Why The Travel Industry Is Blockchain’s Best Bet

In 2017, blockchain projects flourished, where ICOs managed to raise billions. 2018 was a crash year for cryptos, even though the sums raised this year were twice as high as the previous one. Blockchain projects promised a lot, however 71% of them still have no working products. The argument was that blockchain is still in its infancy, and many are supposed to deliver their products in 2019. And one of the best places to watch where blockchain will rise again is in the travel industry.

Problems we face

The travel industry is uniquely suited to benefit from blockchain. There are many different players involved, and all need to collaborate seamlessly. When someone wants to travel, they need to deal with airlines, book hotels, find activities, navigate airports and maybe rent a car. They will also have to change their currency so they can shop at their destination.

The hoteliers and airlines also need to collaborate (and compete). Besides running their own website and reservation systems, most of them have found it necessary to collaborate with Global Distribution Systems (GDSs) and Online Travel Agencies (OTAs) to land on more “supermarket shelves” globally. Running these systems adds to the costs on the end customers, but there are also many other hidden fees involved.

For one, we must consider the transaction fees and inefficiencies in the finance and banking industry, especially when different parties from different countries are involved. Another problem is the setup and integration costs that are involved when service providers need to synchronize their disparate, siloed databases. A standard travel-related transaction involves multiple service providers, from GDSs and bedbanks to end-service companies and eventually point-of-sale players. Third, we have the GDPR and the importance of security and privacy. Fourth, we have the problem of fraud, which costs the airlines $1 billion annually.

Finally, we have the “invisible costs.” Services like the GDS are costly, especially for smaller players. This makes the entry barrier significantly higher for them, which means many innovative startups are left in the dark. In addition, the data held by GDSs can be expensive and inaccessible for hoteliers, who could otherwise have more distribution options. Expedia and Priceline have a 93% duopoly, which according to the American Hotel & Lodging Association “hurts consumer choice and the small businesses in our industry, which represent some 60 percent of all the hotels in the U.S., who are struggling to compete as a result of the gouging commission rates charged by the [online travel agencies].”

Blockchain disrupts the duopoly

Blockchain removes the intermediaries and offers a decentralized system where different parties can interact without needing to trust each other, removing a lot of overhead. This has produced real results.

“Our project has outperformed the market with +200% during the bearish market,” says Nikola Alexandrov, founder of LockTrip.com, which offers global coverage to about 100,000 hotels. “The prices on our marketplace are on average approximately -19% cheaper than the cheapest alternativebooking.com.” He continues: “our prices are so cheap, we are not allowed to advertise them in Trivago.”

But the lower costs are just one of blockchain’s benefitsthere are many more.


Rita Hunter was sentenced to jail over 14 charges of fraud. Her fake travel company charged people for flight and accommodation services without actually booking them, leaving them out of pocket and without the holidays “they looked forward to and worked hard to pay for.” This is no limited incident.

According to Barry Gooch, chairman of the Prevention of Fraud in Travel campaign, “a significant issue for the travel industry has been the way criminals have been able to commit fraud as a director of one company that is a member of a consortium, then move to another and commit fraud again because there has been no established, legal method of sharing such information.”

Blockchain offers the ideal solution for these cases with smart contracts. As Alexandrov explains, “each booking is locked into a smart contract until the moment of check-out. This gives unparalleled security for the traveler compared to traditional bookings (where once they pay they have no guarantee that they will get the service which they paid for).”

Obstacles and solutions

However, GDS companies claim they offer more services and real-time pricing for distribution than blockchain ever could.

“There will always be a need for someone to aggregate offers and enable multi-sourced shopping. I don’t think blockchain resolves that,” Philip Likens, director of Sabre Labs, told Reuters. Representatives of Amadeus, Travelport and SITA echoed his comments.

Tony Hird, VP Enterprise Business Architecture at Travelport also pointed out another problem: “You can’t have a real-time environment if you have to wait 10 minutes for the transaction to be committed.”

The third problem is the nature of cryptocurrencies: it currently has a learning curve and requires some levels of technical understanding, which keeps it from mass adoption.

Recently, Michael Culhane, CEO of TripX LLC announced it has resolved the security, transaction speed, and compliance problems that have led large enterprises in the travel industry to hold off on the deployment of blockchain solutions. The platform, which is available on a “test” network, allows for a 10-minute registration process and the payoff of commissions being received same-day.

Without blockchain, the cost and complexity of deposits, invoicing, batch processes and reconciliation processes could stretch payment and commission settlements between 30 and 90 days. Culhane estimates that for most large enterprises, such savings could translate to a full percentage point on their EBITDA.

As for the “learning curve” problem, LockTrip is offering a model where users can pay with their credit cardthe system will automatically purchase the necessary tokens on crypto exchanges. Users do not feel like they are using cryptocurrencies as everything is taken care of behind the scenes.

