De uitgeefsector, goed voor 26 miljard dollar omzet in 2018, is druk bezig met zichzelf opnieuw uitvinden. Net zoals verschillende andere industrieën. Dit komt door de waanzinnige impact van de digitale- en internetrevolutie. De ouderwetse creatie-, distributie- en verdienmodellen werken niet meer. Blockchaintechnologie kan de uitgeefsector op verschillende manieren helpen bij het nemen van de volgende quantum leaps.

Verschillende grote bedrijven, zoals The New York Times, zijn al druk bezig met de implementatie van blockchain. Ook schieten de startups uit de grond. Recent sprak ik voor IAB Nederland, de Nederlandse branchevereniging voor digitale marketing, bij de Telegraaf Media Groep over de impact van blockchain. Daar haalde ik de volgende zaken aan.

Een eerlijke vergoeding voor de maker

Sommige schrijvers van boeken verdienen miljoenen euro’s met hun werk. Denk bijvoorbeeld aan de schrijfster van Harry Potter (55 miljoen dollar). Maar dit soort auteurs zijn in de minderheid. Een verkocht boek levert ze vaak tussen de vijftig cent en twee euro op. En gemiddeld verkopen ze 3000 exemplaren van één boek.

Bekende DJ’s als Armin van Buuren daargelaten, waar je vroeger als artiest binnenliep met de verkoop van albums, betaalt Spotify-artiesten tussen de 0.006 en 0.0084 dollar per stream. Voor een modaal inkomen moeten mensen jouw nummer zes miljoen keer beluisteren op jaarbasis.

Hoewel platformen als Amazon KDP en Spotify de sector een boost gaven qua opbrengst, blijft het grootste gedeelte van de opbrengst achter bij de vele tussenpersonen in de keten. Zo komt er maar een klein deel terecht bij de oorspronkelijke maker.

Blockchain-startups

Er zijn verschillende blockchain-startups die dit willen aanpakken. Zij willen contentmakers enerzijds een eerlijkere beloning geven voor hun werk. Anderzijds willen ze het makkelijker maken om contentgebruikers in contact te brengen met de makers.

Een mooi voorbeeld hiervan is Publica. Dit bedrijf stelt schrijvers in staat om boeken te crowdfunden. Consumenten krijgen tokens in ruil voor de investering. Daarmee kunnen ze een kopie van het boek krijgen. Het Chinese WeiFund doet dit voor alle soorten media en faciliteerde de campagne voor de film BRAID al succesvol. Steemit, de tegenhanger van het populaire blogmedium Medium, doet dit voor blogschrijvers.

De academische wereld

Academici zijn eigenlijk één van de weinige contentmakers die dit niet voor een financiële beloning doen. Dat is best raar, want in hun werk zit ontzettend veel tijd en moeite. Het systeem zit dan ook vreemd in elkaar. Als je niet in een bekende database als JSTOR of Wiley staat, hoor je er niet bij en kunt je een mooie academische carrière vergeten. En dat terwijl deze platformen geen enkele euro van de honderden miljoenen die ze verdienen, uitkeren aan de makers.

Oud CERN- en NASA-medewerkers zetten hiervoor de startup Orvium op. Dit zet enerzijds het peerreview-proces overzichtelijk op de blockchain, en anderzijds betaalt het academici voor hun werk. Startup Pluto focust zich enkel op de vergoeding.

Gaat blockchain alle tussenschakels verwijderen? Nee. Er zitten altijd nog partijen zoals marketing tussen, maar makers krijgen een eerlijkere vergoeding.

Wie is de maker eigenlijk?

Er is waanzinnig veel gratis content beschikbaar. En elke minuut komt er weer ontzettend veel content bij. Daardoor is het vrijwel onmogelijk om te zien aan wie voor welke content betaald moet worden. De veel bediscussieerde nieuwe Europese Artikel 13-wet is een eerste stap in de goede richting van een betere licensering van content en het voorkomen van misbruik ervan. Dit is dus ook een stap richting een betere betaling van content. Technologisch gezien zitten er nog veel haken en ogen aan.

Transparanter en efficiënter

Blockchain kan dit geheel een stuk transparanter, eerlijker, duurzamer en efficiënter maken. De organisatie Editions at Play zette als voorbeeld voor dit proces het boek A Universe Explodes op de blockchain. Ze willen daarmee laten zien hoe het werkt. Daarnaast zijn er verschillende startups die al werkende oplossingen aanbieden. Mediachain heeft bijvoorbeeld een oplossing die de metadata van muziek veilig opslaat en aanbiedt.

Recentelijk kocht Spotify dit. De dienst kwam onder vuur te liggen door niet betaalde royalties, wat volgens onderzoek komt doordat 25% van de gestreamde muziek geen licentie heeft. Grammy-winnend artiest Imogen Heap zette ook zo’n soort oplossing op de markt, genaamd Mycelia.

Databases voor teksten, films, series & kunstwerken

Met Civil kunnen lezers journalisten direct betalen. Op die manier zijn journalisten niet meer afhankelijk van grote mediakanalen. Ook voor amateurschrijvers zijn er verschillende oplossingen beschikbaar, zoals het populaire Po.et. Dit bedrijf heeft een decentrale database waar auteurs hun content in op kunnen slaan. Je kunt er ook inzichtelijk maken wie jouw content gebruikt, al is het maar één zin.

Po.et biedt een WordPress-plugin aan. Daarmee kun je een gepubliceerd blog direct in de database van de startup zetten. Het Nederlandse bedrijf Fintage House heeft net zo’n oplossing voor films en series. Artlery doet dit voor kunstwerken.

Het einde van fake news?

Dagelijks komt het voorbij: fake news. Op alle mogelijke kanalen en in de meest ingenieuze vormen die het heel echt doen lijken. MIT kwam in onderzoek tot de ontdekking dat we fake news 70% sneller op Twitter delen dan echte artikelen.

