The Blockchain and Us: Interview Matthew Roszak, Bloq

Transcript

there's not one element not one faster this space that I'm leaving unturned here I feel like this is a generational opportunity for entrepreneurs and investors and I quite frankly I've not seen something as exciting in my entire investment career my name is matthew Rosic I'm co-founder and chairman of block block is a enterprise software company and we build blockchain networks for leading companies worldwide I've been in the venture capital business for 20 years and also co-founded six enterprise software companies I originally came across Bitcoin in 2011 when I was chairman of a social gaming

company in Southeast Asia and when you're in social gaming payment processing cross-border payments becomes core competency very quickly so when you're moving money from Korea to Philippines to Indonesia to Malaysia you start paying attention to costs and friction of PayPal and credit cards and what-have-you and so when Bitcoin comes on the scene III did what most people do the the first moment they are exposed to Bitcoin I discounted it I thought this was silly internet money you could mine it it's like a Golden Goose and it took me about a year to really react Splore the technology and so by 2012 I did what

I tell most people to do today is turn off your phone and lock your door and study this technology for a day it's the best advice I could give blockchains our networks and that works that we see today Alibaba Airbnb uber those are interesting networks but they're centralized networks here you're gonna have networks that are decentralized that are working more on as a cooperative I think the the challenges will be what are the economics of those networks were the economics of certain block chains first is today's discussion which is all about the technology I think tomorrow's discussion will be about how do you build Network effects off of these new

railroads I think there's gonna be a lot of disruption a lot of revolution with respect to blockchain based technologies and what that's gonna drive is is not necessarily banks worried about other banks being competitors what what banks worry about is the is the bank of one you know the the next generation of of a banking Network that's resident on on a phone that's decentralized that's distributed and is based on a digital token a digital asset that's not actually issued by a bank or a government or anybody else so it creates all these different permutations and

opportunities not only for enterprises and governments but also for for society and right now you know it's it's not that difficult to go into a coffee shop or buy a pair of jeans with with the credit cards and all the kind of banking infrastructure that I have but if you're a goat herder in Ghana if you're a taxi driver in Indonesia you have no access to the global financial system and so having you know what what you do have is you have a supercomputer in your pocket and so with that it opens up incredible financial sovereignty where you can connect to the global financial network by having some digital currency in your

pocket if you look at what internet did to media and communications blockchain will do to banking insurance capital markets and 100 other industries where by the movement of value is now going to be done on new railroads those railroads are being built on top of the Internet and what that what that's going to do is is provide current network operators so so think of nothing there's really how do banks innovate and kind of replumb themselves but think about how those networks those blockchain based networks are used for payment rails within Facebook within Alibaba within Amazon and they will provide

payment layers as enhancements to their networks these will be just service layers where on one hand they may not care about banking and payments and some of those fees and and be apt to give those away for free to harden their networks and create Network effects within their pool of customers so if you look historically at the internet the internet was a very thin protocol and a lot of the value was captured in the application layer so thank Google Amazon Facebook and hundreds of billions of dollars were put on top of that railroad in the blockchain railroad if you have something like Bitcoin and you have a digital token the protocols actually and

the equity token within that protocol is very valuable the more applications you put on it or throughput the more velocity and volume you you put in that protocol so you have thinner application values and very thick and fat protocol values and so you're seeing this in Bitcoin which is a 1520 billion dollar baby protocol currency I have this in etherium which is about a billion but as these things continue to gain adoption and traction you know and value these protocols can be worth hundreds of billions if not trillions of dollars depending on what applications they wind up securing and so from an investment standpoint back in the late 90s if

you're saying internet search is going to be a big deal and we had Google and Ask Jeeves in front of us and and we picked Ask Jeeves we could have been right on the space and wrong on the horse in these new protocol networks where you have a digital token and an equity share in that cooperative and then network that you're involved in you get to participate in that and that value which is from a technology standpoint it's pretty unprecedented if you're a intermediary if you're a middleman for in the case of the insurance industry or the banking industry there's a moment in time where you're gonna have to present in front of your board and say the center of what we

do the center of how we make money is now free that's the bad news the good news is we've built these concentric circles of other service layers and other ways in which to remain relevant and build and leverage off of our network and our regulatory edge and our brand and either be a network operator a network participant and really play through this this evolution of clashing technology as it disrupts that the middle piece of what these intermediaries do [Music]