Predictions for 2019

The industry benefits greatly from blockchain adoptionbut it also seems to be the path the customers are taking. According to predictions from Phocuswire, while Expedia and Booking.com are trying to be a one-stop shop for consumer travel purchases, consumers love to shop around. They like deals, they like to read reviews and they like to get recommendations from their friends. For these reasons, the path they take can involve hundreds of searches across a wide range of sites and apps. The trend will be moving away from centralized portals to find the best deals, and here is where blockchain can make a difference.

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Blockchain Could Make Our Food Supply Much Safer

Blockchain can make food shipping faster and pinpoint contaminated food before it is sold.

5 min read

Opinions expressed by Entrepreneur contributors are their own.

Over the past month, consumers witnessed a series of food distribution disasters: Romaine lettuce was recalled across 11 states and Canada after more than 30 people reported illnesses; approximately 6.5 million pounds of various beef products was flagged for possibly containing salmonella; and more than 89,000 pounds of ready-to-eat ham products were recalled due to a listeria contamination.
In 2017 alone, there were more than 400 recalls issued by the U.S. Department of Agriculture and the U.S. Food and Drug Administration. The same year, the U.S. Department of Agriculture recalled more than 20 million pounds of product.

The solution to these contamination problems isn’t years away. It’s here now, and many businesses are already implementing it — blockchain technology.  Wal-Mart, for instance, is already using blockchain to track all lettuce shipments to its more than 6,300 stores. And by January 31, 2019, all direct suppliers of lettuce will be officially required to use blockchain to track lettuce from farm to shelves.

Related: Why Blockchain Belongs in the Courtroom

Blockchain allows Wal-Mart to trace their products at each step of the shipping system, following the product from the factory floor to an individual truck to an individual store and, ultimately, to specific consumers. Tamper-proof sensor inputs and records mitigate the risk that food will be stored in improper conditions. Furthermore, the use of smart contracts expedites the loading process, which in turn alleviates the manual process that would otherwise take hours. This shortens the window that food could be exposed to improper environments and lowers the risk of contamination.

Not only does this streamline an outdated shipping network, reducing waste and saving both the company and the consumer money in the process, but blockchain could help pinpoint the exact distribution of soiled products. Over Thanksgiving in 2017, Cargill piloted a blockchain program to allow consumers to see where their Turkey came from — literally from farm to table. Enter the ID of your turkey on a website, and see everything from where it was raised, to the path it took to the store. Increased visibility allows for increased granularity, reducing the risk that every single product nationwide has to be destroyed, and reducing the risk of people consuming tainted food solely due to the fact that we have no idea how to separate the tainted from the safe. Even if we can’t identify it down to single units due to items being picked in bulk (think of apples in a bin when it isn’t feasible to label each), but we can increase the visibility through smaller, more detailed lot tracking.

Related: Heck Is Blockchain? Watch This Explainer Video.

Wal-Mart now can track records of loads, geo-waypoints and other basic information to know the specific locations of tainted products and pull them systematically. The result: Wal-Mart says that blockchain technology has reduced their tracing efforts from days to seconds, which reduces consumer exposure to tainted food.

The risk, however, is that other retailers won’t want to play nice with Wal-Mart’s blockchain system. Why would they turn over their supplier and supply chain information over? This puts producers, manufacturers and carriers in a bind, because of the risk of needing to adopt multiple fractured systems without standardization. Many, including myself, believe that independent, permissionless, public blockchain systems like Ethereum are the answer to this problem.

Government, on the other hand, has been slow to update its response, leaving consumers with the same dysfunction — the initial report of the contaminated product, ambiguity regarding where the product was shipped and confusion about who is impacted. The result: grocery stores frantically pull items from shelves, often far too late in the process. Consumers anxiously question whether the items in their own freezers are safe and, and worst of all, people get sick.

Related: Blockchain Is How We Can Protect Our Privacy in a World of Ubiquitous Surveillance

This outdated system fails in two key ways: first, it creates waste, with individuals outside the contamination zone throwing away good products out of fear; and more important, it creates widespread hysteria, the opposite of what any sound public health notification system should do. More information helps quell the fear, and provide peace of mind.

In response to these growing challenges, the F.D.A and the Department of Agriculture have touted a new policy in their consumer-protection efforts: name retailers, in addition to the contaminated product, in their public announcements. But this additional step still paints too broad a picture and does nothing to solve the core problem of providing consumers the information to understand whether the product they purchased is tainted or safe.

We live in a time where available technological solutions can streamline national and global shipping logistics while helping to protect people’s lives. Blockchain technology is the way of the future, and we will all be healthier and have a little more peace of mind because of it.

