Antitrust Matters Episode 5: The Intersection of Blockchain and Antitrust

Antitrust Matters provides engaging and timely conversations about competition policy in the digital age. Antitrust has always mattered to consumers and businesses, and to antitrust lawyers and economists, but today it also is in the political and public discourse more than ever. From the prices we pay for food, travel, financial services, payments to the way we interact daily using digital apps and platforms, antitrust touches each and every one of us in ways we may not even realize. Antitrust Matters brings you you perspectives of experts and visionaries in the field who discuss where antitrust law has been, where it is going and why it is so important to our current political discourse.

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Episode Transcript and Show Notes:

Jeff Shinder:

Welcome to Antitrust Matters, a Constantine Cannon podcast, where we have engaging and timely conversations about competition policy in the digital age. My name is Jeff Shinder, and I’ll be your host. Antitrust is always mattered to consumers and businesses, but today it is also in the public discourse more than ever. From how we get our food on our plates, to how we travel, to the way we interact daily, using digital apps and platforms, antitrust touches each and every one of us in ways we may not even realize. In Antitrust Matters, we bring you perspectives of experts and visionaries in the field who discuss where antitrust law has been, where it is going, and why it matters today more ever before.

Hello everyone. We are back for another episode of Antitrust Matters. And today we’re going to have an interesting discussion of blockchain and it’s implications for antitrust going forward. There’s been much discussion of blockchain in the commercial and trade press and lots of books written about its potential revolutionary impact on commerce. Its power to decentralize networks and disintermediate certain relationships and introduce efficiencies throughout the economy. Blockchain is a technology that can have significant pro-competitive benefits. So we’re going to discuss today. And at the same time, like many technologies, introduce new ways to subvert competition. And is entirely unclear what direction blockchain will go in terms of its implication for competition. This is an issue that antitrust thinkers, economists, policy makers have got to watch very carefully, and we have some experts today who are going to bring significant color to blockchain, its technological capabilities and its capabilities, both for good and less good in terms of competition.

We have two principles from Analysis Group here, and my colleague Grant Petrosyan, who has studied blockchain as well. Grant, why don’t you say hello to the podcast and introduce our esteemed experts who are going to be taking us through this discussion of blockchain. Grant.

Grant Petrosyan:

Thank you, Jeff. Hi everyone. We are joined today by Almudena Arcelus, and Mihran Yenikomshian, principal and managing principal with the economics and technology consulting Analysis Group. Almudena works on complex problems and litigation by applying her expertise in economics, finance and technology. She has analyzed economic markets and competition issues in antitrust cases in the US, Europe, Australia, Asia, and Latin America. Her work often involves leading companies and technology intensive industries. Mihran specializes in data analysis and economic modeling. He has consulted on strategic and litigation issues in industries such as healthcare, cryptocurrency, software and cybersecurity. He is active with the science and technology law section of the American Bar Association, and has a background in software development. Both Almudena and Mihran have written about antitrust concerns raised when competitors share data using blockchain technology and they co-authored an article in the Harvard Journal Of Law And Technology on the topic last year. Welcome to you both.

Mihran Yenikomshian:

Great to be here.

Almudena Arcelus:

Thank You.

Jeff Shinder:

It’s great having you both. And I’m going to open up the discussion with a very general question, but before we engage on the deeper substance of whether blockchain will be pro or anti-competitive in how it could be deployed in either direction, can one of you just describe what blockchain is for our audience?

Almudena Arcelus:

Yeah, of course. A blockchain is a list of records, each record is securely connected to the last using methods from cryptography. The list is distributed widely. And in addition, the list requires consensus. These features make information stored in a blockchain highly secured.

Grant Petrosyan:

So before we discuss some of the applications of blockchain, can you start by telling us what advantages blockchain has over more traditional methods of record keeping? What makes blockchain more secure and efficient?