Een groeiend probleem

We kunnen blockchain inzetten om het gebruik van wisdom of the crowd tegen te gaan. Er zijn dan ook verschillende startups die tokens geven in ruil voor het maken van echte content. Gebruikers valideren deze content.

Startups Trive en DIRT bouwden bijvoorbeeld een systeem dat fact-checkers beloont. PUBLIQ werkt met de echtheid-score van lezers, net als Civil. Maar niet alleen startups zijn druk bezig met het vinden van oplossingen voor dit alsmaar groeiende probleem. De Europese Commissie maakte het inmiddels ook één van haar speerpunten.

Clickfraud

Fraude met digitale advertenties (clickfraud) kost bedrijven wereldwijd bijna zeven miljard dollar per jaar. Dit groeit momenteel met 50% per jaar. Eén van elke drie aan advertenties uitgegeven dollar is frauduleus. En de World Federation of Advertisers (WFA) verwacht dat de totale kosten in 2025 groeien tot vijftig miljard dollar.

Bedrijven zetten bots op de de meest vernuftige manieren in om het aantal clicks en views omhoog te krijgen. Dit is inmiddels goed voor 48% van het websitebezoek. Het gaat zelfs zo ver dat bots bijvoorbeeld online configuratoren van auto’s als BMW (waarvoor je euro’s per configuratie betaalt) nep invullen.

Ad-fraude tegengaan

Dit is een ontzettend groot probleem voor adverteerders en uitgevers. Momenteel werken bedrijven er op verschillende manieren met behulp van blockchain aan om dit tegen te gaan. Deze bedrijven zijn vooral bezig met het bouwen van platformen die de authenticiteit van de impressies verifiëren, maar ook relaties in kaart brengen tussen adverteerders, uitgevers en consumenten.

IBM is op dit moment samen met Salon bezig met het project AdLedger. Dit is een pilot om een gedeelde ledger aan te bieden voor het transparant en inzichtelijk maken van clicks voor zowel adverteerders als uitgevers. Ook Amino Payments biedt een dergelijke oplossing, die daarnaast helpt met het optimaler inzetten van advertenties. AdEx gaat nog een stap verder met ‘advertentie-veilingen’ op de blockchain.

Samen makkelijker content maken

Blockchain inzetten is niet alleen op commercieel vlak interessant. Het kan ook samenwerkingen met betrekking tot contentcreatie een stuk efficiënter maken. Als je een goed product wil maken, zijn er vaak verschillende experts nodig om de content te maken, bewerken, designen en om het op de markt te brengen. Dergelijke processen zijn vanwege de kosten eigenlijk alleen mogelijk voor grote bedrijven.

Door het decentrale karakter van de blockchaintechnologie is dit nu ook mogelijk voor kleinere partijen. Eén van de eigenschappen van blockchain is dat niemand de opgeslagen data kan aanpassen. Dit voorkomt fraude. Blockchain maakt bijvoorbeeld de geschiedenis van een document op het gebied van wijzigingen (wat en door wie) volledig transparant.

Blockchain maakt de geschiedenis van documenten volledig transparant.

Eindeloos veel mogelijkheden

Zoals ik in een eerder artikel schreef: de blockchaintechnologie is nog redelijk nieuw en bevindt zich op allerlei vlakken. Nu zit het voornamelijk nog in de experimentele fase. Hoewel veel startups werkende producten al succesvol inzetten, is de impact nog klein. Maar de mogelijkheden zijn eindeloos en ik geloof er dan ook echt in dat de uitgeefsector in de komende vijf jaren geweldig kan profiteren van deze nieuwe technologie.

Heb jij ervaring met de blockchaintechnologie in de uitgeefsector? Hoe gaat dat je af? Deel het met me in een reactie hieronder!

Although many eyes are still focused on the financial sector, the impact of blockchain technology on various other sectors is just as interesting. There are several major challenges in healthcare that are currently being addressed with technology. According to a survey by IBM, 15% of healthcare executives claim that they will implement the technology this year, and 50% say the same of next year. Dutch minister de Jonge recently responded to parliamentary questions from D66: “Blockchain has the potential to organize cooperation, data exchange, and mutual trust differently. This can, among other things, lead to a reduction in the administrative burden.” Research Deloitte conducted among care executives confirms the following: 70% of these executives indicate that the significant improvement in collaboration between the various parties within and outside the sector is the main reason for considering implementation.

Many healthcare organizations are already busy implementing the technology and, during the various keynotes and training sessions about blockchains I was allowed to give in the past few months, the participating healthcare professionals also asked a specific question: In what area can we get started? Here are my top 4 focus areas:

1) The Decentralized Patient Register

One of the biggest issues in healthcare is access to an exchange of information about the patient. In many ways, this causes a lot of inefficiency, errors and unfortunately also many other nasty consequences. According to Frost research, nearly 40% of patient data contain errors. Research shows that miscommunication between medical professionals costs the industry $11 billion per year. This is partially caused by inefficiency, but according to the start-up Labchain from Heerlen, the Netherlands, this is also due to the fact that healthcare institutions in the Netherlands still exchange patient data by mail, which is re-entered manually. Unfortunately, this increases the chance of incorrect entries, not to mention the errors made on the basis of erroneous data.

Data Breaches

The safe storage of patient data also unfortunately often goes wrong. According to IBM, some 2,181 data breaches within the healthcare industry were reported between 2009 and 2017, with 176 million patient records stolen. This is interesting data for hackers because a patient’s file yields more than credit card details.

