One of the common themes that ran through the political discussions at the Blockchain Africa 2019 Conference was that there is an absence of political trust and wide-spread adoption of blockchain in governance. There is a shift moving from private and central systems to more public, anonymous, decentralized networks in a bid to maintain safety and security over financial assets and data and in order to keep up we need to look to technology to make important changes.
Nezaam Joseph at the Blockchain Africa Conference
Nezaam Joseph, the chief economist in the Western Cape Government, briefly spoke about the benefits of blockchain-based tender by commented on the state of banks at present. He said that there is no guarantee that the big banks will succeed and if they fail, there is no one that can bail them out. Owing to this, there has been an erosion of trust, whereby we have come to trust decentralized systems such as Air BNB and Uber, but have little trust in governed systems.
Closing, he remarked that the “value [of blockchain] outweighs the risks”.
Marcus Swanepoel at the Blockchain Africa Conference
Marcus Swanepoel, the co-founder and CEO of cryptocurrency exchange Luno, remarked that money is being lost in the system. When it comes to centralized systems, there is a portion which goes untracked and disappears into the system, which no tracing of its whereabouts.
He noted, however, that when it comes to money based on the internet – such as Bitcoin – the money doesn’t go missing; it goes to the consumers. We no longer need to rely on paid systems to transport messages across the world because free and cheap services such as Skype and IM have replaced postal fees. In these cases, a small sliver of the funds might go to the company, but the majority of assets remains with society.
Swanepoel followed this by saying that the political systems need to be on board with this ideology otherwise blockchain-based currencies become difficult to fathom. He offered that a common currency will “probably come from a grassroots level” remarking that Bitcoin offers this since it is “open, neutral, auditable, trustless, secure, versatile.”
He also stated that while benefits arise, there are also risks to consider:
“Nefarious, volatility, resources to mine, scaling, regulation and education.” Fortunately, if we look at the case studies, these are being mitigated as technology evolves:
“There is transparency, data and tools; stablecoins; Segwit, lightning; self-regulation, visibility; consumer information and press. These mitigations have only been five years in the making.”