Almudena Arcelus:

You are correct Grant, that security and efficiency are the key innovative features of blockchain. And they are the reasons why blockchain has the potential to change the landscape of many different industries. In terms of security, there are two aspects of blockchain that make the technology extremely immutable and tamper proof. First, it is shared by and synchronized across multiple users. Second, each new entry or block is securely connected to the previous block with something called cryptographic hash function. Essentially a cryptographic hash function is a one way mapping between an input and an output. These functions make it virtually impossible to alter connections in a blockchain. Also, the fact that the list is shared among many users means that individual users cannot make changes without the consensus of the group. As far as efficiency is concerned, blockchain technologies are efficient because they can automate processes. But also they connect many other forms or efficiencies that are specific to the context of their application. This is a fairly large topic, however, so we may want to address some of the applications before we get into the details.

Jeff Shinder:

Okay. So let me follow up on that. Many are familiar with cryptocurrencies like Bitcoin, which I guess are fairly considered applications for blockchain, but there are many other applications. So, can you describe some of the other uses of blockchain technologies, the other applications, so we can get a deeper understanding?

Almudena Arcelus:

Fundamentally, blockchain technology is a way to record process and authenticate data without centralizing the data or engaging in the manual process. And getting back to your questions of applications, any process service industry that really relate to that storage or collection and establishes trust, it’s an application for blockchain. In particular, one example that you may have used a lot is, or that you may have heard a lot is smart contracts. With blockchain, we can write computerized contracts that automatically initiate an action on when a previously defined condition is met. This type of a smart contract can facilitate contractual agreements between parties that would otherwise not trust one another. A typical example is if you are going to rent for Airbnb, in some cases, there are smart contracts that in the moment that you put your key through the door, that triggers the contract and in that moment your payment is transferred from you to the renter. So, these are some of the main examples.

Grant Petrosyan:

This is very interesting. So Mihran, it sounds like smart contracts could facilitate business to business relationships between firms that have not previously worked together. Is that correct?

Mihran Yenikomshian:

Yeah, you’re exactly right. And one of the key themes really is trust. So smart contracts that are facilitated on blockchain, they can encourage new business relationships in many industries. So take, for example, the auto industry. Car manufacturer may purchase steel from a separate company as an input to the car product. This is an example of a vertical relationship because the steel manufacturer and the auto manufacturer are not operating the same part of the supply chain. If the two firms have previously done business together, then they will develop trust and we’ll know what to expect. However, if they have not done business together, then each firm may have reservations about the reliability of the other. The auto manufacturer could be worried about the quality of the product, whether there’s timeliness of the deliveries. While the steel manufacturer might be worried about making a big investment and then only to have the auto manufacturer cancel and leave them without any place to ship their steel. So both parties have reasons not to trust each other. And trust could be particularly difficult when firms operate in different countries with legal differences that make contract enforcement more challenging.

Smart contracts have the ability to add credibility to this type of business-to-business relationship by writing automatic contingencies into the contract. For example, a contract could specify a fee for late delivery or cancellation of a product, that all happens automatically.

Jeff Shinder:

Okay. So let me follow up on that because I have to say, when I hear that smart contracts can facilitate transactions between firms that do not have reason to trust each other, I immediately, as an antitrust lawyer go to, well that could be competitors who otherwise wouldn’t trust that they would adhere to the rules of a cartel. But you’re also Mihran, articulating positive, efficient outcomes that are facilitated by smart contracts. And so let’s start with a deeper dive into that before we transition into the more nefarious potential uses of smart contracts. So let’s start with the pro-competitive side of the ledger, if you will?

Mihran Yenikomshian:

Absolutely. So there’s a number of ways that the smart contracts could help competition. So first the smart contracts can reduce transaction costs because they lower the cost of enforcement. So once the smart contract is created, any penalties associated with the breach of the contract are automatically applied and don’t require some sort of costly legal action. We wouldn’t expect that to happen with every contract, but firms account for the possibility of a breach and the expense that would be required to recover damages in the event of a breach. By reducing this recovery expense, smart contracts may reduce the expected cost of the firms of entering the agreement in the first place. So in other words, smart tracks may lower transaction costs.

