I had an interesting private meeting last night with people well-connected in the crypto world. Like myself they saw the great potential for cryptocurrencies and blockchain technology to deliver financial inclusion and disrupt the cosy oligopoly of our finance industry. Unfortunately, they report that in those parts of the world that most need the benefits of crypto the first adopters are bad men with guns.
The UK’s most enduring export has been governance. In imperial times we exported democracy, common law and freedom of speech. More recently the Cadbury and Turnbull reports have had global influence on the management of companies. There is both a necessity and duty for the UK to develop and export blockchain technology and crypto-regulation. This must go hand-in-hand with the West’s effort to transform the corrupt governments of developing and middle-income nations that have consigned present and future generations of their citizens to poverty.
Crypto-libertarians are likely to see governments as the problem not the solution but this fallacy was addressed by Thomas Hobbs in 1651 who argued that effective government was essential if men are live in peace and prosperity.
Hereby it is manifest that during the time men live without a common Power to keep them all in awe, they are in that condition which is called War; and such a war as is of every man against every man. […]
In such condition there is no place for Industry, because the fruit thereof is uncertain: and consequently no Culture of the Earth; no Navigation, nor use of the commodities that may be imported by Sea; no commodious Building; no Instruments of moving and removing such things as require much force; no Knowledge of the face of the Earth; no account of Time; no Arts; no Letters; no Society; and which is worst of all, continual Fear, and danger of violent death; And the life of man solitary, poor, nasty, brutish, and short.
To address this challenge the UK Government will have to accept that blockchain and crypto are disruptive technologies. The motor car was not just a faster horse, blockchain is not simply a way to reduce the cost of the existing banking system. Unfortunately, UK PLC suffers the innovator’s dilemma, as the world’s leading financial centre it is too highly invested in the existing system to challenge it at home.
UK PLC needs a Skunk Works where it can demonstrate the transformation nature of blockchain technology without being challenged by vested interests. Perhaps it could help the Government of a small protectorate or commonwealth nation to improve transparency of tax collection and expenditure? There are many businesses in this crypto directory that could help them.
In doing so, they would greatly help the citizens of the recipient nation and help secure London as the world’s premier financial centre.