Blockchain Insider Ep. 25. 
Keanu Reeves on Bitcoin, Vanguard on Blockchain and Cardano
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Audio Length: 		01:03:13	
Audio Quality: 		Good	
Number of Interviewers:		1
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ST:	We are here at 11FS headquarters in London WeWork for Episode 25 of Blockchain Insider. Today, we bring you Keanu Reeves’s controversial take on Bitcoin, Vanguard plans their own blockchain network, and two more fantastic interviews. On with the news.
[Break]
ST:	Okay. Joining me for the news, as ever, is the wonderful @ColinGPlatt, back in France. How are you, sir?
CP:	Doing fantastique.
ST:	[Laughter] are you feeling better, being away from the cold of London?
CP:	Ah, it’s still cold down here [laughter].
ST:	Ah, it’s cold everywhere, except in the world of blockchain, which is hot, hot, hot. Before we start, we just have to let you know that today’s episode of Blockchain Insider is brought to you by Corda. Corda is an opensource blockchain platform that allows businesses to transact directly, in strict privacy. Using smart contracts, Corda enables complex transactions using real assets, and legally binding agreements, without the need of a trusted intermediary. Corda is the result of a collaborative effort, led by R3, with over 160 of the world’s largest banks and technology partners. It’s ready to build on today. The financial community is deploying Corda to manage their agreements, and move assets globally. Now you can transform your business ecosystem with the platform selected by the world’s largest institutions to build their future on. Go to Corda.net to learn more. Now, let’s dive straight in, Colin. The first story, on the FT, speaking about how mainstream this subject is getting, TheFT.com talks about dueling Bitcoin futures going head to head, as the CME launches their contract, I believe. So, we seem to have been talking about this for the last few weeks, so, for anybody who wants a recap of what a futures product is, or options, check out Episodes 21, 22, 23 and 24 of Blockchain Insider. But let’s just drive right in. We-, we have a competition, there are more than one people offering these sorts of products in the Bitcoin market. What does it all mean, Colin?
CP:	Well, so, what was really interesting, this is something that, as you said, we’ve been talking about for a long time, the CME has finally come live, as of yesterday, when we were recording this. A lot of people bought up Bitcoin in anticipation, a lot of people talked about how you might have hedge funds jumping in, both with the CBOE announcement that came out of it a week ago, and with the CME announcement, now, of launching futures, that there could be a lot of people selling, or shorting, Bitcoin. What that means is, essentially, they profit when the price of something goes down. We haven’t really seen that happen, the price moved around a little bit, which we won’t really get in to too much, but nothing major has really happened. One thing I will note is, the volumes on both the CBOE, that launched last week, and the CME, were much smaller than maybe more their traditional products, on things that they’ve been trading for a long time, things like interest rate derivatives, or equity derivatives, or agricultural derivatives, like the price of wheat, or corn, or oil, or something like that. So, it is still a very small business for them, I just pulled this up before we got on the show. If the CME was an exchange, it would be somewhere around the 27th largest exchange in the world for trading cryptocurrencies. So, it’s not exactly to say that this has completely changed everything, and we’re now in the world where every hedge fund in the world is trading Bitcoin, though we’ll talk about one that is, later in the show. But it is-, it is a good start, and it is a sign of maturity and legitimacy that we didn’t have three weeks ago.
ST:	And also, it being open doesn’t mean that there’s no demand there, if it’s not all taken in the first week. It’s going to take people time to move in to that space. And it’s-, I think it’s a big signal, the fact that such a classical institution, such as the CME, and such as CBOE, have launched this product. It says that there’s institutional interest out there, which is kind of reinforcing this belief that the institutions will come in, therefore there’ll be more liquidity coming to Bitcoin, therefore the price will go up. But, of course, shorting doesn’t necessarily mean the price could go up, it could create downward pressure, but there’s a great clip I saw, I think it was on Bloomberg, of the Winklevoss twins challenging Jamie Dimon to go short on Bitcoin, because now you can profit from the price decreasing for the first time. So, interesting times, for sure, Colin.
CP:	Absolutely, and I think-, I think one thing that I’ll just add on-, on top of this is, we’re having a lot of recent conversations with people, in our normal day to day job, and a lot of these companies are interested in Bitcoin, maybe have been in Bitcoin for a while now, and they have pointed out that there aren’t a lot of solid, institutional focused Bitcoin exchanges, or places where they can trade cryptocurrencies. So, the platforms that you or I might use, for individual moving money around are the same things that very large companies and hedge funds have to go through as well. So, I mean, to me, the big change here, and you mentioned the Winklevoss twins, what they’re trying to build, with Gemini, all come to, kind of, bring those rails in, for somebody like Jamie Dimon to go short Bitcoin, or long Bitcoin, if, at some point, JP Morgan decides they want to get involved.
ST:	There are, I think, now some fairly well-known OTC desks trading Bitcoin at some serious scale, but, as you say, those infrastructure partners that you would expect on the more traditional asset classes just aren’t there, and if you, as a consumer, have had problems with Kraken or GDAX lately, trying to access it, you’re not the only ones, and some of the bigger institutions may be having some of the same problems, as well. So, there’s definitely a need for either these newer exchanges to up their game in terms of their infrastructure, or maybe even an opportunity in the marketplace. Colin, next story, given that you’re back in France, this one seems like it might have been something you picked out. A story on Reuters about the French Finance Minister calling for Bitcoin regulation debate at the G20.
CP:	Yeah. I-, this was really interesting, I can’t remember if it was last week or the week before, Bruno Le Maire, who is the Finance Minister in France, talked about how the-, France was trying to be open to innovation, and we made a good joke about Brexit on this, bringing people in to use blockchain to list securities, something akin to what Nivaura has done. Now, he’s come through, and said in the next meeting, he’s going to talk to the upcoming G20 President, so G20, obviously, being a group of the 20 largest economies in the world, and the leaders in that, to talk about all kinds of things, from the economy to human rights. So, the next one is in Argentina, Argentina, for those who follow Bitcoin, is a very large market, actually, for the size of the country, for Bitcoin. A lot of that has been attributed to the instability in the country’s finances, they’ve defaulted, I believe, three times in their history, on their debt, their money’s gone through massive hyperinflation on multiple occasions, so, the notion of using Bitcoin is something that people might be willing to take a gamble on. So, really interesting to see that, on one hand, he’s talking about, “We need to be more open to innovation.” At the same time, he’s saying, “Let me get together with this person who’s almost probably the most well-placed person to talk about Bitcoin being used by the masses,” and said, “We need to sit down, and we need to talk about this thing, before it gets out of hand.” So, that tells me two things. First, at some point regulators will say something, and, it hasn’t yet gotten out of hand. So, we talk about the price ramping up by, what, 200,000 times or whatever, over the last few years, they don’t think it’s quite large enough to warrant completely blocking access, or trying something more severe quite yet, but it still could come.
