To gain a clear idea of the developments happening around blockchain and what an expert thinks might be in store for the gambling industry, GamCrowd spoke to Eddy Travia, chief executive of Coinsilium, a leading fintech start-up which facilitates the creation and implementation of blockchain-based technology products. Here’s what he has to say about blockchain, gambling and the regulatory response to the technology.
GamCrowd: Specifically with regard to the gambling industry, do you think regulators globally have any real clue about blockchain, how to regulate it, or indeed, how to understand its potential impact?
Eddy Travia: I think if they were looking at how to regulate blockchain per se then they would be going down the wrong path. It is how the blockchain might be used in a gambling application that may need to be regulated. If the use of blockchain tech is merely facilitating something that was already happening then it may not require further regulation at all. However, for the regulator to decide this then they need to understand the technology and its implications, and this education will take some time as it is taking time for regulators in other industries where blockchain is being used. I believe an angle that regulators should be taking is to ask how blockchain can help with any regulatory issues that exist in the gambling industry. For example, issues of transparency, trust, auditability etc. can all be helped with blockchain, so see it as an additional tool rather than additional risk.
GamCrowd: Do you think gambling regulators have been sidetracked by issues around Bitcoin?
Eddy Travia: Perhaps, but this is exactly what has happened in most industries prior them looking at blockchain. It is understandable given the initial noise around bitcoin that put a negative slant on it - it was natural for the gambling industry to be wary of it. But, by being wary they went through the same process we saw in fintech; they learnt about bitcoin and then realised the potential of the blockchain.
GamCrowd: Are there other sectors where there is perhaps a more fully-formed regulatory response to blockchain? I'm thinking fintech here, but any others as well?
Eddy Travia: It is important to first of all be clear on what regulation and blockchain really means. This is not a product or a service that can be regulated. It is a technology. The fintech space is certainly the most advanced when it comes to working with the regulators whilst implementing blockchain solutions. This is not surprising given finance is a highly-regulated industry anyway. One area which is certainly working hard to find some kind of common ground and response to how blockchain can be used is in regard to identity. This is a project that spans many start-ups but has implications for governments, citizens and most industries so in terms of regulation it is a lot trickier and so we might end up seeing a regulatory body or unified response.
GamCrowd: On the commercial side, have you spoken to many companies looking to exploit the potentials of blockchain in the gambling space?
Eddy Travia: At the moment we are in a similar phase in the gambling space that we saw in the fintech space a few years ago - that there is lot of talk whilst companies and key players figure out where the action is going to be. Obviously bitcoin has been a distraction for both the gambling community and the regulators, and this happened in fintech as well. But we are now getting to a stage where the industry can look to blockchain and any viable opportunities it might hold for the space. Yes, we are speaking to a company specifically in the UK looking to exploit blockchain potentials in the gambling space in an innovating way but of course we cannot say more here at the moment.
GamCrowd: How do you see blockchain/bitcoin transforming the world generally?
Eddy Travia: This is a big question. I think if I deflect it slightly and say how the world sees bitcoin/blockchain transforming the state of play then you might get a better insight. It is without doubt the single biggest technological development to grab the world’s attention, since the internet. At the moment the scope and scale of what it can affect is quite unknown. On the flip side to this we are seeing a lot of blockchain hype. We speak to a lot of people and companies who are looking for a blockchain solution and actually they don’t need blockchain to improve/grow/pivot their business per se. A simple answer is that we will likely get to a point where blockchain solutions have touched the human race on all levels of interaction: individual, community, country and internationally. It will have affected all walks of life from developed countries through to third world economies. It will be implemented by all major industries from shipping to finance to charities all the way up to international government organisations. This is not to say that everyone will have heard of blockchain, or even directly used something that is built upon or benefits from blockchain tech, but it will be big enough to exist in all of these areas.
GamCrowd: What timeframes are we talking about with regard to how fast blockchain and crypto-currencies will be changing the way people do business?
Eddy Travia: Let’s tackle blockchain first of all. I would argue that its potential wasn’t realised until 2013/2014. Since then we have seen a lot of blockchain hype (as I mentioned earlier) and this has been encouraged by numerous blockchain papers, conferences working groups, councils etc. This is not to say that these are a bad thing. In fact, they have all done an excellent job in bringing together all sides of the conversation, with different views, ideas and technological developments regarding blockchain. But what the world needs to see now is the actual roll out of blockchain solutions. This has started to slowly happen this year and will no doubt make a bigger impact in 2017 once more real-life applications of blockchain technologies are being used around the world. Prior to blockchain there had been a lot of fuss about bitcoin, most of the coverage (note: not use) was on the extreme side of the debate - one side that believed it was solely used for money laundering, the other believed that it meant the end of the dollar. Both sides looking at it in a very narrow way. But bitcoin still serves a very important purpose and we continue to see investment into both bitcoin and bitcoin-focused companies and therefore a change in the rhetoric. What bitcoin has done has inspired many other cryptocurrencies which have, until very recently (excluding ether and a couple of others) not been up to scratch. Yet in the last year or so we have heard talk from some central banks, governments and large organisations about their own cryptocurrency. I suspect it will take a while longer to see bitcoin or any other cryptocurrency make as big an impact on a similar scale to that of blockchain.