How nice would it be for you to always have access to your file, no matter where you are in the world? That you can track the status of medical treatment and share data with parties you trust? The GDPR legislation, which dictates that consumers should be able to access their data themselves, is a great first step. Unfortunately, that is technically impossible for almost all healthcare organizations despite blockchain being able to play a great role in this. The Personally Allocated Budget (PGB), whereby different organizations work together to provide consumers with the right care and that I discussed in an earlier post, is a perfect example. But the sharing of vital data with researchers, to allow them to use it anonymously for their research into diseases and medicines, is another example. Intel has recently launched a ready-made solution for the latter.

Solutions to the Challenges

Many dozens of companies are already building or even successfully implementing solutions to the challenges mentioned above. Together with SNS Bank and Deloitte, Radboudumc built “Prescrypt” to easily arrange repeat prescriptions. The patient can determine him or herself with whom the information is shared (doctor, pharmacist, etc.), in order to conclude a prescription request. In its Blockchain Lab, Philips is working on solutions for sharing data between the various healthcare providers and connecting researchers and patients who monitor themselves.

There are many companies that focus on improving the safety of patient databases. It has led the well-known MIT Media Lab to establish MedRec for this purpose and internet giant Google, with its AI department Deepmind, has already made it possible for hospitals in England to put patient records on the blockchain. Guardtime has already successfully implemented the same solution for the governments of Estonia and the United Arab Emirates, and BurstIQ, Factor, Medicalchain, SimplyVitalHealth, Patientory, Nebula and Medicalchain also offer working solutions for this issue.

There are also various cool companies that use blockchain technology in an even more radical way. Coralhealth uses the technology to make personalized medicines possible and recently successfully tested this. EncrypGen has launched a platform that allows people to sell their DNO in exchange for cryptocurrency. Lancor has used a combination of AI and blockchain to develop a tool to increase the reliability of cancer screenings from 60% (by people) to 90%.

2) Get Rid Of The Deadly Fake Medicines

People in the Netherlands are used to obtaining medicines from a pharmacy and they can assume that they are also “real”, i.e. directly supplied by the pharmaceutical company. However, according to HRFO, 15% of the medicines sold in developing countries are fake, something the World Health Organization claims causes 1,000,000 deaths per annum! This market for fake drugs is now larger than that of illegal drugs and it costs pharmaceuticals an estimated (HFRO) $200 billion per annum.

Several industries are already successfully using blockchain technology to make their supply chain transparent for consumers, be it for orange juice or diamonds. American legislation already obliges manufacturers and suppliers of medicines to track medicines from production to sale, to combat fake medicines. Dutch hospitals and pharmacists will have to comply by 2020. Easy “tracking & tracing” is, however, a technical challenge, and some pharmacists consider blockchain the big “game changing” solution. Chronicled recently won the Newsweek Blockchain Impact Award with their “MediLedger” solution which was used by the pharmaceutical company Pfizer and Genetech to place their supply chain in a decentralized manner on the blockchain. The French startup Blockpharma also offers a ready-made solution.

3) Preventing Fraud & Mistakes

Research shows that 5–10% of healthcare costs are fraudulent in nature. On a global scale, this is a very large amount. In addition to fraud, too many errors are still being made in the administration, and the increase of this, in addition to the many intermediaries that further amplify it, causes an unnecessary amount of costs, says Deloitte. It involves a massive amount of money that, obviously, could and should have been spent on providing real care.
 One of the advantages blockchain is being praised for is the removal of the “middleman”. By putting data on the blockchain in a decentralized way, many administrative processes can be automated and thus operate much more efficiently and fraud is prevented. Estonia has already taken a major step in this direction by having 95% of all healthcare data validated automatically and their operations made transparently. In the Netherlands, insurance company VGZ has successfully piloted an app that allows the entire maternity care to be placed on the blockchain. Parents can see on the app how many hours they have been receiving care and how many hours of care they are still entitled to. A maternity nurse can indicate how many hours they have actually worked. The insurance company can use this data to pay the maternity caregiver directly and to prevent fraud with the number of hours claimed.

4) Personalized Care

Personalized care is one of the biggest trends in healthcare. Gone are standard solutions for the masses: a customized pill or treatment based on, for example, big data from a patient, is the new norm. This is not only better for the patient, who therefore receives better care, but also for the sector itself. As an example, the industry calculated that $300 billion is spent on ineffective drugs per annum. Blockchain ensures the secure transfer of data between different parties, who can use this for the aforementioned research, but also personalized medicines. The company Robomed, which combines blockchain, artificial intelligence and the “Internet of Things” is a good example. Through chatbots and wearables, they collect and analyze a unique flow of information and translate this into practical advice for the patient.

Panacea for Healthcare

Blockchain is not directly the panacea for healthcare that will immediately help the entire sector with its greatest challenges. However, Frost & Sullivan claim that successfully applying the technology can save the sector many billions of dollars, mistakes, and human lives. The first thing it then really has to do is to make an effort in stopping the forming of data silos that currently are hardly shared and that, according to many experts, is already causing major problems. Just like in many other sectors, the time has come to fully experiment with and invest in technology, to ensure that healthcare is still affordable and effective in the coming years.

Jan Scheele is active in the web3 (blockchain, crypto, NFTs, DeFi) industry since 2013. Besides (former) CEO of a web3 scaleup and founder of an advisory boutique (working for governments, family offices and several multinationals), he is Digital Leader at the World Economic Forum and Board Member at the Blockchain Netherlands Foundation (BCNL). He is writing, consulting, speaking and training regularly about everything web3, all over the world. Furthermore, he is currently finalizing his book about the rise and global impact of blockchain technology.

I still remember this amazing moment. When I was 6 years old (in 1993), my father got his first computer from work. A device that took half the desk, but soon won my heart because of the 3D racing game “Stunts”. Four years later, I was introduced to the Worldwide Web by a friend, who had the Veronica website open and at the age of 14, I started managing the first community pages of one of the first websites in the Netherlands; Startpagina.nl. I can hardly imagine how much effort I had to make at that time, to connect to the internet and surf on it. The sounds of clicking floppies and creaking 56k dial-up modems are still well engraved on my memory.