Then second, smart contracts can increase competition by increasing choice. In that car example, the auto industry example, prior to the use of the smart contracts, auto manufacturers might not be willing to switch to a different steel manufacturer because they have the trust that they built with their current suppliers. But with smart contracts, the auto manufacturer might be more willing to expand his choice set to include more steel manufacturers in their process. So that could be a pro-competitive effect. And another example is that smart contracts can reduce barriers to entry because firms don’t need to gain as much trust with their suppliers because everything’s automatically enforced. So if you ever heard someone say that they can’t get a job because they don’t have experience, but they can’t get experience because they don’t have a job, well, that’s pretty much the same idea. So since smart contracts increase credibility, it allows firms with less experience to be successful in the market, which makes it easier for new firms to enter. In turn, this may lead to more firms overall and increase competition.

Grant Petrosyan:

Almudena, what about scenarios where two or more firms are in direct competition than the same market? Are there circumstances where blockchain applications can facilitate relationships between competing firms?

Almudena Arcelus:

Yes, there are Grant. Research and development is a good example of this. In many industries, there are multiple competitors that are working to solve similar research and development problems, but there is little incentive to share information. Blockchain technology can deliver a solution in which each piece of data is cataloged, labeled and immutably branded by the company that generated it. Companies can then trade this data in an open market, which can facilitate cooperation between competitors and significantly speed up the development of audio visual technologies, for example. This type of collaboration is not completely new with introduction of blockchain. But blockchain technology has the potential to lower the cost of these types of transactions between competitors with the use of smart contracts, higher levels of data security and irrefutable proof of ownership.

Another example is the relationship in mobility open blockchain initiative. It’s a program that includes various automobile manufacturers, such as BMW, Ford, GM, Honda and Renault. This product is currently testing concept for blockchain in the mobility industry.

Jeff Shinder:

Okay, so we’ve heard a lot of the potential pro-competitive benefits of blockchain. The greater efficiency, the reducing transaction costs, greater security. In your paper, you both have written on the ways that blockchain technology can be implemented in supply chain management. Can you give the listeners a sense of the various ways that blockchain can be deployed in that fashion?

Almudena Arcelus:

Yes. That’s a very popular one, the supply chain, because it lends itself so well to this kind of technology. The first one that comes to mind is a product source tracking. Specifically, blockchain technology can provide an indisputable record of all the data related to shipment status, storage environment conditions, and other milestone conditions. This technology could be used to verify the authenticity of a high-end good, by allowing the purchaser to see when and where it was created and who took possession throughout the supply chain up to the point of sale. As a result, blockchain could virtually eliminate counterfeiting attempts for many products. A good example is the sourcing of diamonds. For certain diamonds, consumers can receive a certificate based on blockchain technology with a history from where it was mined, through where it was published. Of course, these are the high-end jewelers who are trying to differentiate their products from others and avoid the blood diamond problems and the issues related to that.

Another way that blockchain can improve supply chain management is facilitating automated transactions. A blockchain system can act like an incontestable enforcer among all the parties involved in a trade via the use of smart contracts, facilitating financial transactions among unknown parties without dispute. This can ensure safe cargo shipping, even in cross border trades, and can minimize paperwork such as on labor cost and ensure data protection. A good example of this is coffee trading that supposedly goes through many intermediaries. And it has been automated in certain parts. I think of Kenya, where they’re using smart contracts and blockchain to try to avoid intermediaries processes.

Grant Petrosyan:

So it is clear that there are many positive aspects of blockchain technologies. But, there are also some anti-competitive concerns that need to be addressed as blockchain technology becomes more widespread. Mihran, can you tell the listeners how these types of issues could arise?