ST:	It could come indeed, Colin, there’s definitely the increased pressure coming from regulators, because I think they’re concerned about some of the-, some of those things that you pointed out. But who’s not concerned about them? Well, the one person that’s not concerned about them is Mr Keanu Reeves. John Wick himself, in yournewswire.com, Keanu Reeves says, “Bitcoin will destroy the New World Order,” and I can picture his voice in my head. This is-, this is the quote from him. “Bitcoin isn’t a short-term trend, and that worries the elite. People are sick and tired of being controlled by the New World Order, seeing the rich get richer and the poor get poorer. Bitcoin is giving power back to the people, and it will probably end up destroying the New World Order.” [Laughter].  Like, god bless him. Love a bit of John Wick, love a bit of The Matrix, but this is probably a bit of an oversimplification of something that, actually, maybe has something to it. Bitcoin was, I think, at its birth, a bit anti-establishment. It did bring about a new governance model, and a new way of thinking about how we design infrastructure and community, as people, and I guess this is, kind of, more evidence of it being mainstreamed, but how serious do you think that people cottoning on to these ideas are, and do you-, and do you play with the idea of remaking financial services, remaking governments, in a short timeframe, and the reactions from the French minister, and people needing to discuss this at the G20, seeing it as a real, credible, serious threat to the way they’re organised?
CP:	Yeah, so you and I had a conversation earlier this week where we were kind of joking about this. I mean, to me, the way I view Bitcoin is, yes, as you said, libertarians really latched on to this thing, when it first came out, back in 2009, 2010, and said, “This fantastic, this replaces central bank money, this takes down governments.” And there’s still a lot of people that follow Bitcoin, that invest in Bitcoin, that are very serious about Bitcoin, for exactly this reason, and any time you have somebody who comes out and champions it, like Keanu Reeves, it always takes me back, when I was reading this, to a very famous Bitcoin meme, of the scene in The Matrix, where Keanu Reeves says, you know, “Are you telling me, in the future, that I can trade Bitcoin for $1 million?” and then it says, you know, “No, I’m telling you, in the future, you won’t have to.” So, I think it’s quite perfect that Keanu Reeves talks about it. But, where this is really going is, a lot of people come out and say, you know, “We need to regulate it,” or, “It’s a scam,” or, whatever negative they have about it, and it almost reinforces to people that believe in it, and belief, I think, is the exact word here. It’s not “that understand the power of it”, it’s people that truly believe in this vision, and, you know, when you have the champions like Keanu Reeves, and when you have the establishment coming and saying, “We’re going to squash it,” or, “It’s useless,” it makes them buy more, and it makes other people buy more, and I think this is what people, that are trying to warn the masses about, and say, “Don’t look at the returns that are 200,000%. Look at the risks here,” they really don’t get it. Because this is just propagating the people that believe, and they throw more and more money in it, and the prices go up, and your average Joe, your nanny, goes out and says, “I need to buy this.” And they are making the bubble worse.
ST:	When the establishment says, “This is risky,” they’re adding fuel to the fire, and it’s playing in to a narrative that, “Hey, the establishment doesn’t like it, therefore they must be scared, therefore it must be something that’s working.” Yes, it’s a-, you can see how it’s a bit of a self-fulfilling prophecy, but there are people of, you know, kind of with a strong track record in financial services, doing some interesting things, without question.
CP:	Absolutely, and a good one that you pointed out was Bill Miller. So, Bill Miller is a hedge fund manager. He’s recently reported that he has as much as half of his whole fund in Bitcoin. That sounds awfully risky to me. What do you think, Simon?
ST:	Awfully risky indeed. Half is quite a lot [laughter]. That’s like a divorce with your money, if it all goes wrong. So, yeah, notice they’re exploring ways to mitigate risk, and that Bitcoin won’t be half of the fund for that much longer, but it doesn’t mean he’s going to be selling Bitcoin, and it was-, the closest he’s come to having half his fund in one asset, was the 1990s, when he had 20% in AOL, and close to 20% in Dell, and 10% in Fannie Mae. So, I mean, these guys have been around for a little while, and this was an interview they did in the Wealth Track podcast last week, so do check out another podcast, and hear from him for yourself. He founded this new partnership in 2016, after a 35-year career at Legg Mason, where he managed the fund that beat the S&P 500 for 15 straight years through 2005. He’s known for these concentrated bets, but nothing on the scale of half the fund. So, maybe it’s a timing thing, maybe he’s just seeing, like, outsized opportunities in the short term, but it’s a bold bet for sure, and when people say, “Look, the institutions are here,” and as you said a couple of weeks ago, “Mainstream moment is here,” I think that’s well and truly the case.
CP:	Yeah, and I think the other thing I read in to the fact of what you’ve just said, that he’s not planning on selling it, but he is reducing. I think he’s going to be selling CME and CBOE futures, to be honest, so this is the ability for somebody that already holds it to say, “I’m going to fix my price in the future on it,” and though he’s not necessarily directly going out and saying, “I’m going to sell this,” he’s able to make some money on that, without further taking risk, or he’s actually reducing risk. And given the prices on this, for anybody that’s familiar with how derivatives trade, that can be extremely profitable. So, I wish the-, I wish him all the luck in the world [laughter].
ST:	Absolutely [laughter] but we may be in a bubble. There’s this famous chart that’s been going round, from convoyinvestments.com, that tracks Bitcoin against Tulip Mania, and I think it was, kind of, about-, doing the rounds about a month ago, and it said that Bitcoin in 2014 to today was halfway up the Tulip Mania bubble, and it looks like Zerohedge put something out last week, Zerohedge.com, showing that, actually, it’s official, that Bitcoin is now the biggest bubble in history, having surpassed the Tulip Mania of 1634 to 1637. So, the CEO of SWIFT is going to be a very happy chap with this chart, surely.
CP:	I’m sure he will. I-, I still-, I have a problem with this chart. I mean, it-, whether we call it a bubble or not, there’s certainly-, we talk about it as a bubble. Whether it pops the way a bubble pops, we don’t yet know, so, I think a lot of people are just saying this to get clicks, and Zerohedge is no stranger to clickbait.
ST:	People like to put something in a historical context, to be able to understand it, but on the flipside of that, people always say, “This time, it’s different.” But there was a great chart I saw earlier, that said that Bitcoin does periodically drop by 30 to 40%, it does these pullbacks all the time, which, in any other market would be a massive, massive bubble bursting, but in Bitcoin it’s just par for the course with some of its volatility.
CP:	Yes. Absolutely. And I think that-, the fact that it has those drops dispels a lot of the myths, when people start talking about a Ponzi, because, generally, Ponzi schemes try to avoid that, so people don’t pull money out. The fact that Bitcoin has prices that move up and down-, it’s just a very heavily levered, very narrowly traded asset, in my mind.