“I think there is a world market for maybe five computers.”
Thomas Watson, president of IBM, 1943

Dependent On Blockchain As On The Internet

How different it is today, where we are constantly connected to the internet with our mobile phones and where I already hear people sigh if they happen to have a 3G instead of 4G connection. Although technological developments are going very fast at the moment, the run-up to the development of the internet has taken quite a long time. The precursor, ARPAnet, was developed already in the 1960s by the US-military as a means to allow computers from a few researchers to communicate with each other and to exchange documents. The development of technology took a long time; only in 1991 did the first website come online and in 1994 the first web store. Although Amsterdam was the first European junction to be connected in 1982, Dutch users could only surf the Internet publicly from 1991 onwards.

What started as a mere exchange of information between a handful of research institutes has now become an integral part of our lives. Who could have realized at the time that we became so dependent on the internet? From communicating, banking and listening to music to shopping. It is very funny to hear all skeptics talk about things like encyclopedias, CDs and route maps that the internet could never replace. Wikipedia, Spotify and Google Maps have proven the opposite, not to mention the many other everyday items.

By 2005 or so, it will become clear that the Internet’s impact on the economy has no greater than the fax machines. ”
 — Paul Krugman

Rise of Blockchain Technology

The current rise of blockchain technology is often compared to that of the internet. Not only its long duration but also the first anxious and rejecting attitude of consumers, companies, and governments, the cracked “bubble” and predictions about the insane impact on our society in the long term. According to the Gartner Hypecyle, blockchain technology is currently in the “trough of disillusionment”; experiments fail and companies see investments being burned. Developers within the industry exit rapidly and the press eagerly writes about the negative experiences. Why would we do so much effort for a Bitcoin payment within an online store, if it is also easy and safe with Paypal? Why would we spend so much time sending a tip via the Lightning network, if this can also be done quickly via a Tikkie (Dutch Whatsapp payment solution)? Convincing the crowd for adoption is clearly not successful yet.

Cryptocurrency Hype

Bubbles are, in my opinion, great for separating the wheat from the chaff, removing the hype from something and focusing on real problems that technology can tackle. Last year I was, at the height of the cryptocurrency hype, in New York at a large congress, where a startup came to talk about how they would reward housewives with their own cryptocurrency for creating content. For me, this sheer start-up was the confirmation that we were in a bubble and that it had to burst really fast, to take the press out of the sails and to get serious investors interested.

The internet had the same bubble development, in which many silly internet companies with millions of investments were set up between 1995–2000, resulting in the big ‘dot-com crash’ of 2000. The American Nasdaq fell 83%, shares of companies such as Apple and Amazon even 90% and the entire internet industry was put away as a big ‘Ponzi-scheme’.

Technology Development

What happened afterward in different areas has laid the foundation for the internet as we know it today. The technology developed rapidly, problems with scalability, speed, and security were tackled rapidly and the “mainstream” use followed quickly and grew exponentially for a long time. Blockchain technology is currently going through the same phase, where hard work is being done on a number of dilemmas raised by the use of first versions; safety, speed, and scalability. In addition, issues such as conflicting regulations and standardization.

Where, according to various founders of the internet, governments are late with certain laws and regulations concerning the internet, people are already very pro-active about blockchain technology. Consortia, such as R3 (financial institutions), B3i (Insurers) and Hyperledger (under the leadership of the Linux Foundation) are working on much-needed standards and issues such as certificates and education for the industry. There are hundreds of cool applications, but many are made in their own scripting language, working with one of the no less than 55 available consensus protocols, which makes working together complex.

Underlying Technology

Where ARPAnet introduced the underlying technology (TCP / IP), Bitcoin now does this with the underlying blockchain technology. In the beginning, ARPAnet was intended purely for communication, Bitcoin purely for transactions. ARPAnet provided freedom of information, Bitcoin freedom of value and transactions. Both also cross borders. With both technology emergencies, you saw the existing and endangered industries struggle against in the beginning and governments tried to curb the emergence with laws and regulations. As with any technology, the use of criminals was initially regarded as the reason why it should be banned, and both were initially a technology, not an entire industry.

As I wrote in a previous blog, we now have to wait for the big “Killer App”, which will make blockchain known, familiar and usable for the general public. Just like Netscape did with its browser for the internet. The development of technology under the internet; TCP / IP lasted no less than 30 years before it became known, loved and used worldwide. In the years that followed, it ensured that our society was completely transformed, billions of people came online and that new things were still being built every day that could not exist before. Where would Instagram be without the iPhone? Amazon without the internet? All technology that is further developed on previous technology.

Blockchain Training

Often when I give keynotes or training about blockchain, I can’t answer “where we are going” with this technology. It is impossible to predict because I do not know what developments we can expect after the developments that are currently taking place. It is certain that in the coming years we will soon see products and services that will be simplified and accelerated by blockchain technology. Not only in the financial sector, but in many sectors worldwide. As long as companies focus on solving problems, possibly with blockchain, instead of looking for problems that they can solve with blockchain, support will be broader and investments will be more effective. Just like with great interest I followed all developments in the field of the development of computers and the internet, I will also do this in the field of blockchain in the coming years. we have only just begun!

Jan Scheele is active in the web3 (blockchain, crypto, NFTs, DeFi) industry since 2013. Besides (former) CEO of a web3 scaleup and founder of an advisory boutique (working for governments, family offices and several multinationals), he is Digital Leader at the World Economic Forum and Board Member at the Blockchain Netherlands Foundation (BCNL). He is writing, consulting, speaking and training regularly about everything web3, all over the world. Furthermore, he is currently finalizing his book about the rise and global impact of blockchain technology.

That was not was the intention!