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South Korea Examines Blockchain for Shipping

Blockchain has been steadily making inroads in the B2B realm as a way to help boost supply chain transparency and efficiencies.

To that end, in South Korea, a number of government ministries are looking into blockchain, eyeing the potential boost distributed ledger technology can give to marine logistics.

As Coindesk reported Tuesday (Dec. 18), the ministries include the Ministry of Science, ICT and Future Planning and the Ministry of Oceans and Fisheries. The two departments have launched a joint blockchain project, presaged over the summer, that is geared toward container shipping and explicitly on improving transparency between parties. The transparency is tied to sharing data about imports and exports in real time.

The trial is being conducted at the southern port of Busan through the next year and will be expanded to other locations in the country. The government is investing $9 million across a series of blockchain initiatives that in addition to the aforementioned, port-focused one, include customs clearance, cross-border e-documentation and livestock supply chain management.

As has been reported, the Korean Bar Association has urged the government to put blockchain regulations in place. Coindesk reported that a doubling of blockchain pilots may be seen in the public sector through the next year, and there may be three private national blockchain projects in the offing.

Separately, a report from New Zealand’s innovation agency, Callaghan Innovation, has said there can be growth in the country’s largest export if firms leverage blockchain. CCN reports that the agency noted that IT in the country employs 100,000 people and generates as much as $16 billion New Zealand dollars each year in revenue. The blockchain sector can boost results in supply chains among other sectors, said the report — but blockchain focused firms must have access to banking services.

Thus, regulators must work with the banking industry, according to the report, which noted, “The Reserve Bank [of New Zealand] and the Financial Markets Authority could give consideration to producing guidelines to support a level of auditing appropriate to the risk exposure of individual blockchain companies, avoid blanket de-risking, and ensuring compliance costs are not onerous.”

In terms of individual company news, as reported by CNBC, McKesson’s Change Healthcare announced the acquisition of PokitDok, which has a presence in blockchain for the healthcare sector.

The site noted that Change may announce a deal later in the week. The startup helps other firms access APIs that in turn work with health firms and their systems. Such syncing works across billing activities, for example. PokitDok has agreements in place with companies such as Amazon and Intel, as announced last year, looking to scale such services.

Details of the acquisition were not announced, but as Health Data Management reported, the integration of the PokitDok APIs will help with new capabilities across digital health initiatives. The site quoted Kris Joshi, executive vice president and president of network solutions for Change as stating that “as the leader in blockchain for healthcare and with one of the most extensive open API marketplaces available, with PokitDok we are bringing together synergistic assets and technical expertise for delivering additional capabilities to our customers and accelerated value to digital health markets.” Change is 70 percent owned by McKesson.



Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out the latest PYMNTS report on healthcare digital identity. 

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Blythe Masters steps down as CEO of blockchain startup Digital Asset

Blythe Masters, chief executive officer of Digital Asset Holdings LLC.

Simon Dawson | Bloomberg | Getty Images

Blythe Masters, chief executive officer of Digital Asset Holdings LLC.

Blockchain startup Digital Asset’s chief executive officer and one of the most prominent supporters of the distributed ledger technology on Wall Street, Blythe Masters, is stepping down after about four years in the role, the company said on Tuesday.

AG Gangadhar, a former Uber executive who joined Digital Asset’s board in April, has been appointed as the chairman and will serve as the acting CEO while the company looks for a new chief executive, it said.

Blockchain, which first emerged as the software underpinning cryptocurrency bitcoin, is a shared record of transactions that is maintained by a network of computers on the internet.

Masters, a former JPMorgan banker, led Digital Asset through its global expansion and helped it raise millions of dollars including from some of the world’s largest banks.

Masters will remain as a board member, strategic advisor and shareholder, Digital Asset said.

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Vodafone, Huawei, Intel and friends form blockchain industry group

The European Telecommunications Standards Institute (ETSI) is getting into the blockchain game, having just set up a new “industry specific group” aimed at exploring the viability and potential of blockchain technologies for various industries.

Founding members include Ericsson, Huawei, Intel, Telefónica, and Vodafone. These industry players will specifically examine the use of permissioned distributed ledgers, ETSI announced yesterday.

The new ETSI group will try to understand the challenges of using permissioned distributed ledgers in business applications. ETSI hopes that the group will be able to develop industry standards for the use of the decentralized technology, including interfaces/APIs/protocols and information models.

Indeed, one of the biggest challenges when using decentralized or distributed technologies in cross-business settings is standardizing processes and workflows in a way that works for all the involved parties. Otherwise it’s likely to create more problems than it solves.

The work group will have its first meeting on January 24, 2019 at Telefónica, Madrid, where it will discuss project priorities and elect representatives from each of the participating companies.