ST:	So, there’s a story here on DavidGerard.co.uk, so this is going in to-, in to a blog, and he’s got a book, as well, called “Attack of the 50 Foot Blockchain”, which I think is a great title for a book. The public discussion, he says, and media coverage around Bitcoin, makes certain assumptions. It assumes Bitcoin has a price, that you can expect to sell it around, Bitcoin is like buying a share in a company, or a commodity, like gold, and the market works that way, and that Bitcoin is liquid, it’s reasonably easy to convert your money to Bitcoin, and Bitcoin to money, back in to your bank account. And he says none of those are true. So, what’s going on here, Colin?
CP:	So, Mr Gerard here is one of those people that I mentioned just earlier in this part. He’s-, he’s the establishment. So, he points out what I think are very valid concerns. The price is uncertain, especially if you’re trying to sell a large quantity of Bitcoin. You don’t have the same rights that you would, if you were to buy a company stock. I disagree, when he says that it’s not a commodity, I-, I think it is, it’s a new type of commodity, and his question about liquidity, I know a lot of people have talked about, very recently, their experience in trying to sell Bitcoin on Coinbase, or in other exchanges, and it costing a lot of money to get money back in their bank accounts. It’s certainly-, it’s early days, I mean, we’re nine years in to this thing, but nine years in financial markets is nothing, and I think, by trying to slowly deflate this thing, by talking about how these promises aren’t met, he’s kind of missed the ticket, and-, and may just further inflame what’s coming through. They are very valid points, and anybody considering buying Bitcoin, or any other cryptocurrency, should really read this thing, take it to heart, understand why he’s saying these things, before you put any money at risk, especially any money that you can’t afford to lose.
ST:	There is very little downside to being more informed.
CP:	I would say there’s none.
ST:	Next story. One in American Banker, Colin, about an organisation called Vanguard, who will be very familiar to folks in the US. They have apparently leapfrogged cautious banks, by unveiling their own blockchain network plan, and joining us to talk about just this story, we have 11FS’s own Pete Townsend. Pete, how are you, sir?
PT:	Excellent, Simon, thank you very much.
ST:	Thank you for being here. Just for our listeners who are new to your good self, tell us a little bit about you.
PT:	Yes, so I’m a consultant, advisor, speaker. I am the Asset Management Lead for 11FS, I’ve been working with you guys for a few months now, and trying to deliver everything digital to the asset management world and the investing world. And trying to get ahead of the curve with all that.
ST:	Sounds fun. So, this Vanguard story caught your eye. What do we think’s going on here? What problem are they solving?
PT:	Well, if you take a look at what Vanguard do, Vanguard are one of the largest providers of passive funds in the world. Passive investment funds, follow an index, and they’re kind of like following a recipe when you’re cooking, alright? In that, when you finish the meal, and you finish-, you get it out to the table, it’s probably going to taste good, but you can’t take a heck of a lot of credit for it, because, you know what?  You followed a recipe. Index investing, or what are referred to as exchange traded funds, if that index fund is traded on an exchange, is following a published index. Okay? These indices, there’s hundreds of them in the world, that exchange traded funds, managed by issuers like Vanguard, Blackrock, so on and so forth, that they offer to their clients, but what-, the interesting thing that happens is that the publication point of the index, typically, take the S&P 500, Standard & Poor’s, what they do is that they charge the fund that uses their index as a benchmark, and that’s how Standard & Poor’s make money off of all this. It sounds great, right? Well, not really, because, by 2012, Vanguard had become so successful that they ended up needing to have a specific discussion with Standard & Poor’s on the fees that they were charging them to-, to link to their benchmark. So, what Vanguard decided to do, in 2012, was to work together with a group called CRSP, the Chicago-based Center for Research in Security Prices, to develop some new indices. Now, the S&P 500 versus this new bigger one, that’s really interesting, or, well, five years old now, that’s very interesting, they’re kind of like night and day. So, the S&P 500 follows 500 equities in the US stock market. The CRSP Total Stock Market Index follows about 3,500. Why this is interesting is that Vanguard have been working with CRSP, as well as Symbiont, and Symbiont, as many of you know, are specialists in smart contracts with DLT. And what it looks like they’ve done is, they’ve built an information-sharing framework, so that the publication point of the indices, which is CRSP, they built so many rules and methodologies into their indices, such as when they need to rebalance, reconstitute, there’s a lot of technical jargon in all of that, that I won’t get in to, but it’s a big job. And then, any time that any index information is updated, it needs to be sent on to those that are using that index as a benchmark in their ETF, and it-, it’s a huge amount of information that needs to be sent on.
ST:	So, every time each ingredient changes ever so slightly, there’s a whole down-, you know, so the book printer has to know it, and then all the retailers have to know it, and they’re updating the ingredients in these recipes almost every time it happens, but you’ve got sometimes weeks, if not months of lag for that to happen, and a lot of manual processes for people to be able to figure that out. Is that fair?
PT:	Absolutely, and if you-, you have five more people coming to dinner, instead of the five that you thought, you need to double the recipe. The other way goes, if you’ve got a few people not turning up, you’ve got to take a few things out, right? So, but it’s still, you’ve got to put spaghetti Bolognese on the table, right? So, what it looks like they’ve done is, they’ve built this framework, to be able to very-, to completely streamline the process of providing these recipe updates, really, to Vanguard, so that Vanguard can then act on them, and it looks like Vanguard have built some internal processing around that, in order to streamline how they send trade messages out to the market. And you can think of it in a-, as a series of nested smart contracts. Each individual security in the exchange is developed as a smart contract. That is then nested in to a smart contract that is the index, which is then potentially, and I’m not sure if they’ve gone this far, but nested this in to a smart contract that is an exchange traded fund, which really starts to open things up, in terms of passive fund processing.
CP:	So, what really stood out to me in this, Simon and Pete, was, we talk a lot about blockchain, specifically cryptocurrencies, being used for payments. I can send you a Bitcoin, or a fraction of a Bitcoin, and maybe I could do that in something like a Ripple, as well, I could send you a fraction of a euro, or an XRP Ripple. Now, this is-, this is very different. This is merely sending you messages through smart contracts, to say, “This is how you should process,” and you-, you do everything else after that. So, they’ve taken a very different tack, but, I think, Simon, we’ve talked about this before. Some of these things are-, are less scary for companies, because they actually help make things more efficient, and, this being a business where your revenues are very low, your costs are very high, any way that you can reduce those costs is a benefit, and I think they said that this isn’t just merely a test, they’ve actually got, already, more than 5,000 validated transactions in doing this. So, it’s-, it’s definitely leapfrogging ahead, as the article says, to put something in place, and it’s not at all a payments system. So, they’re using smart contracts for something very different, that is working, and is showing its benefit right away, which is incredibly interesting to me.
ST:	Super interesting things happening in the DLT space. I’m sure we’ll follow this one as it develops. Okay, Colin, next story is from the Gnosis.pm website, so, Gnosis, famous token sale, I think came out of the Consensus guys, was it, Colin?  I may be wrong, actually.