Mihran Yenikomshian:

Absolutely. And there’s two categories which I would put them in, the first being monitoring collusion issues and the second being potential barriers to entry with the blockchain. So the first one potential issue with distributed ledger networks such as blockchain is that it makes sales data more accessible to competitors, which potentially could aid in collusion, such as price fixing and bid rigging. This type of activity is still unlikely, but more accessible data could allow cartels to closely monitor prices and costs of market participants and detect deviations under inclusive agreement. And on the other side of this, however, it’s that these detailed sales data and what’s on the blockchain could also be accessible to regulators. So those regulators could then do their own analysis and see if there’s anything out of line with the prices or quantities or any just suspicious transactions that are happening on them. So there’s benefits and cons to that as well.

The second potential issue is related to the private permission blockchains. So this is a barriers to entry issue. Private permission blockchains are based on all the ideas as open source blockchain, except they’re not openly distributed. Instead, the private permission blockchains are only shared amongst a set of invited users. This could lead to barriers of entry, if a specific private permission blockchain network becomes critical to competing in that market. It is possible that incumbent firms could exclude potential entrants from the blockchain and block them from entering the market. One example of a private permission blockchain is the IBM Food Trust blockchain, which allows firms in the food and agriculture interstate to securely share food information. The private nature of this blockchain means that firms can choose to only share information within their own supply chain and not with competitors. While private permission blockchains may be important for certain sensitive data, regulators could reduce antitrust concerns by controlling who has access to the blockchains.

Jeff Shinder:

So Mihran, you mentioned regulators a couple times in that answer and how they can respond to these potential anti-competitive ways that blockchain can be deployed. Before we get into more detail about how regulators can do that, do you have any views on whether regulators are technologically equipped to address what’s happening on blockchain? Are they keeping up? Are they spending enough money to match what’s going on in the private sector with respect to these kinds of rapidly moving technological changes?

Mihran Yenikomshian:

Yeah, that’s a great question. So in terms of keeping up with the private sector, I think just the amount of funding that has been gone into blockchain, I think it’ll be hard to keep up with the private sector. But we have noticed that there has been because, and I think it’s largely driven by some of the cryptocurrency work that the government regulators are focused on this issue and that they are trying to catch up and get things in place so that they can effectively monitor these types of issues. I think the explosion that happened in like 2017, 2018, that’s when cryptocurrency kind of became really well known, I think there was a lot of innovative people at these regulators who took it upon themselves to learn about the technology. But I think the way that the government moves is just going to be slower than the private sector.

Grant Petrosyan:

So Mihran, in your article, you also discussed three key ways that regulators can mitigate anti-competitive outcomes. Can you tell us a bit more about those?

Mihran Yenikomshian:

Absolutely. So the three methods that we discussed in our article were sensitive data management, centralized government, and the third being the transparency for regulators. First sensitive data management involves ensuring that certain types of information are only accessible to specific users or excluded from the blockchain completely. Some data could be encrypted and have made visible to select users who have received a special key. Network designers will have to be forward thinking in order to carefully consider which types of information should be encrypted and which should be excluded completely. The second is regulators can use centralized governance strategies to reduce the risk of anti-competitive actions by firms. Centralized governance can involve regulators offering guidance on how to define clear membership rules for accessing networks. And they can oversee the network to be sure that firms and administrators incorporate and enforce rules. Centralized governance can also involve regulators their own special access to networks so that they can carry out enforcement measures. And the final one in regards to transparency for regulators, blockchain networks could be designed to be provide antitrust investigators with a clear audit trail. This would allow investigators to clearly identify the life cycle of an asset as it moves through a firms supply chain. Transparency would also provide regulators or antitrust authorities with accurate, reliable, comprehensive transaction data across entire firm, rather than the piece mail and inconsistent data that regulators often receive.

Jeff Shinder:

So if I may follow up on portions of what you just said, especially the notion that centralized governance strategies, the regulators would provide guidance, or may get specialized access to blockchain networks. And forgive me for this, for playing devil’s advocate, but from an antitrust lawyer’s perspective, I’m hard pressed to see that happening in the US regulatory landscape. Do you have any examples where an antitrust enforcer anywhere in the world or in the US, has engaged in that kind of regulatory strategy? Or are you talking about regulation outside the antitrust rubric that would engage in those strategies?