ETSI isn’t the first telecommunications firm to look into blockchain tech. Earlier this year, British telecom regulator, Ofcom, announced it was exploring the technology to help manage the nation’s database of available telephone numbers.

Published December 19, 2018 — 10:52 UTC

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Wednesday’s blockchain news, from Asia and beyond

It will take a tech giant to kick start blockchain: While the likes of Amazon and HTC have carried out blockchain projects, the reality is no tech giant has yet done the full deep dive into the new technology. A new opinion piece from Fortune argues that it “going to take a tech giant like Apple to make blockchain payments work at scale.” The article says that Apple “could leverage its existing relationship with media outlets to install a blockchain system behind the scenes, and kick-start adoption by providing free tokens to its vast user base.” While the Fortune piece admits this is all pure speculation about Apple, the piece does point out that Facebook, Microsoft and Google are all working on some kind of crypto-based payment solutions.

China’s crypto’s past, present and future: An interesting new report published by Nasdaq reflects on the country’s digital currency development, from being the ‘Wild West’ of the crypto world to now overseeing the world’s largest and most regulated blockchain ecosystem. At the beginning of 2017, says the report, 80% of all blockchain currency transactions were conducted in RMB and the majority of the world’s crypto mining activity took place in mainland China. Today RMB transactions make up barely 1% of the global trade volume and the majority of world’s crypto mining operations are in Siberia. However, China has not just fully-embraced blockchain but, claims the report, Beijing’s financial overlords have always been admirers of crypto-currencies, as a “secure online trading unit” that has “clear advantages,” and the report concludes that “it’s only a matter of time until this tug-of-war between China’s government regulators and online traders finds a new field.”

Busan Port starts supply chain blockchain trial: South Korea’s Ministry of Science, ICT and Future Planning, together with its Ministry of Oceans and Fisheries, has started a year-long pilot blockchain project at the Port of Busan to see if the technology can make supply chains more transparent, faster and allow for shipping data to be shared securely and in real time. The Port of Busan is the biggest in South Korea and the fifth busiest in the world and if the project is successful, the blockchain initiative will be rolled out in ports across the country.

Crypto gets the Hollywood treatment: According to the Hollywood Reporter, a group of movie companies have formed the Blockchain Global Entertainment Alliance, a non-profit focused on promoting blockchain technology in the global entertainment industry. Blockchain alliance member Rouslan Ovtcharoff from Millennium Media told Hollywood Reporter: “It has the potential to fundamentally change the way our business is conducted in addition to helping us solve the piracy problem.”

Blockchain industry decline, what a difference a year makes: This time last year, reports CNBC, Bitcoin was approaching $20,000, its highest price point, and blockchain jobs were booming. Today Bitcoin is hovering around $3,300 and the blockchain sector is seeing huge job losses. CNBC says data shows “a massive increase in the number of crypto-related jobs posted in 2017 followed by a slump in 2018” and says that blockchain services company Consensus has cut 13% of its staff, while Steemit, a blockchain start-up, recently announced it was laying off 70% of its workforce. So what will next year bring?

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Can blockchain break shackles of 40 million people caught in modern slavery?

When the topic of blockchain comes up, most people think of cryptocurrencies – something that Mark Blick, head of government solutions at Diginex, would like to change.

Can blockchain help soccer fan Jason Sze democratise ‘the beautiful game’?

A global blockchain solutions and financial services company headquartered in Hong Kong, Diginex offers digital asset management and infrastructure support for blockchain transactions, along with custom blockchain solutions.

Modern slavery affects an estimated nine million new people every year, which is roughly 25,000 every day – or one new slave every four seconds

Mark Blick, head of government solutions, Diginex

As part of this, the company works with governments and NGOs around the world to help design and implement complex public sector blockchain projects across a wide range of applications.

The company has teamed up with the anti-slavery organisation, The Mekong Club, in using blockchain-enabled systems to identify and eradicated supply-chain inequities to help the more than 40 million people – many of them migrant workers – who are trapped in modern slavery, working in low-paid sectors such the garment industry.

Slavery, forced labour and human trafficking are hot topics, but the process is often contractual, which allows a distributed ledger – a digital system where records of currency transactions, usually using bitcoin or similar cryptocurrencies, are simultaneously maintained at multiple points throughout a network – to provide a solution.

It will allow the contractual details and the workers’ whereabouts to be properly recorded on blockchain for everyone to see.

“We are using the technology to solve specific inequities within modern slavery, particularly around contracting and transparency around fees,” Blick says.

“That is where blockchain can be very effective – in providing transparency and security around data.”

Why millennial former equity trader has plunged head first into cryptocurrency exchange

Diginex and Mekong Club’s pilot project works with the likes of the UN, NGOs and academics to find out how a distributed ledger can best combat slavery, child labour and unfair working practices, in addition to building blockchain-enabled voting solutions for governments and organisations.