CP:	Yes.
ST:	Yes, it was Consensus. There you go, realising things on the fly, keeping it in the podcast. So, they-, they’ve actually done a very interesting blog post, that looks at the pros and cons of centralised exchanges versus decentralised exchanges, and especially when dealing with-, with different tokens. So, centralised order book exchanges, they talk about-, it’s a really good educational piece on how bids and asks and spread works, I highly recommend checking this out, on their blog, and then they call out a couple of major shortcomings on centralised exchanges. So, on centralised exchanges, they say, because they’re an illiquid market, frontrunning is a big problem, where not even the exchange could act on orders before they’re published, and people can procure profits at the expense of other participants. But then, on the up-, on the reverse, they also say a decentralised order book, they’re inherently set up in favour of miners. So, they needed to design an exchange that’s built on an auction mechanism. So, Colin, unpick some of this stuff for me. What are the challenges in centralised exchanges, and why-, what is front running, and then what are we seeing in decentralised exchanges, and do we think this-, this Gnosis thing makes sense?
CP:	Yes. So, one of the first big things that they talk about in here is-, is the risk of theft of your funds. So, for those who have paid attention to Bitcoin for a little while, there’s the fabled story of Mt. Gox, which, in 2014, declared bankruptcy, because it lost, at the time, $400 million worth of Bitcoin. Now, I thin kit is-, is, what, in the billions.
ST:	Yes.
CP:	So, the worry is, if you put all this money in, all your eggs in one basket, as it were, and somebody decides, “I’m going to steal eggs out of that basket,” you don’t really have a lot of recourse. So, by moving these things into a decentralised ledger of some sorts, that happens to have a payment mechanism in it, let’s call it a blockchain, you reduce that risk, because people can’t necessarily steal this from you, without everybody else agreeing that it should be stolen from you, which is a very high burden of proof. Now, the next thing in there they talk about is something called frontrunning. So, this is, essentially, if you’re trading on an exchange, and I’m sitting behind you, and I’m seeing you trading, and I’m seeing everybody else trading, well, I can use that information to my advantage, and I can go put in an order, and execute my order before yours goes through. Some exchanges have been accused of this. Before Bitcoin ever appeared on the scenes, banks have been prosecuted for it, hedge funds have been prosecuted for it. It’s generally illegal, in a lot of senses, or, at least amoral, where it’s not outright illegal. So, they’re (? 26.06) that out. The other thing they talk about is in the decentralised exchanges, if we move things out, and there have been things like the 0x project, and, and a few others, they say, essentially, those miners can, not front run, but do something very similar, where they process their transactions in a different order, to maybe take advantage of prices moving up or moving down. Of course, a miner inside of a blockchain is the one that orders transactions, and declares what is the valid truth at some given point of time. So, they could take advantage of this inside of an exchange.
ST:	Okay. So, Colin, a whole bunch of interesting stuff in this blog post. I would recommend people check it out, without question. There’s definitely the pros and cons of these emerging models, and I do think it’s interesting that they’re putting these sorts of thinking out there into-, into the public domain. And, definitely, as we talk to, and look to institutions coming in to this space, who have looked at illiquid markets as being one of the major risks of, kind of, moving in to some of the smaller crypto assets, then there’s definitely an opportunity for fairer, auction-based markets to maybe play a role in resolving some of that.
CP:	Yeah, and before we tune out of this, one thing I’ll just point out, it’s probably not the greatest idea that these guys put a picture of a tool up on their blog post [laughter].
ST:	[Laughter] yeah, probably not, although, I do wonder if that was somewhat self-aware.
CP:	[Laughter] hopefully.
ST:	And, speaking of new things that are coming along, the last story we’ve got time for this week is one I picked up in Nasdaq, but I think it’s been pretty much everywhere. So, Cardano, “the Ethereum of Japan,” jumps to the top six, so, into the top six cryptocurrencies by market cap. So, Cardano describes itself as the Ethereum of Japan, jumping from 2 US dollar cents to about 52 US dollar cents in the space of a month. A decentralised public blockchain and cryptocurrency project, and developing a smart contract platform, which seeks to deliver “more advanced features than any other protocol.” According to the company’s website, Cardano is worth in excess of $12 billion US. So, their website is Cardanohub.org. There’s a few interesting things as you click around in this. They’ve-, they’ve definitely done their-, done a lot of due diligence world, as you read their whycardano.com, this is quite a long read, quite a lot to it, but, at the same time, it appears that there’s not a lot of code out there. It’s PDFs, they’re taking a scientific approach, lots of this has been peer reviewed, and they’ve definitely gone their own route with some of the excitement around building a proof of stake based consensus and mining setup, that claims to be as secure as Bitcoin’s proof of work, but much faster and much more efficient. And, of course, famously, Charles Hoskinson, who was involved very early in Ethereum, and then BitShares, and several other projects, is deeply involved in this one, as well. So, Colin, what are your reactions to this one?
CP:	Oh, I think $12 billion is a lot of money for some PDFs and a website. Look, I-, it-, they’ve got a lot of great ideas, and they’ve got a lot of great people behind. I know the Cardano Foundation brought in Michael Mainelli. Dr Mainelli is very well-researched on everything that’s blockchain, before we even called these things blockchains. It’s good to see that they’re getting traction, they’re getting networks around. I know Chris Burniske always talks about network value and these things, it was very interesting, somebody pointed out, of the top ten cryptocurrencies, Cardano included, two of them didn’t yet have networks. So, if we’re talking about network value, that’s-, that’s hard to believe, how this happened, so, a lot of faith in this, a lot of anticipation. Personally, I-, I am going to wait and see, before I move any money in to this, or make any kind of comments either way.
ST:	Yes, I-, you can understand the perspective from the third-party observer that, here is one of the people that was involved early on in Ethereum, one of the people involved early on in BitShares, both of which went on to increase in profile and value, and therefore people are just looking for it to do a repeat. And, without question, the website is worth a read, just at face value, because there are some interesting ideas in there. We don’t give investment advice out on this show, and we would encourage everybody to do their research, but it’s certainly getting a lot of hype and traction, at the moment. But also, we’ve seen a week in which we’ve been in bizarro-world, and continue to be in bizarro-world. I mean, Ripple’s value spiked nearly 3x, was it, at one point, when it was listed on Coinbase’s GDAX, so we are going through strange times, Colin.
CP:	Absolutely, yeah, and I think that anybody that’s followed this for more than a couple of hours has seen the absolute volatility in all of these, especially as you start to move down the list of, you know, network values. Ripple is one that, historically, has had a relatively low volume of trades for the size of the network value, so, a very small investment can move this thing a lot. They had some big news, which tends to make this thing go up, this last week was just a very extreme case of that.