The fact that Satoshi published the white paper just a few weeks after the major financial crash was related to his initial idea of using the decentralized nature of the Bitcoin blockchain to remove power from financial intermediaries such as banks and return it to the citizens. That fact that one of the companies that can be very much blamed for the financial crisis, the JP Morgan bank, recently introduced its own “coin” is a development that can best be described as “special” — especially as this is used for a closed, so-called “permissioned” blockchain that can only be accessed by JP Morgen and selected customers. This is something that completely goes against the open and transparent ideology that has been used for designing blockchain technology.

The same applies to the Facebook “coin”. Experts refer to it as “regaining control over your own data” (or “killer app”, which I discussed in a previous post) which is one of the biggest advantages of the blockchain technology. The fact that Facebook, the company that has been so controversial in recent times due to its disproportionate slurping and abusing of data, is developing its own “coin” has led to many experts ringing the alarm bells; will the decentralized character of blockchain not be lost again, because of a few large companies who will run away with the technology? It is not a thought that scares everybody immediately; when a small percentage of Facebook users use the “coin”, the number of worldwide crypto users would double immediately. That sounds positive for the adoption and further development of the ecosystem.

Further Developments

The most recent research from the European Union seems to confirm this. The study shows that it is precisely the private (often corporate) platforms that drive the adoption, rather than the open ones, such as Bitcoin. This is mainly because the developers of the closed platforms have much more freedom over the further development in the field of safety and speed, where open platform developers discuss and decide these kinds of further developments in a decentralized manner, which often requires a lot of time.

According to the definition, decentralization includes the distribution of various functionalities, power, people and all sorts of things from a central point. This ideology was initially witnessed at various large technology companies such as Spotify, who took away the distribution of music from the major distributors and placed it back with the musicians themselves. Uber did the same as it took away the power from large taxi companies and placed it with the drivers, and Paypal did so too by transferring bank transactions from the banks to the owners of the money. Unfortunately, we see many of this kind of company centralizing power in all kinds of ways themselves by, for example, buying up innovative startups, increasing entry barriers for competitors to a sector, or simply increasing their often almost monopolistic market share.

Blockchain Technology

The same is currently happening with blockchain technology, especially in the area of maintenance (“mining”) of the blockchain networks and ownership of the most important cryptocurrency. The top 6 largest maintainers of the Bitcoin blockchain, the so-called “miners”, control 75% of the global network because of their computer power. Some 75% of all this global mining capacity hails from China. What about the ownership of the coveted Bitcoins? The top 1,000 addresses own 40% of the total number of circulating Bitcoins.

Whereas the so-called “Initial Coin Offerings” (the blockchain alternative of the IPO of a company) contained many beautiful, decentralized properties, the so-called “Security Token Offering” (which I referred to in my previous post as the most-hyped cryptocurrency of 2019) has again had a lot of dealings with central authorities. Stablecoins too (which I previously described as a very important development in the field of cryptocurrency) remove the important, decentralized properties such as executing transactions without an intermediary while it is exactly these properties that made cryptocurrency so popular and practical.

Dutch Central Bank

Someone from the Dutch Central Bank recently asked me about the impact of blockchain during my keynote and “whether you want to decentralize everything”, whether it is good to remove authority where possible and place the power back with the citizen. Various platforms that aimed to do this with via the Internet in the past few years suddenly faced their social limits in many ways, after which everyone turned to the central governments for measures. It’s nice that they are still around, isn’t it?

Personally, I do not believe that every part of society is better off decentralized. However, I do already see many groundbreaking applications of the blockchain technology that, by means of decentralization, can have a tremendous impact on our society, and that would not have emerged if they were governed centrally. And this is despite the fact that we have only just begun development….

Jan Scheele is active in the web3 (blockchain, crypto, NFTs, DeFi) industry since 2013. Besides (former) CEO of a web3 scaleup and founder of an advisory boutique (working for governments, family offices and several multinationals), he is Digital Leader at the World Economic Forum and Board Member at the Blockchain Netherlands Foundation (BCNL). He is writing, consulting, speaking and training regularly about everything web3, all over the world. Furthermore, he is currently finalizing his book about the rise and global impact of blockchain technology.

Housewives generating content, Geert Wilders, bananas and managing your own grave. These are just some bizarre examples of focus areas of the many thousands of so-called “Initial Coin Offerings” (ICOs) that took place in 2017 and 2018. Although many blockchain experts initially saw ICOs as a way of setting up a community around an organization, most organizations mainly used their ICO to quickly and easily raise money from investors. Therefore it has become a form of crowdfunding for blockchain projects, where investors can participate for small amounts and receive “coins” or “tokens” in return. According to research from PWC, ICOs raised $10 billion in 2017 and $11 billion in 2018, which amounts to an average of $25 million per ICO. The largest ICO, EOS, raised no less than $4.2 billion.

The combination of the ease with which organizations collected money, the poor due diligence from (mostly new and inexperienced) investors, and the lack of regulation from governments lead to an enormous amount of fraud. Of the many thousands of projects, 81% ultimately turned out to be scams and always almost left the investors empty-handed. Many large investors are calling for measures to prevent scams and to restore confidence in the cryptocurrency market. Many studies confirm this and indicate that regulating the market will also result in a significant increase in investment. This would not only be from current investors, but also from the large established financial service providers that currently wait for this to take place.

The Next Step In Cryptocurrency: STOs

One of the most frequently-cited trends in cryptocurrency for 2019 is the Security Token Offerings (STO), which is also referred to as the solution to the above-mentioned problems and which is expected to facilitate $10 trillion in transactions in 2020. The concept was introduced by PolyMatch and there are now around 150 STOs active worldwide.

