Issue link: https://maltatoday.uberflip.com/i/1114702
09.05.19 11 INTERVIEW beginning of a new revolution Money laundering, unfortunately, will always take place somehow, be it through complex offshore structures, corrupt banks or smuggling large amounts of cash by sea. Unfortunately, it will happen through crypto too ties – regardless if we are talking about traditional banks, placing cryptocur- rencies on the market or operating a crypto exchange. Is the association between blockchain and cryptocurrencies – such as Bitcoin – with illegal activities, unfair? It is unfair but understandable, be- cause, when it first started, Bitcoin was often used for illegal activities. Now that Bitcoin can be traced, those wanting to conduct illicit practices are using oth- er cryptocurrencies. It is possible that in the future exchanges opt not to list certain privacy (non-traceable coins) if regulation and governments ban them for being untraceable. But I also think that, gradually, people are understanding more what crypto is, so the association with illegal activities might be somewhat lessening. It's all about education. I get the impression that the common man in the street doesn't really understand what blockchain is. Do you think the technology will eventually become something we all know and use? Let's look at it this way: almost every- one uses the internet, but most don't really understand how the technology works. Blockchain will be the same – it will be used in everyday life, but people won't necessarily know they are using it. Some of the world's largest companies, such as Amazon, Facebook and JP Mor- gan are either researching the technolo- gy's functions or already using it. Of course, the use of blockchain will depend on the industry itself. Crypto- currency, for instance, could start being used as a more widespread means of payment, but there are still several is- sues which need to be solved. I am, however, a true believer in the technology, since it presents many ben- efits, such as cutting costs and provid- ing transparency. We are in the infancy stages in terms of adoption, but I think mass usage is only a matter of time. Just as people did not understand and realise the potential of the internet in the early 1990s, for blockchain and potentially cryptocur- rencies, the situation will be the same – we are now in the beginning of a rev- olution. Can traditional banking models and blockchain co-exist? Banks may feel threatened by cryp- tocurrency and blockchain, one of the reasons for which is because they make their money through lending activities and charging transfer and exchange fees, and so on. So if two people can send money directly to each other, without the need for a tra- ditional middleman, such as a finan- cial institution, this isn't a good thing for banks. is said, I think people who have ac- cess to traditional banks will adopt the new technology very slowly. But for those 39% of the world who don't have access to banks, blockchain technology through cryptocurrency can give them financial access. Not having access to banks is a global problem which inhibits persons from benefitting from economic opportu- nities, so crypto and blockchain can serve the purpose of financial inclu- sions for these people. Until we have widespread usage of cryptocurrency around the world, ex- isting banks will continue to operate in tandem with cryptocurrencies which are serving the purpose of financial in- clusivity for unbanked people. According to some, such as Erik Finman, a teenage "bitcoin millionaire", Bitcoin is dead. Is he wrong? I definitely would not say Bitcoin is dead – it remains the biggest crypto- currency, and many token issuers who want to raise funds for ICOs use Bit- coin. But it now has some fierce compe- tition from other cryptocurrencies. We are seeing the emergence of cryp- tos which solve some of the problems which inhibit mass adoption of Bit- coin, such as volatility and scalability. In terms of whether cryptocurrencies will continue to exist, I might be a bit biased in my opinion, but unless there are major barriers from government and financial institutions, I'd say they are here to stay. Cryptocurrency is an evolution of money, and it offers greater control of funds, so I don't think it's going to cease to exist. mcosta@mediatoday.com.mt