We are using the technology to solve specific inequities within modern slavery, particularly around contracting and transparency around fees

Mark Blick

The project is using data to help companies track the migration of workers and compile the associated costs forced upon workers.

By teaming up with NGOs on the ground who understand the key issues, along with academics and auditors, the project will create a mobile app to ensure contracts and documentation are being maintained in their original form to stop migrants from falling into the modern slavery trap.

Migrant workers – frequently vulnerable to outside parties – are often subject to changes in employment contracts while moving from one country to another, or simply not allowed access to their original contracts upon arrival at their guest country, resulting in lower pay and longer hours.

They are also regularly charged extortionate fees for transport, accommodation and recruitment, or have their passports and identity documents taken from them.

As a result, they are often forced to borrow money from the very people cheating them, creating a greater degree of debt and slavery.

Blick, who used to work at Gerson Lehrman, an online professional learning platform, and also spent seven years in the oil and gas industry, says: “Modern slavery affects an estimated nine million new people every year, which is roughly 25,000 every day – or one new slave every four seconds.

“There are currently more people affected by modern slavery than there are people living in Canada.

“Despite the great efforts of many people, only 0.2 per cent of these victims are helped every year.”

He says: “We are hopeful that blockchain can offer trust, especially in contracts between migrant workers and companies and their agents, along with transparency around the fees, [and] security around the whole employment journey.”

There are more people affected by modern slavery than there are people living in Canada … only 0.2 per cent of victims are helped every year

Mark Blick

One advantage of using blockchain for such a project is that it will be able to take various sources of data and create a picture of the wider linkages within supply chains.

So far the partnership is focused only on looking at the garment industry, which has been in the spotlight for its exploitative practices ever since the 2012 fire at the Tazreen Fashions factory in Dhaka, Bangladesh, which killed more than 100 workers and injured at least 200 others.

The idea of building principled supply chains has also gained momentum following the Modern Slavery Act 2015 enacted in Britain, which has been adopted by nations worldwide.

“People want to know that their products are ethically sourced within a responsible supply chain,” Blick says.

“If companies are discovered to be abusing human rights, it can be disastrous for their reputation as well. It’s why traceability of labour contracts is so crucial.

“Blockchain provides a single source of truth – allowing access to the same contracts provided to every other stakeholder.”

The idea can be expanded to the mineral and electronics industries, and Diginex is also considering a pilot scheme for people who have been forced to move as slaves.

“What blockchain does is it creates a corridor of integrity – giving good actors and companies a ‘beachhead’ to work to – and an understanding of which employment agencies are legitimate and which are corrupt,” Blick says.

Distributed ledger technology is considered by some people to be a quiet revolution bubbling under the surface, but he remains cautious.

“We are not at the point of mass adoption, but certainly that of no return,” Blick says.

If companies are discovered to be abusing human rights, it can be disastrous for their reputation. It’s why traceability of labour contracts is so crucial

Mark Blick

“Many companies may not entirely understand blockchain, but most people I talk to realise its transformative nature.”

The cryptocurrency bear market has seen many retail investors lose their shirts in 2018, with drops in the market of more than 70 per cent.

Yet has this created doubt about the effectiveness and viability of distributed ledger technology?

“One of the biggest applications of blockchain is purpose-driven projects at scale, and this has nothing to do with speculative cryptocurrencies,” Blick says.

“The ability to prove trust, transparency and security around contracting and around fees is worthy and has longevity.

“Now we have institutions like the World Bank backing blockchain, and leaders like IMF [International Monetary Fund] managing director Christine Lagarde becoming enthusiastic about digital assets, so the future is here.”

Diginex also hopes to use blockchain in the electoral and demographic process – a concept that has seen a few small trials carried out around the world by other parties – and the company is currently in talks to implement its nascent projects.

“We are looking at transparency, integrity, privacy, affordability and accessibility,” Blick says.

“Most electoral systems touch only about two or three out of five of those, so if you tick all the boxes that’s the perfect electoral system.”

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How Industry-Government Collaboration Can Drive Blockchain Adoption

In Australia, the private sector is working with regulators to maximize the benefits of blockchain technology and minimize its risks. 


Over the recent years, a growing number of public and private sector entities have been exploring the use of blockchain technology to develop products and services and to improve business processes. Most efforts, however, have focused more on the technical aspect, overlooking the need for a legal and regulatory framework. As the application of blockchain is still in its early stage, engaging policymakers and regulatory bodies is critical to ensure that appropriate regulations are in place.

During a one-day workshop at the Asian Development Bank, Nick Giurietto, CEO and managing director of the Australian Digital Commerce Association (ADCA), shared their experience in Australia in engaging and influencing policymakers to create an enabling environment for blockchain innovation.

