Understanding Why This Infrastructure Has the Power to Transform

Sid Shah, Senior Principal at BCG Digital Ventures, expands on the blockchain conversation from L.A.’s The Upfront Summit.

Blockchain is an extremely popular topic and is poised to be the hot tech for moving money in 2016. The subject is popping up at tech conferences globally such as the World Economic Forum in Davos last month, where my colleague Mike Schwartz participated in the future of commerce session titled “The blockchain: tackling global poverty and reinventing finance.”

Last week, Brock Pierce from Blockchain Capital and Micah Winkelspecht from Gem hosted a well-attended panel at The Upfront Summit about their thoughts on blockchain. The session included everyone from hardcore investors and start-ups to people who genuinely wanted to learn about blockchain technology and find out where it’s all going.

It was really interesting to hear Brock speak, as he is so well known in the bitcoin industry and has seen it evolve into what it has become today. Here are some of the key points he raised:

  • We’re in the very early stages of blockchain. Early investments in blockchain are the roads, tunnels and pipes (infrastructure) needed for the eventual democratization of money, much like TCP/IP was for the Internet.
  • Look beyond the U.S. to see the potential. To really understand blockchain’s potential, we need to look where there isn’t solid regulation or protection of people’s money and assets. For example, the Middle East, South and Central America and parts of Southeast Asia are areas where usage is extremely spikey. The reason banks exist is to create an institution of trust. For that, you pay large fees (forex, trades, savings, etc.) for whatever financial products you use. Imagine a place where you could carry out the same transactions and with the same amount of trust for little to zero fees. This is one of the potential benefits of blockchain technology. It is also the reason why it’s feared.

One thing that was clear from the session is that there is heavy investment from venture capitalists into blockchain technology, and this is only going to increase in the coming year. Although there is still a ways to go, it is one area to watch. We can be sure to see true game-changing innovation here in the future.

BCG Digital Ventures invents, launches, and scales industry-disrupting new businesses with the world’s most influential companies.

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