ST:	Unquestionably, if you’re a fund manager, or if you work anywhere for helping institutions invest, you look at this market, and see it as very strange, and very hard to pass, and I can see why. There’s a lot going on here, and it takes a long time to understand it, and, as we said earlier, there’s not a lot of that infrastructure that you’d really expect in-, in some of the more traditional markets. Stories we didn’t have time to cover this week. Loopring, a decentralised exchange and open protocol, is well worth your time and attention. Loopring.org is their website, looks like they’re doing a whole bunch of interesting stuff, and we may try and cover that on a future news show. A story on Motherboard, that the idea of HODL, or Hold on for Dear Life, HODL, is now four years old. Apparently, their headline is, “The only good Bitcoin advice is now four years old.” So, that is a meme, that is something that, as you get in to this space, you will hear a lot of people talking more about. And, speaking of memes, on Reddit, the Cryptokitties team did an “ask me anything”, so, that was more than a little amusing, but also had some serious questions around security in there, I believe.
CP:	I bet you read that one with a lot of interest, congratulations on your Secret Santa present of a Cryptokitty, Simon.
ST:	Indeed, I’m-, I’m feeling very pleased. Meow. Meow indeed. Okay. So, don’t forget, listeners, you can let us know what you think about any of the stories we’ve covered on Twitter, by getting in touch @BChainInsider. Share your thoughts, or just give @ColinGPlatt some stick, for not making any Cryptokitties jokes this week, or @SYTaylor, if you want to pick up on anything I’ve said, as well. Or, you can drop us an email, at Podcasts@11FS.com. We’d love to hear from you. As a reminder, 11FS, the company that brings you this podcast, are a challenger agency, who help banks, asset managers, or anybody in the investments market, understand this space better, and achieve more. If you want to understand how to commercialise blockchain projects, or just what’s going on, then, please do get in touch. Get in touch at Hello@11FS.co.uk, or find out more on our website, 11FS.com. Okay, let’s dive in to the first of our interviews, with Mark Jeffrey from Guardian Circle.
[Break]
ST:	Mark, how are you, sir?
MJ:	I am doing great, how are you doing?
ST:	Really well, thank you. Thank you for being on Blockchain Insider. I guess, first of all, can you tell me a little bit about your background, and what got you interested in the subjects of blockchain, DLT, that whole space?
MJ:	Yes. So, I started life as a software engineer, so I had, kind of, the engineering background, and I’ve been CTO and CEO at various companies, over the years. Basically, sometime around 2013, I’m friends with Brock Pierce and Michael Terpin, two names you might know, and they were just on and on and on about Bitcoin, and I initially thought it wasn’t real, because it sounded very much like Flooz, if you remember that, from the 90s. So, some other virtual currencies. I didn’t get that it was decentralised, and-, and when I actually sat down and tried to figure out how it worked, once I finally understood, I just went, “Oh my God,” and, you know, I had that, sort of, moment, that a lot of us have had, and I-, I ran home, and I wrote a book [laughter] called Bitcoin Explained Simply, in 2013, once I got it, because I just felt like no one had done that well yet. And then I wrote another one, in 2015, called The Case for Bitcoin, right after the Gox crash, and everyone was saying, “Ah, this is garbage, it’s not real,” and I was like, “Oh no, this is very, very real.” So-, so that was, kind of, how I got involved.
ST:	It’s very, very real indeed, now we have futures trading, and, so what’s the journey looked like? I guess Bitcoin became real, but it’s-, maybe it’s not everything. Did you find yourself in the need to do a project, and solve some of the world’s problems using similar technologies?
MJ:	Yeah, well, I mean, in 2014, somewhere around in 2014, at the end, right at the end, was when I got the idea for Guardian Circle, which is the project I’m working on right now, and that’s a global decentralised emergency response, basically. It started off as an app, to let friends, family and neighbours protect one another, and that was, sort of, the genesis of it. As we worked on it, and as it grew, I suddenly realised, as I started studying the 911 problem, I realised that 4 billion people have no 911, worldwide, just nothing, there’s no magic number you can call. But most of them have phones, weirdly. And then the other thing I realised was, as I studied the problem, you know, I studied 911 in the United States, I got to see how terrible it is. If you call 911 from a mobile device, they have no idea where you are. Uber can find you better than 911. And that’s just the tip of the iceberg, I could be here for the next half hour on this topic. But, basically, it’s nowhere near as good as you think it is, and it’s getting worse every day. You’re not-, and so basically I said, “You know what? We need to just throw all this away. We need to create a new emergency grid from scratch. Something that’s mobile native, location aware, something where your friends, family and neighbours are notified and in an alert room, alongside with official responders, but we also need a class of citizen responders, that you can think of sort of like Uber drivers. People who are vetted and trusted, but who have special skills, like EMTs that are off duty, ex-military. You know, basically, any time an event happens, we should just throw an alert up to the Cloud, the Cloud should look down, and see what people and resources are already nearby, and just create a flash mob of help, out of everything it can find, as quickly as possible.
ST:	Really cool idea, and you mentioned Uber, you mentioned Cloud. Why do I need a blockchain for that?
MJ:	We don’t, and, in fact, we don’t use the blockchain for that part of it yet. And the reason why is because the blockchain is-, it’s a tortoise. It’s not a hare. And in an emergency, you need a hare, you need something fast. Now, that may not always be true, you know, we’ve got people working on stuff right now so that, you know, you have sub-second response blockchains, but they’re not really here yet. But what you do need the blockchain for is to-, there’s basically five different ways in which we’re using it. You need it for the emergency response contracts, and as a form of settlement, especially for the unbanked, 4 billion people who have no 911. You need it so that people in our world can send a coin to sponsor people in the developing world, their safety. The cool thing about that is, when you send it through, you know, a cryptocurrency, it’s not going through a government or a bank, so you know that it was not spent inefficiently or inappropriately. So, that Red Cross in Haiti stuff that happened, it can’t happen here, and the people can only spend it on emergency response solutions.
ST:	So, there’s an element of price and spend transparency, and transparency is one of those often-quoted benefits, but it’s also as transparent as the end point that receives the value. So, as soon as they cash that out, they can cash it out in any way they like.
MJ:	They can only spend it-, so, when they receive it, at least to begin with, they can only spend it on emergency response contracts. So, basically, the paid responders that I talked about, the way it works is, you will purchase-, you can use the free version, with your friends, family, neighbours, forever, for free. That will never be charged for. But once you want the enhanced, paid responders, you basically pay the equivalent of, like, $5 or $10 a month, for you and me. That’ll be different in India (ph 38.39), obviously, but you know, basically, it feels like that. And, whenever you press the button, those responders also respond, they get paid GUARDIUM, based on every hour that they’re on the clock, that they’re available, and, of course, if they respond to an alert, they get paid a little bit more.