ADCA is the industry body that represents Australian businesses participating in the digital economy through blockchain technology. It encourages responsible adoption of blockchain technology by industry and government across the country as a means to drive innovation in service delivery for all sectors of the economy.

The Need for Appropriate Regulation

The potential of blockchain to offer a secure, transparent, accurate, and immutable way to manage transactions can improve the way businesses and organizations work. Governments will play an important role in shaping how blockchain will evolve. Policies and regulations must harness the opportunities and address the challenges that the technology presents.

Cyber-security and data privacy are among the issues that regulations must address. The increasing value of data has raised questions on data protection and ownership. At the same time, the use of online platforms has made businesses vulnerable to cyber-attacks. Digital products and services should be designed and developed with regulatory, cyber-security, and data privacy compliance integrated on the outset.

However, lack of understanding can cause governments to issue regulations that will discourage the use of blockchain and stifle innovation. This was initially the case in Australia. The Australian Taxation Office (ATO) regarded digital currency as a commodity (not money). As such, under the Goods and Services Tax (GST) rules, bitcoin would be subject to double taxation—first, when exchanging Australian dollars for bitcoins, and second, when using bitcoins to purchase actual goods or services. Thus, consumers ended up paying GST twice. This put digital currency-related businesses at a disadvantage. It had the unintended consequence of causing two Australia-based bitcoin exchanges to move to London to avoid double taxation.

Some governments have even gone as far as to issue bans on cryptocurrencies and initial coin offerings (ICOs) due to the growing number of scams and illegal activities associated with them. This is not the most sensible approach as bans very rarely work in the regulation of an industry. Instead, governments must recognize the benefits and problems, and find a way forward.

Getting Regulation Right

Being on the receiving end of these regulations, private-sector stakeholders must be proactive in influencing the regulation of the blockchain space. ADCA’s approach was to establish a relationship with regulators and to undertake education and policy engagement with policymakers, lawmakers, and other key decision makers. ADCA helped to clarify issues for government and to bridge the gap with businesses. For example, with the double taxation issue, ADCA started discussions with tax authorities, explaining how bitcoin works and why it shouldn’t be subject to GST. As a result, as of November 2017, tax rules have been changed so that digital currency is no longer considered a commodity.

Another approach is through self-regulation whereby the private sector organizes itself to ensure adherence to industry standards. With private sector taking on this responsibility, unnecessary government interference and questionable regulatory legislation can be avoided. At the same time, it can resolve the issue of lengthy government processes and weak enforcement.

ADCA initiated the development of the Australian Digital Industry Code of Conduct to help consumers identify digital currency businesses that have best-practice standards in place. The Code covers fit-and-proper-person test, consumer protection, and anti-money laundering/countering terrorist financing (AML/CTF). Companies must pass an external audit before receiving a certification of compliance with these standards.

In developing the Code, a consultative approach was followed to secure support and buy-in from stakeholders. Key regulators were included in the discussion to gather their feedback. In the process, ADCA was also able to educate regulators and help change any negative perception of blockchain. More importantly, ADCA earned the right to be involved in the formal regulatory process that came after.

Coordinating Mechanisms

Instituting mechanisms and structures can help facilitate industry and government engagement. ADCA established the Industry Advisory Council, which is composed of respected business leaders that are interested in blockchain and blockchain entrepreneurs. By bringing these parties together, the private sector, as one body, can approach key government officials to influence the regulatory perspective. ADCA also facilitated the creation of the Parliamentary Friends of Blockchain. Patterned after a similar body in the United States Congress, Parliamentary Friends is composed of bipartisan members of the parliament who believe that blockchain is an area of national importance. The members engage in dialogue on how to move forward the adoption of blockchain technology in Australia. The group also serves as a channel between industry stakeholders and members of parliament. To date, 37 out of 225 members of the federal government have signed up to be part of the group.

New Regulatory Models

RegTech refers to the use of technology in the in the context of regulatory monitoring, reporting, and compliance. In this regard, ADCA has been thinking strategically in terms of how blockchain can transform regulation. Blockchain has the potential to create an entirely new regulatory model, moving away from burdensome reporting towards a scenario where only compliant transactions occur in the first place. This can be done through the use of smart contracts so that a transaction only takes place when certain conditions are met. Alternatively, the regulator can become one of the nodes in the blockchain that can view all transactions subject to policy rules. It will be up to the regulator to monitor the transactions for suspicious behavior.

For example, if transactions in the stock exchange are placed on the blockchain, tax authorities could have smart contracts that assess transactions and calculate any tax obligations that may arise. Further, by using smart money, these obligations could be remitted to the treasury department in near real time.

Another use case would be in anti-money laundering. Blockchain can be used to record the fact that know-your-customer checks were carried out, the data relied upon, and the provenance of data. The record can serve as proof to regulators that due diligence was conducted.


