A Blockchain New World
The last two weeks have all been about fintech, crypto and blockchian. I attended Blockchain Summit today.I will be remarking an event hosted by MaiCoin where founder of Etherium Vitalik Buterin will be giving a talk. Last week I was in Singapore for a couple of days and met with Stanley Young, former head of innovation at MAS. I was impressed by Singapore government’s drive to make the city-nation a global fintech hub. It is very clear MAS is on the driving seat in setting up policies, incentive programs and most of all attracting startups to set up shops there. I learn that one big question Singapore asks itself is: “how do we stay relevant to the region?”
Based off this question, policies and industry strategies are crafted in helping achieve the goal. There are a ton of activities going on in this space. Two weeks ago we saw more than 25,000 people turned up at Fintech Festival and hundreds of startups and investors joining.
Stanley and I talked broadly about how blockchain can become a changing force. Because of its denaturalized nature, the technology is enabling a new type of system-making. Imagine all the data intelligence is recorded on blockchain moving everything online in a transparent fashion. Think how medical data can be analyzed to create new readings about preventive drugs and diseases-detection. When manufacturing data is being logged on blockchain, we will see a new way of automated machine-operation with full stack of traceability. This could potentially reduce the likelihood of work hazard. Another major crack blockchain technology is able to fill is: AML (Anti-Money Laundering). Today’s banking frauds are created mostly by unparalleled information sharing or malicious human error. There is human nature played into this. Blockchain will do away with these negativities. With all transactions traceable and recorded real-time and non-changable, money flow will be made essentially transparent.
I do think blockchain and its related technologies will have far more implication to today’s world. Not just in the realm of financial world. More will come in political system, media, medical, academia, intelligence… and I believe countries that embrace this nascent technology rather than clamp down on it will have better edge in not being disrupted.
I recently gave interviews on how Taiwan can make impact in this space by turning itself an Asia Fintech Hub. Please see here. Since China and South Korea banned ICO, Taiwanese government has taken a lenient approach. It is a good sign. As a legislator and member of Parliament, I think three we can do to ensure Fintech startups can start to take shape here in Taiwan.
- Radical openness: Government can open up a host of opportunities by harnessing data. Obviously, there will be privacy and security issues but some sort of framework must be created to enable data use for safe business.
- Experimentations: Legislative Yuan has just passed committee review for Financial Technology Experimentation Act, which I have participated and championed. This is usually called “regulatory sandbox”. It’s a good sign but not enough. Legislation is the first step but more needs to be done. We should actively set up investment schemes, incentive programs, fintech hubs, accelarators, incubtors and encourage banks to invest in smaller startups. We should actively make a statement to the world that Taiwan is open for fintech!
- Re-regulation: I won’t talk about de-regulation when it comes to fintech, blockchain, crypto and ICO. I believe on a higher level regulatory reform needs to be done. It’s not about de-regulating but re-framing. Reg tech needs to happen in order to pave the foundation for all existing infrastructures to be transformed digitally. This is considered top priority as most fintech activities are poised threatening to existing banks. It needs to happen on top regulatory level to change the system is designed and implemented. Reg tech is crucial to success of fintech.
Some of the important questions we should be asking:
What is the future of regulation? How will the role of central bank be shifting? What does it mean for growth? What does it mean for jobs?
We need to ensure regulations are also innovative!
Never before in history do we see a technology so disruptive that it could potentially rewrite the playbook. With all the hype surrounding this topic, caution must be exercised. I advocate for open and fair use of technology and empowerment to all. If done well, a new world is on the rise — a world powered by blockchain that enables a decentralized and democratized participation, with promise of equal opportunities. Taiwan can be forefront on this and I am committed to making it happen!