ST:	So, it’s these microeconomies, where the amounts you’re moving would probably be so small that the credit card fees would really eat in to that-,
MJ:	Yeah-,
ST:	Unless it was all prepaid, ahead of time, and you were kind of only doing cash in, cash out, like an M-Pesa mobile thing. But even then, you’ve still got the share with the telco that you’re going to have to deal with, through the APIs. So, by creating this microeconomy, you’ve created a market for something where there is no current market, and where there may not be public infrastructure, because, I guess in some countries, the-, the emergency response is free, in some countries it’s a market, and some countries it just doesn’t exist. And where it’s a market, and where it doesn’t exist, there’s ways that you can create a more efficient market, that responds faster, and where it isn’t a market, you can just have a network of people who kind of make the thing more efficient, and-, and a new technology.
MJ:	Yeah, and we think we could probably do it a different way. In a lot of places where it’s a market, only the rich have it. The poor got nothing. So-,
ST:	Yeah.
MJ:	This gives them access to something, for the very first time. There’s two other ways in which we use the blockchain. One is to store all the alert transcripts, and, because we’re using mobile devices, we not only know who said what, when, but where everyone was, what time they responded, or did not respond, we know both things, and all that information is encrypted, it’s immutable, so it’s evidence, and the keys to that evidence, so, that encryption, are given to the alerting party, so they have custody. We don’t, nobody else does, they decide who sees it.
ST:	So, you’ve got a microeconomy that’s global, you’ve got transparency and an audit trail that’s provable. Talk to me about some of your technology choices within that. Have you gone for an Ethereum stack? Are you going for something more esoteric? What choices are you making?
MJ:	So, this is my-, this’ll probably surprise you. We have our own blockchain and our own coin, it is a fork of LiteCoin. It has some additional magic built in to it, it basically has 51% attack mitigation, and it implements-, SegWit’s implemented on it, too, so it may-, I believe it may be the first time SegWit is released on a LiteCoin fork. So, and that was-, we actually worked with Michael Terpin and his technical team, the same people behind Aspire, if you’ve heard of that coin, it’s not out yet, but it’s coming. So, basically, we work with them because, you know, they’re the experts on it. It’s all pre-mined, and, you know, so that’s what we’re doing. The reason we did it, which is probably going to be your next question, um, there’s a bunch of reasons, but the biggest ones are, there’s too much technical volatility with both Ethereum and Bitcoin. As we saw last, you know, this past week, with Cryptokitties, and then, previous to that, we had already seen Civic, when they did their ICO, on the heels of Status, they had to shut down their ICO, because Ethereum-, the entire Ethereum network was just unusable for a day. Our blockchain will be-, I mean, the emergencies aren’t on the blockchain, but payments, and other things, will be, and the transcripts will be on the blockchain. We cannot afford to have any sort of flicker like that. And so, because we’re dealing with emergencies, our tolerance for that sort of stuff is just low, so we just felt, you know, the smart choice, for now, would be to put it all on our own blockchain. That doesn’t mean, in the future, as, sort of, the public things like EOS, for example, become available, and more real, we might go-, we might move it over to one of those blockchains. But, for right now, today, we felt this was the best choice.
ST:	Interesting set of choices. I guess two follow-ons, if I may. On one side, the technical stack that’s not to do with the blockchain, just, I’m guessing that’s your standard devops looking stuff, all your Web 2.0, AWS type stuff, and then on the blockchain side, what were the-, what was the delta that public key cryptography could have given you, versus what this blockchain design gives you? Like, what’s the delta between the two, and why you felt the need for the blockchain.
MJ:	So, I’ll, sort of, address your first question. So, we’re on-, everything’s AWS, we’re in multiple region servers around the world. We have working apps, they’re built on Cordova, so that we could release them simultaneously on iOS and Android, and, let me tell you, that was very painful, but we-, you know, it took us, like, a year of pain to kind of get that right, bottom line. We learned a lot, we learned that SMS doesn’t work very reliably in a lot of countries, didn’t know that when we started. We also learned that, on versions of Android, certain versions, they don’t open up web sockets according to the standard. They’re just like, “Nope, we don’t feel like doing that.” So, we had to write our own web sockets layer. So, just-, I mean, and I could go on forever, there’s a whole bunch of pain we got through. But we now have those two apps, we also have an Alexa version, so you can speak your alert to your Alexa device, and that will-, you know, so, if you’ve fallen and you can’t get up, you can just yell, and that will trigger the alert. We also have an open API, which is being used by a whole bunch of people, to create alerts, panic button, jewellery, and other alert devices. We’re the partner on the Women’s Safety XPRIZE, so, with the XPRIZE foundation, that’s basically where most of these people are coming from, that are creating alert devices, so.
ST:	Really cool. So, that gives me the tech side. And now, my second question is, what does the blockchain give you that public key cryptography wouldn’t have?
MJ:	Well, I mean, the blockchain gives us all the, you know, the magical things, like immutability of the transcripts. One thing I haven’t talked about yet is, we also allow for an emergency information lockbox, so, this is basically a place where you can create a record of all the stuff you don’t want anyone to know about, unless you’re in trouble. So, that might be your secret health issue, it could be where you hid the key in your front yard, that sort of thing. It’s only unlocked when you create an emergency alert, and it’s only accessible to the people that you designate, so it’s a multisigs solution. There are probably-, to answer your question, there are probably other ways we could have done this, but because the tide of the world and, you know, the big world effect, that all the innovation that we’re eventually going to benefit from, like a rising tide, it rises all boats-, lifts all boats, is in the blockchain space. So, you know, really, that’s probably the biggest reason why we went that direction, instead of perhaps another option.
ST:	So, yeah, and I guess building governance around something that’s managing public key cryptography, and proving its transparency, is a little harder, but, I guess who are your miners? Who are your-, you said you were all pre-mined. Who are your nodes? How are your nodes looking? Are you running the whole thing?
MJ:	We are running the whole thing right now. In the future, we will hand off, you know, we will allow other people to process transactions, and, in the future, our intent is to actually put the alerts, and the alert processing, and all that stuff on the blockchain also, it just can’t handle it yet. So, eventually, there will be nodes in the hands of a lot of other people around the world, that are processing emergencies, and the act of processing a transaction will be the act of running this new 911 grid that will encircle the planet. So, you know, baby steps at a time. I’ve got to make sure-, I’ve got to be conservative right out of the gate, and make sure all this stuff works for the first rollouts, so.
ST:	So, you’ve got your arms around it now, to make sure it works, but your vision is that, actually, there would be many other organisations, emergency service organisations, countries and whatever else, making this product and project work, by running nodes within it, so that it actually becomes a network that, wherever you go in the world, you have access to-,
MJ:	Right.
ST:	But, unlike an Uber, I guess, it could work without you-, it could work without Guardian Circle incorporated, I guess?