When talking about obtaining crypto or token in exchange for financial investment, Security Token offerings are very similar to the well-known ICOs. However, where an ICO does not have any voting rights, has no underlying value and is mainly used for access to an application or speculation on future growth, an STO makes you the owner of a real investment product, which is linked to an underlying asset, such as a share.

Performing an STO is a lot more complex since you have to comply with a lot of regulations and have to go through all sorts of complex procedures in order to comply with these regulations. This is also the main reason why most startups convert their plans for an ICO into an STO. It also prevents a lot of scams as the many background checks almost make it impossible for a scam to survive such procedures.

Why Not A Regular IPO?

Many traditional financial experts wonder aloud why STOs are needed instead of simply continuing to work with regular IPOs that have been used successfully for decades. I personally consider ICOs a great step towards more financial inclusiveness. Where regular IPOs, such as those of Adyen, can only be entered into by large institutional investors, most ICOs can already be supported with just a couple of tens. In addition, it makes it a lot easier for startups to raise money and grow a community, without having to search long for the right Venture Capitalist or bank.

There are a number of differences between IPOs and STOs, which make the latter very interesting. STOs can be traded 24/7 and are settled almost immediately, whereas IPOs can only be traded only during opening hours of the stock exchanges and, as a result, it sometimes takes days before the transaction is settled. By using so-called “smart contracts”, it is possible to pay out dividends and acquire treasury shares automatically. In addition, smart contracts remove many intermediaries and their work, which in turn saves a lot of time and money.

But Why Don’t We Immediately Switch Completely To STOs?

During the training sessions on blockchain and cryptocurrency that I am allowed to give, financial experts often ask me why STOs are not already more well-known and why they are not being used more often. I find Security Token offerings a very interesting tool for protecting the sector from scammers, making it a lot healthier and more trusted. However, it completely contradicts the decentralization for which blockchain was originally conceived. As STOs are under the strict supervision of the financial authorities, such as the AFM in the Netherlands and SEC in the United States, Security Token offerings are a no-go for many blockchain enthusiasts. One of the best-known cryptocurrency exchanges, Binance, has announced that they will not support STOs.

Other big names in the industry, such as Coinbase, state that they will start doing so from the end of this year. Some countries, such as China, have prohibited STOs because they see them as “illegal financial activity”: “I want to warn those who are promoting STO fundraising in Beijing. Don’t do it in Beijing. You will be kicked out if you do it. You can only engage in such activities with the approval of the government” (Huo Xuewen — Hoofd Financial Bureau Beijing)

What Are The Next Steps?

The first Dutch STOs have already been announced, such as van Ockel and Blockport (update: the last one was aborted). Various sites show in easy step-by-step plans how you can establish an STO, such as that of the “inventor” of STOs, Polymath. There are also several nice overviews of STO projects worldwide. Ultimately the investor is the smiling third; they can invest in companies easier, faster, safer and cheaper.

Jan Scheele is active in the web3 (blockchain, crypto, NFTs, DeFi) industry since 2013. Besides (former) CEO of a web3 scaleup and founder of an advisory boutique (working for governments, family offices and several multinationals), he is Digital Leader at the World Economic Forum and Board Member at the Blockchain Netherlands Foundation (BCNL). He is writing, consulting, speaking and training regularly about everything web3, all over the world. Furthermore, he is currently finalizing his book about the rise and global impact of blockchain technology.

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The quest for the new Apple

The rapid rise of blockchain technology and cryptocurrency has also resulted in the growing popularity of “Initial Coin Offerings”. Over the past two years, several startups have managed to raise tens of millions of euros in a few seconds, making many of their investors very wealthy despite only being active for a few hours. This is something that is impossible in the regular financial market. According to research from PWC, $10 billion was raised in 2017 and $11 billion in 2018, which amounts to an average of $25 million per ICO. The largest ICO, EOS, raised no less than $4.2 billion.

However, several national and international authorities, rightfully, point to the dangers of investing in these ICOs.

ICOs?

ICOs are a sort of crowdfunding, usually for projects on the blockchain. In exchange for an investment, the lender receives coins or tokens. Whereas startups such as Adyen raise money with a normal IPO, only large, institutional investors can participate. ICOs also allow investors with a small budget to invest. However, ICOs often do not have a working product or service yet, and since there is no central authority controlling their activities, there is nobody you can approach when something goes wrong. Therefore, it can be considered risky; research by PWC showed that no less than 81% of ICOs turned out to be scams.

Since money is being raised for the development of an idea in particular, rather than the further development of a product, the prices of the coins made and issued at an ICO are often very low. However, if the product becomes successful, the return will be insane. That is why many people are looking for the “new Bitcoin” or the “new Apple”, whose shares have grown in value by 29,000% since the first time they were issued.

Here are my top 8 tips for finding a good ICO to prevent you from becoming the owner of a bag of coins that are worthless.

1) Team

Despite having a good idea or great product, if someone is surrounded by the wrong team, it will be likely that the startup will still fail. That is why it is important to seriously research the individual founders, team members, partners, and advisors. For example, do they have the relevant experience in crypto and/or blockchain technology and in the market in which they want to be active? Obviously, you want to have people who have years of experience in the industry in which they want to operate and who have actually achieved something in this regard. ICOs have an important extra point that requires attention: does the team exist? There are many cases where the team members and advisers did not exist or were not involved in the project at all, which was often a precursor to a scam (fraud).

Therefore, carefully check the Linkedin/Twitter profiles of those involved too. Are they active? How long have they been active? Is it clearly stated that they also work for the ICO? Some ICOs drop the names of important people as being their advisors (such as former Prime Minister Balkenende) while, in fact, those people have had absolutely nothing to do with the ICO.

2) Why?