Almudena Arcelus :

They are part of the chain. There is a manual step. It’s like the equivalent when you turn the key for your Airbnb, there are other places, these places are called Oracles in the blockchain lingo. And so in some Oracles I have read, I have not seen it in action, I have not worked on a case where this is an issue where there can be manual intervention. I also read that in some cases in the transport of coffee, there were several places where the local agencies had access to the Oracle and they could see what was happening or in that part of the transaction. Had I seen a case in United States? No, I have not seen it.

I also saw a case in Cartagena, in Colombia, where the port got completely reorganized, maybe 15-20 years ago, I visited it maybe five or six years ago. And they had a system that it was not necessarily only based on blockchain, from being the lowest ports in the Atlantic, the busiest port in the Atlantic because they automated everything and there’s no manual and there’s no processes or anything. But, they have to provide certain kind of information because they made some deals with some of the unions, because of course they were displaced because right now people don’t make any decisions. You get your container and you’re able to move it automatically. It’s just a crane puts it, blah, blah, blah, blah. And they do have to respond to certain authorities. That’s what they explained to us. But that’s as far as I have seen that there are places where they have intervened. I also heard about some trade associations that they were going to include the option for regulatory overseeing, but I haven’t seen and again, I haven’t worked on a case. Mihran?

Mihran Yenikomshian:

Yeah. So what I’ll just add is, taking it a step away from blockchain, but more so like data analytics and data science, is that the government is, the regulators are getting more sophisticated with one, access to data, and then the skills to analyze that data. And we’ve been seeing it come up in different industries as well, different enforcements, not necessarily antitrust. But I would imagine this is going to make its way over to antitrust as well as the blockchain too, as those skills are deepened with government and regulators.

Almudena Arcelus:

Yeah. That you see a note pattern on the data, you analyze the data and you see certain patterns that you say, there’s a problem here. Yeah, we have had those cases in securities. So, that’s a good point Mihran.

Grant Petrosyan:

So we’ve talked a lot about the benefits and concerns, but one thing I’d also like to hear your thoughts on is how competition works in the mining of cryptocurrencies. My understanding is that cryptocurrency mining is the process that adds new transactions. Almudena, Can you tell the listeners a little bit more about this and how competitive it is?

Almudena Arcelus:

Yeah, sure. Cryptocurrencies like Bitcoin store groups of transactions in each new block. You can think of it like a long running receipt where each new block shows all the currency that changed hands. Put simply, mining involves using high speed computers to solve complex math problems. Each new block requires the solution to a problem. The first miner to solve the problem receives a reward, and other miners verify that the solution is correct. However, the odds of solving the problems are incredibly low and the computing power required to even make an attempt is very high and costly.

Jeff Shinder:

Okay. Coming back to the cryptocurrency application of blockchain for a minute, some of our listeners may have heard stories about people losing their crypto wallets. Can you tell us a little bit about that?

Almudena Arcelus:

Yeah, sure. There are multiple stories of people with huge sums of money that they cannot access because they have forgotten their password. The high security of cryptocurrencies is very effective at preventing others from accessing your money. But unfortunately, if you forget your passcode, then those same security measures block you from accessing your own money. If you are the type of person that routinely resets forgotten passwords when logging into online accounts, then you may need to take extra caution. Luckily, for the more forgetful folks, there are also companies that hold cryptocurrencies on behalf and provide similar services to banking apps, including password recovery. A few examples are Coinbase, Binance, and Uphold. Of course, with this type of services your security’s only as good as the company’s security, which is less secure than the cryptocurrency held on your behalf. And there are also funders, Mihran, we were discussing them the other day. That if somebody says, “Oh, I have 400 million in cryptocurrency and I can’t find my password.” There are companies that are taking on, they buy it from you, 10 cents or whatever it is for the value of the dollar. And then they are going to try to have algorithms to break into it. But so far I haven’t read anything of anyone who has been successful. Maybe they won’t tell us.