MJ:	Yes, that is the vision. Ultimately, we just, sort of, step away, and we ant other people to make apps that are GUARDIUM-compatible, and use GUARDIUM for maybe even different things than what we envisioned when we began it. So, a lot of people are talking about the fact that, you know, we’ll be able to transfer GUARDIUM between accounts, just by knowing their phone number, and that in itself may-, that, combined with the philanthropy, and the network we’re going to set up for people in our world, to send money, directly, to sponsor-, to sponsor people in the developing world for safety, is one way in which that could be used. There are other philanthropic uses of that, as well. The XPRIZE has already noticed this, and said, “Oh, jeez, you could use it for lots of things more.” Yes. We want you to. So-, so I do think that stuff is coming.
ST:	So, you’ve talked about XPRIZE a couple of times. Give me a feel for who your partners are, and how this thing’s going to reach scale. How are you going to get people to any attention to this, and how is it going to get mass adoption?
MJ:	So, our-, well, our first foray is through the XPRIZE Foundation. We’re the partner of the Women’s Safety XPRIZE. Basically, they expect-, so-, so, the prize itself is a hardware competition. So, all these people are trying to make devices for under $40 that a woman can wear, particularly-, they’re trying to solve the problem of women’s safety. When women are sexually assaulted in India, and they go to the cops, the cops come, but then the cops assault them. So, the answer is not more cops. So, the answer is some sort of citizen response. And so they saw what we had built, and they said, “Oh, jeez. Guardian Circle has solved the problem of how to assemble a flash mob of help, and how to create a citizen response. But they haven’t solved the problem of the panic button device.” When you’re under assault, an app’s not good enough. You need, like, a button on a ring, or a watch, or something like that. And so-, but that’s really hard to do, because you have to have a lot of battery power, a lot of resiliency, so when you bang it on the table, it doesn’t break, or you spill water on it. All that stuff. Hardware problems. So, somebody is going to build the device, somebody is going to win. The XPRIZE has said that they expect that they will get-, the government of India has committed to distributing a certain number of these devices. They believe it will be as high as 50 million people over 2018 and 2019. They’re hoping to get it as high as 400 million people by 2022. So, it’s a pretty big rollout to begin with, so, we’re just starting to plan that with them now.
ST:	That’s a really great partner to start with, and hopefully, many more to come. So, Mark, where can people find out more about Guardian Circle, and GUARDIUM.
MJ:	So, GUARDIUM, we’re in our token sale right now, and that is at tokensale.guardiancircle.com. The presale is happening at the moment, the public sale will be on January 22nd. If you want to learn more about Guardian Circle, or download the apps that we have today, because we do have working tech, unlike certain other folks I won’t mention, but, we have working things, and those things are at guardiancircle.com.
ST:	Brilliant. Mark, thank you very much for being on Blockchain Insider.
MJ:	Thank you for having me. Appreciate it.
[Break]
ST:	Thank you very much Mark, great to hear about Guardian Circle, and what’s coming in the future, certainly some interesting things around emergency response. And next, let’s get to our next interview, with Paul Forrest, of MBN Solutions, and Paul talks a little bit about the talent needs in the industry.
[Break]
ST:	I’m joined by Paul Forrest, from MBN, Paul, how are you, sir?
PF:	I’m very good, thanks, it’s great to be here.
ST:	Paul, from MBN, you guys look after the people and resource from emerging tech areas, at MBN, but you put out a study recently, with some, kind of, responses to some research, some questionnaires that you did in the blockchain space. Can you give me some highlights of-, of what you found?
PF:	Sure. So, we frequently put out surveys, which are designed to augment, or supplement, events that we put on, and we recently held the ScotChain event, which followed up from the CityChain event, at the start of the year. And as part of that, we tried to sample attitudes, and understanding what’s going on in the industry. So, really, trying to put something out which gauged the extent to which the business community was starting to grasp the mettle around blockchain, and what it might mean to them, at the same time as sampling with a relatively large community of tech players, in and around some of the more well-known blockchain ventures, to see what they thought was happening, and what that actually meant to them, their livelihoods, and their future. So, we had around 200 participants, it was a relatively broad survey, itself, it asked questions ranging from where we thought use cases might be in the future, what the dominant ask was, in terms of people looking at their innovation spend, over the next couple of years, and who was really gearing up to do something quite substantial. Given that we had a large community of FTSE 350 in the survey sample, it gave us quite an informed response, and we think it was an interesting set of answers, and one that we’ll focus on more with the future events that we conduct.
ST:	Useful to have the data. So, tell me a little bit about some of the-, some of the things that stood out to you from the responses.
PF:	Sure, well, there’ll be no surprises in there, in that, for many of the business community, they’re still struggling with “block what?” and the extent to which they have really understood what it might do for them, and what it might mean for them, and what it might mean, more importantly, for the competitive environment they live in, is-, is a bit of a challenge. And, for many of them, there are some quite dismissive remarks, coming in with the, “Well, you know, this is nothing new, is it? It’s just another tech fad, which is likely to lead to us spending a big chunk of change on something we don’t really need, and can’t really use.” However, and it’s an important however, there were statistics come in very firmly that suggested this was on the radar, and it was understood well enough, to have got them to the start line of saying, “Here’s some cash we’ve ring fenced, and over the course of the next 18, 24 or 36 months, we’re doing something. 
ST:	But it feels kind of resigned, doesn’t it? It’s like, “Oh, here’s another new tech. Oh, here’s a bit of money. Go figure it out, go see if my smart people, my kids in the corner, can do something with it,” versus really having a view as to what the value drivers of having market structure that’s decentralised, and pushing cost out of the organisation, pushing paper out of the organisation, the competitive advantages of being able to have supply chains that are transparent, or energy markets that are more transparent, or, to really unlock liquidity that’s stuck within supply chains, as one set of examples. People tend to talk about “tech for tech’s sake”-,
PF:	Yes.
ST:	Rather than value propositions. Did any value proposition, sort of, type responses come through for you?
PF:	Yeah, so the interesting thing was that they tended to be biased. So, if you picked the tech community who participated in the survey, it tended to be biased towards those things we would expect in and around fintech, possibly because that’s where the most mature set of practitioners were, at present, living, or certainly, at the time of the survey, were living. But, if you spoke to the business community, we were getting some quite interesting rankings around where the use cases were, and what they were focusing on. Smart contracts came out at the top of the list, habitually, so, people looking at it as part of the fabric of their business, rather than as a-, a go-to solution. So, people weren’t thinking, “Cryptocurrencies,” or, “Bitcoin,” they were thinking, “Smart contracts. How can this enable, or smooth out, the way in which we have a relationship with people who sit within our supply chain, or who sit within our downstream customer base?” We also had quite a lot of people looking at that whole supply chain transformation piece, and it was quite exciting that some of the larger companies in the FTSE 350 who participated were anchoring some of their blockchain ventures in and around supply chain reengineering or transformation. 
