent.
To be sure, this consultation is the Treasury’s response to protecting consumers of new technologies. These new financial products give direct access to services that are not only new but complex and confusing.
The Economic Secretary to the Treasury & City Minister, John Glen commented on the announced consultations:
“It’s important that people can understand the financial products they see promoted. If adverts by unauthorized firms are misleading or don’t fully outline the risks, then people can end up losing money. That’s why we want to put more protections in place around such financial promotions, including the promotion of crypto-assets while continuing to ensure people have access to a wide range of products on the market.”
The Treasury is explaining that due to the nature and quantity of these new financial products offered. The government believes existing safeguards are insufficient to protect citizens.
Earlier this year, the FCA issued a report noting that cryptoasset firms or virtual asset service providers needed to become regulatory compliant.
In summary, blockchain has a few years to go before this new technology safely goes mainstream.
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Stay safe folks!
Emily @BlockhchainScout
