Is Blockchain the New Technology of Trust?
Despite issues, companies, especially those in Asia Pacific, are not shying away from the technology
Blockchain continues to be a hot topic across the global start-up ecosystem. And more entrepreneurs are placing huge bets on this technology. Yet the adoption remains sluggish despite the growing investment by start-ups and potential investors. Main reasons for this are fears over security and regulatory uncertainty. Will mass implementation of blockchain technology remain a distant fantasy?
US-based rating agency Moody's Investor Service warns about the risks associated with the technology. "New risks with blockchain technology in securitizations may emerge as well as the reinforcement of some already existing ones. Risks include counterparty concentration, IT and operational risks, inappropriate blockchain governance and legal and regulatory issues," its report says. Another study by auditing firm PricewaterhouseCoopers (PwC) states that trust is one of the biggest blockers to the blockchain's adoption. Concern about trust among respondents in the survey was highest in Singapore (37 per cent) after Hong Kong (35 per cent).
Riding the Wave
Despite issues, companies, especially those in Asia Pacific, are not shying away from the technology. Singapore-based LALA World Chief ExecutiveOfficer and Founder Sankal Shangari believes blockchain technology is not only bringing in a difference at the consumer level but also posing a threat to the established system of governance, which is obtrusive of financial freedom.
"A lot of myths are floating around the technology. It was dubbed as a dubious technology, which may look promising, but was porous and could be compromised. The reality is far from it, the technology is secure and reliable than any of the other techniques available. But at the same time, it is complex and in a nascent stage just like the web was in the early 1990s and that is what helps the naysayers in spreading heresy about it. The need is to understand its applicability to a particular problem and the impact it has in solving it," says Shangari.
LALA ID, a product of LALA World, is a comprehensive solution that protects the personal information of users through the immutable blockchain technology. Additionally, the start-up offers features like crypto payments through its application. "The world is going gung-ho about the possibilities of the said technology, which is gradually growing as an infrastructural pillar of economic functionalities, receiving the attention it deserves," stresses Shangari.
Mike Davie's Quadrant Protocol leverages blockchain and smart contracts to track the data's journey along the data chain—from the originating device to the data scientists that add value to the data—and provide automatic compensation every time the data is purchased. This helps create a more sustainable data economy. The start-up serves as the blueprint that provides an organized system for the utilization of decentralized
"Data quality is vital to the success of artificial intelligence. Algorithms will believe whatever the data tells them to believe, so using poor quality data can result in unintended consequences. Data consumers, therefore, need to know where the data is coming from and be able to trust the source. At the same time, the original providers of the data are rarely compensated fairly. Data consumers like data scientists or AI practitioners can be assured of the quality and provenance of the data being purchased, while providers are compensated fairly. All compensation is paid in Quadrant Protocol tokens, which are recorded on the blockchain," says Davie.
The company's primary focus is on location data, which is an essential tool in understanding the behaviour of potential customers. The platform processes over 50 billion records a month, enabling organisations in every industry to obtain data they can use to make business and policy decisions. It is powered by a protocol that uses blockchain technology to authenticate and map this data.
Insurtech company Hearti is serving insurers with their proprietary artificial intelligence (AI) and blockchain platform. Keith Lim, Chief Executive Officer, Hearti, believes blockchain's immutable nature can foster trust in the insurance agreements between consumers, insurers and partners.
"Smart contracts are executed based on events that trigger conditions within the agreement (for eg. to pay out claims in the event of a flight delay). When claims data is shared securely on the blockchain, duplicate claims and fraud can be tracked and detected. Such uses of blockchain create huge value for our company's proposition and put it at the forefront of the industry," says Lim.
Founded in June 2015, Hearti Lab was born out of the realization that there was a void in the corporate and personal insurance sector: the lack of a low-cost, full-featured AI platform for insurance management. To achieve its vision of developing an integrated insurance platform, the start-up has developed two complementary platforms: BENEFIT.X and SURETY.AI.
In Tech We Trust
For Joseph Lee, Chief Technology Officer, BridgeX Network, blockchain is the "new technology of trust". BridgeX Network is a financial ecosystem framework, built on a proprietary technology core that bridges the worlds of cryptocurrencies and fiat.
"We are using blockchain technologies to create a platform to allow lenders and borrowers to transact directly in a secure environment. The terms are specified in the blockchain and will be executed automatically without bias. The costs saved from eliminating intermediaries are passed to participants on the platform," says Lee. "Perhaps due to the newness of the technology, there may still be a trust deficit with the public. But we strongly believe in it."