Mihran Yenikomshian:

Yeah. If you think about it, that a lot of people got Bitcoin in the early days, that’s almost like a joke. And so, oh, here’s 10, here’s a hundred, there’s one famous one from called Pizza Day, where somebody wanted to make a transaction and then gave somebody a lot of Bitcoin. And that now today is worth tons and tons of money. But, you may have put it on a hard drive, and then it’s been 10 years and you haven’t thought about, “Oh, what was my password back then? But now all of a sudden I have this hard drive that has my cryptocurrency on it. And it’s worth hundreds of millions of dollars.” What do you do with it then? And so that’s where a whole different problem is that if you put in the password wrong 10 times, that’s a delete. Do you need to sell to someone who’s smarter than you that can try to crack it in a way? Who knows. But a joke became real money very quickly and became a problem for lots of people.

Jeff Shinder:

So I want to put a question to both of you before we can conclude. I think it’s fair to say, but you’ll just see if you disagree, feel free, that I think both of you, this is apparent in your paper and as you discuss the issues today, you’re pretty bullish in a positive way, in terms of blockchain’s capacity to improve competition, to facilitate commerce, and be a force for good in the economy going forward. And that’s certainly not a controversial perspective. So I want to actually push you on the opposite question, and want you both to address, what do you see as the greatest risk for anti-competitive harm emanating from blockchain? If you fast forwarded five, 10 years from now, and we were to have a conversation, bring you back on this podcast to have a deep dive about a competitive problem that’s being introduced by blockchain, what would you think it would be?

Almudena Arcelus:

I have always thought that if two or three companies want to get together, they can share the password or the wallet password. And then it would be really hard to find out whether they are, for example, sharing prices and quantity of a certain product. They are competing, but they have this secret account. And if they do it in paper, that they go to a bar and they are writing it on a napkin, they put their password in pen. So there’s no electronic record of that, that was happening. That could cause some collusion and people to be anti-competitive because they’re going to be sharing information. That’s where I would think they will go. What give me pause is the fact that because we are humans, they have to trust each other. And so if one starts to deviate, well, of course the three of them are monitoring. I don’t know if there’s going to be a moment that the deviation is worth the risk of getting out of the cartel and producing more quantity or lowering the prices or whatever it is, even though later they’re going to be punished. So yes, they can get together. They can collude. But, on the other hand, some of the economic exogenous factors can cause them to become greedy and go the wrong way and the collusion to disappear. So that’s the one I was thinking of.

Jeff Shinder:

So I had a follow up question for you. Isn’t it true as we analyze the potential for cartelization to emanate from blockchain, that blockchain has the capacity to both facilitate that information exchange, but also police the cartel to shift the incentive somewhat. Because what you articulated is the traditional tension that exists within our cartels, whether they’re in it facilitate through blockchain or not. And so do you believe that blockchain has the capacity to make policing cartels easier?

Almudena Arcelus:

Well, if they get one of them and this person provides them with the password, they can definitely check everything. So it would be really, really detrimental to the cartel if one is caught. And I also want to add that cartels can become  more sophisticated in the sense that they don’t need to be checking every price and every quantity to increase prices. It’s like they say, they lift all the boats. So this close monitoring also doesn’t need to exist all the time as there are other theories of forming cartels. So yes, I would think that this blockchain it’s another technology. But this may have said the same about databases in the 1950s, when IBM was there. They could have said, “Well, you have access to my mainframe. Why don’t you check my mainframe?” So there are other factors that are avoiding this kind of communication of collusion. But, is that technically possible? Yes. But the human factor, I think plays different tricks and it doesn’t provide a consistent way of coordinating, but I can be wrong.

