Millions of words and thousands of articles have been written about us leaving the EU, yet I regard Overli’s article on blockchain as easily the most important so far. Allow me to explain why.
He starts by making an obvious but continuously overlooked point: “We appear to be discussing Brexit in a language that suggests the world hasn’t changed since the UK joined the EU in 1973. By thinking more creatively about the role technology could play, we could solve problems that currently seem so intractable.”
As an intro to the use of technology Overli says he was surprised by the lack of attention given to David Davis’ observation last month that the know-how now exists to create a non-visible border between two countries, citing the example of the US border with Canada in Detroit, where both countries employ a variety of electronic tools such as sensors.
Indeed anyone who uses something as basic as the M25 Dartford Crossing will be very familiar with high speed continuous vehicle identification.
But it is when he turns to uses for blockchain that things really get cooking. To quote: “Negotiators need a crash course in blockchain, the distributed ledger technology that enables multiple parties to share and update records of transactions with no need for a single central authority… blockchain’s real selling point is that its mutual ownership can generate trust where it is otherwise completely lacking.
“In fact, blockchain has many potential applications post Brexit- not least as a single central register for tracking all movements across the invisible border Davis envisages.”
Crikey! This is looking interesting isn’t it? Indeed Overli is just getting into his stride, so we have: “Elsewhere, take customs controls, where the UK is adamant that trade must continue to be free and frictionless even after Brexit. Blockchain is ideally suited to delivering such objectives-the ledger would enable every party involved in a cross-border transaction to access a single book of record in which the goods were recorded, tracked, traced, and charged to the right duties and tariffs.
“Or what about the need for the UK to negotiate and manage a trade treaty covering all goods and services with each of the EU’s remaining 27 member states, requiring thousands of new agreements? Here the ability of blockchain to underpin smart contracts could be crucial. The technology even exists for computerised agencies to enter into these smart contracts without human interference.”
Do I hear you say very interesting but surely Overli has entered the realms of science fiction here? Absolutely not.
Bryan Zhang and colleagues from the Centre for Alternative Finance (CAF) at Cambridge University’s Judge Business School, recently released their Global Blockchain Benchmarking Study (supported by Visa and EY). Their findings are very revealing. They were supplied with data from over 200 companies, central banks and public sector organisations.
CAF found that 57 central banks and public sector organisations across 31 countries are involved with blockchain exploration or trials and Europe dominates with 49 per cent of total. And what are government organisations exploring the use of blockchain for? Exactly what Overli is writing about, namely:
- Identity management;
- Ownership records management;
- Business records management;
- Audit trail;
- Document management;
- Government account settlement and reconciliation;
- Logistics; and
- Supply chain management.
The research, carried out in the six months ending May 2017, estimated that more than 500 staff in the public sector (including central banks) are now working full-time on blockchain and many thousands are full-time in the private sector of which the majority are in finance. Here again Overli has a most apposite observation.
“Then there’s the all-important financial services sector. Many in the City are terrified Brexit means an end to the passporting system that enables UK-based banks, insurers and investment managers to trade across the EU.
“Leading financial services businesses are already looking at the potential of blockchain to replace stock exchanges and other market places for capital. Such initiatives may in time provide a means for the sector to continue functioning as if Brexit never happened.”
Overli’s seminal article gives the lie to the Remoaners continual refrain that Brexit is all too difficult to enact and will end badly. That may have been the case if we were still living in 1973 but this is 2017 and Brexit is very much of the moment. As Boris Johnson said a few days ago: “Let’s get on with it.”
Share this story