ST:	It does seem to be that one use case where people keep seeing value, because there are a lot of actors, a lot of countries, no obvious place to centralise, no obvious jurisdiction over that supply chain, so, therefore, something that allows me to have a workflow that operates across all of these actors in a supply chain, or across my  value chain, generally, and orchestrate technology, across all of those people, to have a straight through process across all of them, could be really exciting, especially if you’re dealing with the cost of paper getting lost on a day to day basis, and the legal fees, and the friction, and all of the challenges that are there.
PF:	Sure, and I-, and I think a lot of people, historically, traditionally, have had issues relating to global trade, and global supply chain becomes a bit of a challenge, when you start to look at some of the legal issues in there. We’ve had this wonderful legal instrument that’s existed for years, in and around Incoterms, which basically empowers and enables that international trade and transaction processing, but there’s been nothing, really, from a technological perspective, to underpin that, or support it, or to build that transparency and efficiency into it. Blockchain definitely offers the-, the promise of that.
ST:	Talk to me about talent. There’s definitely an explosion in new languages, new potential skillsets, the subject was born, almost by nerds, for nerds, but now we see that, as you say, the FTSE 300, there are companies that, arguably, are the non-financial ones, starting to reach around, looking for, “Do I have the right talent in the organisation?” Are they approaching this in the right way, and is the right talent out there?
PF:	Okay, there’s a few questions in there, so I’ll try and unravel one or two of those four you. So, the survey suggested that there was a lot of talent out there, however, when you delved down into some of the statistics, and some of the rhetoric, and some of the anecdotal comments provided, you realised quite a few people had had false starts here, and had been, dare I use the term, had been suckered in to making quite expensive hiring decisions, which had gone badly wrong, because they’d found people who came with the promise of understanding distributed ledger technology, to the extent that they could come in and just take the whole thing and get on with it, and, in reality, they’d probably done little more than familiarise themselves (? 57.13) the concepts of DLT and blockchain, but had come with a strong Java background, or strong coding background, and had jumped in feet-first to do something. Question mark what?
ST:	And I guess, also, this would have been, looking back, when you sent this survey out, when was the survey sent?
PF:	So, the survey was conducted over the course of Q1 and 2 this year-,
ST:	And so that would have probably been people’s experiences through 2016 and Q1, they were starting to reflect in that survey, and I guess, at that time, we were still seeing, Corda didn’t have a 1.0, Hyperledger didn’t have a 1.0, and a lot of the tooling that’s coming around the Ethereum platform has now matured significantly. And, indeed, as you say, the-, you almost did, at one point, need a hardcore, core developer, somebody who was very close to the underlying platform code of blockchain and DLT to achieve anything. That-, that may be changing now.
PF:	I think that is definitely changing, and, again, some of the rhetoric around tools, and use of tools, certainly for the proof of concept stage, suggests that that’s easing away, in terms of resourcing. However, there is still a fundamental resourcing gap, when it comes to that beast that most organisations struggle to find, and recruit, and retain, somebody who can operate as an effective bridge between the rhetoric that sits at board level, and what the techies can genuinely deliver. And that bridge is-, is missing in blockchain, largely because it’s still relatively immature, in the sense that we don’t have many battle-scarred veterans walking out of initiatives, where they’re able to say, “Well, this is why you need to think about these things in this way, and this is why you need to approach it this way.”
ST:	And I think the ones that there are, I look at Carsten Stöcker, who’s from Innogy, and RWE, I look at Alex Batlin, at BNY Mellon, I look at folks like our own Colin Platt, here at 11FS, who have been there and done it, and have had to explain it to the board, and have had to deliver those proof of concepts, and have had to try and plumb them in to real-world systems. There aren’t many of those people, and why would they stay-,
PF:	It’s a small audience, yes.
ST:	And why would they stay in one organisations? Because then they’ve become valuable, because that skill is extremely rare.
PF:	Yes. It becomes a commodity in its own right, but it will take time to become a commodity, and whilst you can make the most of it, being a high added value activity, why wouldn’t you?
ST:	Absolutely not. So, what advice are you giving to people looking for talent in this space at the moment?
PF:	Well, inevitably, it’s to look closer, because you’ll find that there are a lot of people, often in house, who have access to-, who have already grasped the mettle here, and they-, they really understand how to do something, but they’re-, they’re almost capable, willing resource, prepared to take that personal risk and dive in to something in this area, looking for a use case to get their teeth in to.
ST:	As somebody who was that person inside of a bank, I can say that that’s very likely the case, and I was really fortunate to have some fantastic bosses, who took me under their wing, and shielded me from a lot of the organisation, exposed me to other parts of the organisation, and really put me on their shoulders and said, “This is-, this is our person, we really want you to succeed.” And, again, I look at Amber Baldet, at JP Morgan, as somebody who’s in a-, in a similar position, still, inside an organisation, and many, many others, who I’m not naming, and should be. There are these people out there, but they all started as that person inside the organisation. And so, how do you marry that mixture of experience, externally and internally? Do you think there’s value in external experience, and where should you be looking for that?
PF:	Yeah, sure, I think there’s a lot of value in external experience, but I think, here, one of the challenges that we found in the survey was that the bit that is often missing, from some of the more technical resource, even where they’ve got time served, experience in and around blockchain ventures, it tends to be the domain expertise that’s necessary. So, actually, almost targeting resource on the basis of early stage proof of concepts in the areas and the domains where you’re looking to push in to. So, if you’re looking to-, to launch some form of healthcare venture, and that featured in our top eight use cases, then finding someone who’s got relevant domain expertise, and maybe done a little bit in and around some early stage blockchain development, is probably your starting point. Sadly, what that means is, you’re probably going to be cannibalising a fairly small community of people, and doing your best to raid the resources that other people are desperately trying to hang on to.
ST:	It feels like there’s a talent war coming.
PF:	I think it’s-, it’s-, we’re on the cusp.
ST:	Wow. Good to know. So, if people want to learn more about your survey, more about MBN, how do they do that?
PF:	You can visit our website, MBNsolutions.com, or you can follow our Twitter feed. We put out various slices from the survey on a regular basis, we talked about it at our last conference, at ScotChain, and we’ll be holding another CityChain event at the IBM headquarters, just after Christmas some time, Q1 next year, so, stay tuned for that.
ST:	We will look out for that, I did enjoy myself at CityChain. Paul Forrest, thank you very much for being with us on Blockchain Insider.
PF:	You’re welcome.
[Break]
ST:	A big thank you to Paul, and thank you to all of our guests, to Mark and Pete, and, of course, my regular co-host, G-Sass himself, Colin G Platt.
CP:	Thank you.
ST:	I hope you have a good week, Colin, listeners, so that you know, next week, we won’t be doing a news show, given it’s the Christmas break, but we’ll-, we’ve had two great interviews in the can, one with Tim Swanson, which will always be fireworks, so we do recommend you check that out, and if you like what you heard, please, please subscribe to our podcast, leave us a review on iTunes, those reviews help us so, so much. Spread the word, tell all your friends and colleagues to listen, too. We’ll have more Blockchain Insider next week. Goodbye.
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