Mihran Yenikomshian:

And along the lines of the human factor, what I would think the biggest threat really is this lack of good design and thinking about humans and how they tend to exploit things with bad design. And blockchain, like AI is such a hot area where there’s lots and lots of people who do these things, and they’re being developed very rapidly that it needs to take a good look to see if this can be the foundation of something you’re building something upon that. What is the design? Is it intending what we know that we want to get out of it, but also are there ways that it could be gamed? And taking those considerations when someone’s choosing to implement a blockchain, I think is going to be very important. And that if some are built upon, let’s say incomplete thought or incomplete consideration for human elements, that there could be threats there.

Jeff Shinder:

Okay. So Mihran, I want to go back to the question. I’m not going to let you dodge it. What would be your answer? Five years from now, where we’re having this conversation over the principle anti-competitive evil of blockchain, what would it be?

Mihran Yenikomshian:

The principle anti-competitive evil of blockchain?

Jeff Shinder:

Yeah. Forgive my colorful formulation.

Mihran Yenikomshian:

Yeah. I would have to say along the lines, isn’t it that really, there could be instances where it could be gamed by certain individuals. And I think that goes back to my positive side of it, which is how would you prevent gamingship of this blockchain? Because if you say here’s a computer system, look, everything looks fine. If you look at it and just say, “Okay, we’re done here.” You have to think about the human element too, that is it really fine even though the data looks fine? And, as Almudena has said, we’re in a room with a napkin, with a 30 character password passing that around. And then that’s something that the human side of things, even though these smart contracts they’ll execute, they’re going automatically, but there’s still that human element. I think that is important.

Jeff Shinder:

Okay. Let me ask one last question. Do you see blockchain challenging central networks in the economy? That we have various centralized network industries? One example would be payments, which is the market that this firm is deeply involved in. Do you see blockchain fundamentally altering how highly networked, centralized network markets operate going forward?

Mihran Yenikomshian:

I think there’s going to be industries and use cases where it will. One area where I think is incredibly bad right now, and not blockchain is cross-border payments. That’s one where sending money to another country, it’s just very cumbersome and it takes a long time. And when you think about blockchain or cryptocurrencies, that if you’re trying to get money in and out of Venezuela, using cryptocurrency’s ia a much more efficient way than trying to get US dollars in and out. And so that’s where I think it could be very disruptive.

Almudena Arcelus:

I was thinking exactly that, in the same example. For example, in Salvador, now Bitcoin is a currency that the government is trying to use because they depend so much on payments from people working in the United States back home. So that one is already going. It’s not future, it’s present that the way many people are sending money back home. So yes, I think that’s going to be one of the first places where that’s going to be get very entrenched. I think that one day I heard in a presentation that there’re 6 billion inhabitants in the world. And I think just two or three have a checking account. So, for the other three, you definitely need these kind of services or options. And some countries such as Kenya, are actually very advanced in the field that is called FinTech, where blockchain is very entrenched.

And it is amazing because you go on the road and you see this, have a fantastic service for payment where you use a flip phone, you don’t even need a smartphone to activate this. You just need these very old phones and you just go to the pharmacy and there’s like a bank. And literally a bank is a stand on the road that is open four or five hours. And you go with your phone and you just give this person the money. And this person immediately puts the money in the account of the mother of this person who wants to send money to her mother, who is, in the mountains. And they can do it just with the flip phone. They enter codes. Part of this technology on the line technology is blockchain. So yes, it is there for payments. I’m assuming you were referring to credit cards, but I don’t know if that’s where you were heading, but as you left it open, I took it as sending back home money. Yeah, that’s one that is everywhere.

Jeff Shinder:

I wasn’t necessarily referring to credit cards. Payments is a big topic, but centralized network industries, which payments is an example that’s certainly near and dear to the experience of our practice. Well, this has been fascinating. We’re going to leave it here. We’re going to watch this. We’re going to have you back. And we’re going to see if pro-competitive side of the ledger, which you discussed at some length today happens, and where blockchain goes and how it affects the economy for good or not for good. We really appreciate your time. Thanks for coming on the pod and we will have you back, so thank you very much.

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