Australia, together with Singapore and Switzerland, is one of the leading jurisdictions that are studying blockchain regulation. The key is to have a joined-up regulatory response by creating a system among different regulators and stakeholders affected by the technology.

Supervisory and regulatory frameworks should enable innovation while ensuring stability, consumer protection, and competition. This can be best achieved through clear and active collaboration between regulators and industry players.


A. Lewis and H. Roxas. 2018. Promoting Financial Inclusion through Distributed Ledger Technology. Development Asia. January.

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CY Park, J Villafuerte, and B Zhao. 2018.  Harnessing Technology for More Inclusive and Sustainable Finance in Asia and the Pacific. Manila: Asian Development Bank. 

D. Arner, J. Barberis, and R. Buckley. 2017. How RegTech is Helping Banks Manage Risks. Development Asia. June.

J. Thompson. 2017. Using Blockchain to Improve Aid Transparency and Efficiency. Development Asia. May.

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  • Nick Giurietto
    CEO & Managing Director, Australian Digital Commerce Association (ADCA)

    Nick Giuriettois a B2B marketing and product professional. He has held senior management roles with Gartner subsidiary CEB, Experian Australia, the federal government’s export credit agency Export Finance and Insurance Corporation, and telecoms company AAPT. He is a founding member of the Global Blockchain Forum and a member of Standards Australia’s Technical Working Committee on Blockchain and Distributed Ledgers. 

Leave your question or comment in the section below:

   Last updated: December 2018


The views expressed in these articles are those of the authors and do not necessarily reflect the views of the Asian Development Bank, its management, its Board of Directors, or its members.

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Nigerian Lottery Company Partners with Quanta to Introduce Blockchain Powered Lottery

Naija Lottery recently announced its partnership with Quanta, in a bid to introduce blockchain technology to the traditional lottery market.

Revolutionizing the Lottery Industry Using Blockchain

According to The Punch, the International Lottery and Gaming Limited (ILGL) also known as Naija Lottery, partnered with a new investor, Quanta, to introduce a blockchain investment platform. Per the agreement, the coming together of both companies would bring decentralized ledger technology (DLT) to the traditional lottery market.

Commenting on the partnership, Charbel Saadeh, who is the Managing Director of Naija Lottery, said:

Now is the time to build on the momentum of the traditional Nigerian lottery market. Together, we will continue to build a safe and trustful platform that ensures fairness and transparency, while offering amazing functionality to players and helping to boost the local economy.

Saadeh further said that the company aimed at offering a better lottery experience for the Nigerian market.

Also commenting on the collaboration was Kostas Farris, Chief Technology Officer and Director of Quanta. Farris said that the partnership of both companies was an opportunity to boost the dynamic lottery industry. The Quanta executive further stated that the company aimed at spreading blockchain lottery across other markets in Africa.

Naija Lottery which is one of the largest gaming companies in Nigeria offers lottery tickets across the country. Part of the company’s objectives includes offering responsible gaming according to international standards and preventing addictive playing. Naija Lottery has a Grade A license from the National Lottery Regulatory Commission.

Quanta is renowned as the world’s first licensed blockchain lottery and developed on the Ethereum decentralized ledger technology. The company aims to transform the traditional lottery industry by providing a safe and transparent environment for both players and operators.

Blockchain Technology Penetrating the Online Gaming Market

Different sectors use blockchain technology as it does not involve a middleman and is transparent. The Online gaming industry including lottery companies and casinos also employ decentralized ledger technology to bring about fairness and take the industry to the next level.

DAO.Casino in November announced a partnership with BlockProof Tech LLC to revolutionize the gambling industry with Gambling 3.0. The casino company aims to build a decentralized protocol for gambling on Ethereum blockchain. This process would improve interaction and create better opportunities for operators, affiliates, game developers and players.

Earlier in the year, VR Technology created the VR Casino OKO which aimed to solve the problem of transparency using blockchain technology.

Image courtesy of Shutterstock.

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Dismiss the future of Blockchain at your own peril

There are two reasons to consider investing in blockchain says Dr. Demetrios Zamboglou as he ponders the future of blockchain Dismiss the future of Blockchain at your own peril image

Dismiss the future of Blockchain or struggle to hang on

There are several factors that will heavily influence the future of blockchain technology. Probably the most important one is government regulation, especially considering cryptocurrencies. It is not a secret that blockchain is still underregulated, causing many problems including a lack of security in the cryptocurrency markets.

Some assert that blockchain is fundamentally incompatible with existing legal and regulatory models.

  • Scientists raise important questions concerning identifying data controllers and processors, controller and processor relationships, international data transfers and data minimization, and data subject rights.
  • Others question whether blockchain should be considered as an asset or as a payment system? And can it be used for proof, confirmation, or validation of legal transactions?