“Just because you can, doesn’t mean you should” — Sherrilyn Kenyon

Unfortunately, many ICOs have fallen into the “me too” trap; they made a cheaper, faster version of something that already exists instead of developing something really insanely disruptive that perfectly responds to the blockchain. As an investor you, obviously, want the product or service to be really sought after. That is why it is very important to look at the “why” of the ICO. Will the concept possibly replace the competition? Will it be the answer to visible or predictable market demand? Have clear, specific goals been defined? Is it for long term use? Is it market individuals, organizations, companies?

Will large, existing companies were not able to develop this much easier, faster and better themselves? The clarity with which this has been described will also have an impact on the team. In the most ideal situation, the team will be able to already show a prototype or proof of concept.

3) White Paper

Thorough deliberation of the “white paper”, a hip term for “business plan”, will be key in judging an ICO. The website can be beautiful and a lot of marketing can be done, but if the concept lacks a strong white paper that explains the concept then you will have to ask yourself whether you want to invest. Apart from the concept, issues such as the background, goals, and strategy of the ICO also deserve attention. It is certainly worth investigating the implementation and development “roadmap”: the “why” described above, the way success and goals will be measured and what potential obstacles have been identified. Furthermore, the legal relationships between investors and the ICO, the issuance of the coins/tokens (how and when this happens) and the financial models are important to validate credibility and reasonableness.

4) Community

A good ICO has or is working on, a large, strong community that is fed updates regularly. That is why it will be good to investigate whether the ICO and the individual team members are active on social channels such as Facebook, Twitter, and Reddit. Many good ICOs also have a good, open support community on Slack and Telegram.
 
 But … is the ICO not active on the largest forum in this field, BitcoinTalk? That will justify the immediate discounting of it as a possible investment. Check this forum too to see how the team responds to questions and comments and whether the people who respond are not brand new members of the forum. A good ICO has no so-called “bounty posts” (paid messages that spread good news). Make sure you are aware of this.

5) Website

Way too many ICOs still use a standard WordPress or WIX template for their website, unfortunately. A website is really an important part of the success of the ICO because this should attract investors and customers. That is why it is important to review the website very carefully. Bad design is often because a team does not want to invest enough time and money in smart marketing. This will be a death blow to the project. Have a good look at the design. Does it look professional? What kind of images has been used? How is the concept explained? Is it easy to understand? Many ICOs try to impress potential investors by using all sorts of weird terms that they often cannot even explain to their own friends. The same applies to the reason why blockchain should be used: this is often farfetched.

“If you can’t explain it to a six-year-old, you don’t understand it yourself.” — Einstein

6) Code

Obviously, an ICO wants to be as open and transparent as possible at the start. The code of the project is an important part of this and which is almost always published on Github. Github is the world’s most popular online tool for collaborating on (mostly open-source) software. The management of it and was recently acquired by Microsoft.
 
You can analyze the code and determine the quality of the ICO in various ways. One way is to look at the number of “commits” (adjustments). Another is to review the “Insights” tab for the general summary of all developments. The consistency and length of the code (functions with more than 50 lines of code must be immediately rejected) and the processed comments are good parameters for quality too. If the ICO does not disclose the “smart contract node”, it is either unstable or the code has probably been copied from another ICO. These are both certainly good reasons to stop considering investing.

7) Token Sale Distribution

When reviewing the distribution of the tokens, you obviously want an ICO that would rather issue few tokens at a low price. When you are looking for an investment that will experience a large increase in the long term, then it must, of course, have the lowest possible valuation and price (review the increase of coins on Coinmarketcap that have a supply of less than 100 million). If the opposite case is you, you would often see that a price drop occurs quickly after the launch of the ICO. This stabilizes the net asset value. You can, therefore, ask yourself whether an ICO that wants to raise 50 million to build a product that will yield 1 million per year is worth the investment.

Also, consider the distribution of the tokens; how many are sold, distributed to advisers or ultimately end up with the team? Some teams take it too far by paying themselves more than 50% of the tokens as a reward for rendered (but yet to be proven) services.

The correct distribution of tokens is linked to the roadmap since every step in the development needs some financing. This folder also always indicates correctly when the tokens are being issued. Will this be immediately after the ICO or only when the beta version of the product has been launched?

8) Seat Of The Company

Many ICOs that later turned out to be scams were hiding behind a “shell company” on a tropical paradise. It is worth establishing when the ICO is seated. Is there a clear contact address and is the Initial Coin Offerings (ICOs) really located here? Although the world lacks laws at ICO level, in most countries it is legally possible to tackle fraudulent companies and individuals.

This post does not provide financial advice and should not be viewed as such. It is my own framework and should only be viewed from an informative perspective. Make sure you do your own research before you invest in an ICO!

Jan Scheele is active in the web3 (blockchain, crypto, NFTs, DeFi) industry since 2013. Besides (former) CEO of a web3 scaleup and founder of an advisory boutique (working for governments, family offices and several multinationals), he is Digital Leader at the World Economic Forum and Board Member at the Blockchain Netherlands Foundation (BCNL). He is writing, consulting, speaking and training regularly about everything web3, all over the world. Furthermore, he is currently finalizing his book about the rise and global impact of blockchain technology.

In the last month, I made a wonderful trip with my father through Brazil. The destination was also one of the highlights; the carnival in Rio de Janeiro. Being a blockchain fan, I was very enthusiastic to witness how one of the schools that colored the fantastic parade had chosen the theme “the evolution of money” and, subsequently, also had dressed a few people like Bitcoin. The popularity of cryptocurrency has risen sharply in South America recently, mainly due to the instability of the regular (fiat) currency in countries such as Venezuela, where thousands of predominantly small companies now accept the well-known cryptocurrency Dash. Let’s see how blockchain technology will impact the Tourism sector.

