Unblocking Tremendous Value
Blockchain technology and its application on various industries is the way forward. Su Aziz chats with an expert who applies it to a way to invest in mangroves protection. This article was first published in the second issue of WIEF In Focus magazine.
Here’s a thought: How would an expert explain blockchain to a 5-year old?
‘Blockchain is a global network of computers that connects everyone on earth. It empowers anyone to have their own wallet to hold many different kinds of coins and to safely send these coins to anywhere on earth,’ replies Alan Laubsch, an entrepreneur and blockchain strategist with Lykke.blue and, the fairly new, Blufolio AG.
Now, for the grownups: ‘Blockchain is the next generation of the internet. It enables the Internet of Value which is far greater than the Internet of Information. Blockchain also powers decentralised applications. It’s the most significant innovation of our time, and we’re likely to see the greatest value creation in history, in the coming decade,’ Alan says. Basically, blockchain is the way forward for economy and growth.
As for which industries stand to benefit most from blockchain technology, Alan’s convinced that it’s useful for
any industry where trust is required. ‘It can unlock tremendous value in real estate – especially in developing nations without sound land registries. Entrepreneurs across all industries can benefit from tokenising their business model. Retailers especially will benefit from the lower transaction fees,’ he stresses. ‘Renewable energy networks will get a boost from peer to peer energy trading. Innovators and consumers will broadly benefit as new network-powered businesses emerge.’
The common value blockchain offers in multiple industries, according to Alan, is that it acts as a decentralised notary service and creates a trusted network as well as enables secure and immediate value transfer and storage. However, it’s not without its challenges. ‘Broadly there are technical and regulatory challenges to overcome. Blockchain technology is evolving rapidly, making great progress in terms of the range of use cases, performance and energy efficiency,’ he reminds and adds that these challenges can be overcome by assembling a competent team and advisors.
Alan founded Blufolio, a Swiss based digital asset manager. He’s also its chief strategist. He established Natural Capital Markets at Lykke’s Exchange and listed the world’s first mangrove and carbon credit backed digital token, TREE. Based in Bangkok, Alan was born in Germany and grew up in two continents of Europe and North America. At 47, not only is he a kite flyer and ocean lover but has also acquired over two decades of risk management experience with leading financial institutions and a founding member of the RiskMetrics Group, a JPMorgan spin-off.
Applying Blockchain onto Ecosystem Care
Alan explains how blockchain enables digitalisation of any asset or service and this includes natural capital. ‘Natural capital consists of the ecosystems that make life possible. Working with mangrove restoration NGO WorldView International Foundation, we pioneered a mangrove tree backed digital token called TREE which is available for purchase in Lykke Wallet,’ he says.
Each TREE protects a mangrove in Thor Heyerdahl Climate Park in Myanmar and also entitles holders to special discounts with partners such as Wonderfruit Festival, Misool Eco Resort and Starboard.
‘The positive impact of blockchain on ecosystem care is that it can be used to incentivise the protection of our global commons, powered by sensors and AI. Anyone acting to protect vital areas will be able to immediately earn digital tokens from positive actions that are verified. These tokens can then be exchanged for cash or goods. Put simply, if we make protection of forests more profitable than destroying them, the forests will live,’ says Alan.
However, Alan warns, there are many challenges to overcome when it comes to applying blockchain for ecosystem care. ‘Currently, front line eco heroes are outgunned by enemies with big war chests. Our mission at Lykke.blue is to empower eco heroes with blockchain and this includes tokenising and raising capital. Crowdfunding is vital, as is corporate support.’