Recently Hackernoon revealed the range of agencies that governments are using to try and regulate blockchain. For example, the European Union is using its General Data Protection Regulation (GDPR), while the United States is using its Securities and Exchange Commission after determining that cryptocurrencies should be considered as “assets”. Some East Asian countries have simply banned crypto outright.

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Yet, despite the uncertainty of future regulations, there are two reasons why investing in blockchain technology is considered worthwhile in time, money, and other resources. First, although blockchain initially requires a significant amount of energy, it is believed that over time this technology will reduce costs for companies and help profit centers increase their gains. According to the report Banking on Blockchain: A Value Analysis for Investment Banks, blockchain “might reduce 70% potential cost savings on central finance reporting, 30-50% potential cost savings on compliance, 50% potential cost savings on centralized operations and 50% potential cost savings on business operations (roughly $10 billion in annual cost savings).” Granted not everyone shares this optimistic view.  For some the future of blockchain is bleak. They argue that blockchain is cost-prohibitive because, besides the significant power costs involved, issues such as increasing overall costs per transaction (due to the blockchain necessity of multiple processing nodes scattered across multiple participants) and increasing storage requirements are unavoidable.  Plus, none of enterprise blockchain initiatives up to this point have been proven to reduce costs dramatically. Nevertheless, despite the credible objections to blockchain that have been raised, it is plausible to suggest that the distant future of blockchain technology, will see  applications will prove more cost efficient than traditional applications because of their higher potential.

Don’t let blockchain hype become your excuse for inertia – blockchain supply chain can ensure trust

Is blockchain coming of age? Maybe we are moving beyond the hype associated with cryptocurrencies, and onto a real world of practical applications, such as ensuring trust between digital partners, with blockchain for the supply chain. Then again, Gert Sylvest, of GM Tradeshift Frontiers says that we must be realistic, blockchain on its own is not enough.

Second, and most importantly, blockchain is worthwhile because of its adaptability. There are many blockchain technology applications in business, and because of its adaptability, blockchain changes the business models of industries. For example: Smart Contracts.  Ethereum is a computing platform which enables complex processes to be handled, including asset transactions involving more than just one party with the involvement of several types of assets (e.g. money, land, rights etc.) through smart contracts. Respected attorney Gönenç Gürkaynak has highlighted legal areas such as intellectual property law, where he believes that blockchain technology has the potential to create a transparent and decentralized database of rights and rights owners capable of automating royalty payments using smart contracts and cryptocurrency, while excluding third parties who provide licensing.  This exclusion will result in lower costs for the management of intellectual property rights.

Insolar: New open sourced, enterprise-focused blockchain platform revealed

A new open sourced, enterprise-focused blockchain platform called Insolar has been announced. The platform is designed to solve urgent real-world business needs

Blockchain has its technical limitations, such as its inherent deficiency in search query processing primarily due to the linked data storage and the absence of a well-defined data indexing structure for various queries. And scientists are also concerned with lack of optimisation, especially in terms of security. In fact, the newest research shows that there are high risks of de-anonymization using anomalous relay patterns for network analysis, transaction’s user-related features such as random time-interval (RTI), and hour of day (HOD) etcetera, DoS attacks and transaction pattern exposure using transaction graph and AS-level deployment analysis.  There are also issues surrounding fake virtual currency, such as artificially split tokens known as pyramids, as well as concerns about how taxes will be collected and how banks will interact with cryptocurrency.  Still, despite its complicated nature and limitations, the future of blockchain technologies will see the simplification of business models and make them more adaptive and secure. The global trend is increasing the speed of all processes in all types of services.  Blockchain will heavily influence business models to increase the information flow both within the company (operational management, strategic decision-making etc.) and with third parties (costumes, partners and such).

Blockchain “game changer” developed by Accenture

Global management consulting and professional services firm Accenture have developed two solutions that allows communication between two or more platforms.

And as is pointed out in Banking on Blockchain: A Value Analysis for Investment Banks, “there is no turning back, especially considering the pronounced impact it [blockchain] will have in… current business models, operational get-togethers and profitability profiles – in both the short and the long term”.

Dr. Demetrios Zamboglou is the Chief Business Development Officer of the financial technology firm Lykke AG. He is an award-winning Fintech Executive, Blockchain Expert, and ICO Advisor with a doctorate in Management Research. Before Lykke, Zamboglou held executive leadership roles at FXTM, zebrafx and FOREX CLUB, specializing in issues including business development, strategy, risk management, market-making and compliance. He is a member of the following groups: Institute for Securities & Investment (CISI), the Institute of Directors (IoD), and the Behavioural Finance Working Group (QMUL). Zamboglou also serves on the Postgraduate and Research Committee at King’s College London.

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