For a few years already, I have had the pleasure of carrying out various advisory processes for governments at home and abroad in the field of “Destination Marketing & Management; improving its findability and visibility of a destination”. A frequently asked question various governments posed me in recent times is ‘what will be the impact of blockchain?’ and ‘what is currently happening in the sector regarding this topic?’. The sector was valued at over $7.5 trillion (10% of global GDP) in 2018 and generates over 100 million jobs directly, according to the United Nations, and this obviously makes it interesting to review the many ways in which technology can and will have an impact. My top 10:

Demolishing The Power Of The OTAs

The power of Online Travel Agents (OTAs), such as Booking.com and Expedia, is a growing annoyance for many hoteliers and airlines. Apart from the high fees charged by OTAs, the loss of vital customer data and the increasing monopoly and additional effects are becoming a problem for affiliated companies. One of the best-known attributes for which blockchain is widely praised, and which will cause major breakthroughs, is its ability to cut out the middleman. Last year, the CEO of TUI already expressed his expectation that the technology would make “monopolistic intermediaries” (in his view, OTAs) disappear in the coming five years.

Several cool blockchain startups are already working on a solution to make this become reality. The best known is Winding Tree, which has developed a decentralized marketplace where hotels, airlines and tour operators can assist their customers directly. Contrary to the current OTAs, the platform lacks the drive for profitability or aim to obtain the biggest possible market share. It has recently managed to attract many important partners, such as KLM, Lufthansa, and AirCanada. In addition, there are also destinations that use the Winding Tree platform, such as Aruba. At present, a handful of OTAs is collecting the bulk of the revenue that the 1 million plus tourists generate for the country. By offering its own token, the country wants to decentralize its offering and grant both small and large players the same opportunities.

OTAs – tourism sector

In addition to Winding Tree, there are around twenty other companies that are competing with the OTAs. Webjet from Australia focuses specifically on hotel bookings and has already signed up Thomas Cook and a number of very large Asian hotel chains as partners. Locktrip too focuses on hotels and has already linked 100,000 hotels to its platform. It claims to make bookings 19% cheaper on average and has recently substantiated this claim. Other well-known parties that are also pursuing greener pastures are Atlas, Blockskye, and KeyoCoin.

The Decentralized Business Sector

Just like the OTAs, blockchain will also have an interesting impact on the business sector. Several start-ups with proofs-of-concept have already developed a decentralized solution for well-known platforms such as Uber and Airbnb. One of the best known is Beetoken, which connects landlords directly with potential tenants and encapsulates the entire process, from securing payments to reviews once the agreement has ended. It wants to end the many scams that currently affect Airbnb and charges a commission that is only 20% of the fees that Airbnb charge.

The company Slock takes it one step further; they want to help the business sector in different ways by, for example, granting safe access to different types of IoT devices such as the lock of the door of a rental apartment. By arranging the entire process of concluding a transaction, including payment, to user verification and granting access, they believe they offer accommodation owners a complete solution. Organizations that are creating similar solutions are Populstay, Travala, Trip.io, and Travelblock.

Of course, the large business sector platforms recognize both the opportunities and the threats of blockchain technology. They themselves have already started implementing the technology. For example, Airbnb has acquired the ChangeCoin startup, mainly to incorporate blockchain specialists into its business. It is not known if Uber has any concrete plans to use blockchain but several parties, such as DAV, Fairride and Lazooz, are already working on making a decentralized alternative for Uber.

Digital Identity – tourism sector

One of the major problems the tourism sector faces is the identification of people. Issues like fraudulent payments and bookings result in high costs for companies. The various times at which a customer has to identify him/herself results in wasted time and therefore annoyance. There are already several companies, such as Shocard, that have used blockchain to devise unique solutions, making the entire process much faster, more efficient and safer. So-called ‘smart contracts’ can automatically check whether all documents, such as passports and visas, are valid and can grant access to an airport, and also store the identity document (such as a passport) on the blockchain, to enable to verification of the identity at any time.

The unchangeable and distributed nature of the technology prevents fraud and helps the entire process to take place quickly and efficiently. The implementation of this is already at an advanced stage in countries such as Dubai and Aruba, while in Spain a system that only focuses on identification has already been successfully adopted.

Real Ratings & Reviews

A holiday was previously booked through a travel agency or tourist office, but now the way in which we choose a destination and book a holiday has changed completely. Many studies show that 84% of consumers consider online reviews on Google and platforms like Tripadvisor as important as word-of-mouth recommendations from friends, while 87% will not even book with a company that has negative reviews.

Unfortunately, this is also being misused; research has established that 85% of companies in the tourism sector are plagued by fake reviews. The English newspaper The Times claims that one-third of Tripadvisor reviews are fake and Harvard Business School calculated that 20% of Yelp reviews are fake.

Several friends that run a business in the sector tell me that they are sometimes even being blackmailed to offer something for free to prevent a negative review despite this is often not even justified. Blockchain technology can make a major breakthrough here since the information published on it is transparent and cannot be changed. Companies like Revain and Chlu have devised solutions that ensure that reviews can no longer be faked, changed or deleted. These are important solutions for this ever-growing problem in the sector.

Fast And Affordable Payments

The first blockchain, that of Bitcoin, began as a purely electronic “peer-to-peer cash system”, to enable digital payments without a middleman. The many applications that have already been successfully implemented, therefore, largely cover the field of ​​payments. As the global hotel industry alone was worth nearly $500 million in terms of revenue last year, you can probably imagine the insane number of transactions that are taking place in this industry. When we consider the costs that this entails, like fees charged by credit card companies and the previously-discussed OTAs, using blockchain can save a significant amount of money for both the provider and the buyer here.

In addition, there are already several companies that make the transactions significantly faster and the technology itself makes the whole experience a lot safer and more traceable. Many destinations and organizations already offer payments in cryptocurrencies, such as San Francisco, Argentina, Queensland (Australia), Germany, Dubai, hotels and various booking websites. Ireland even goes one step further and introduced the IrishCoin to reward tourist loyalty in addition to payments generated. Greece has introduced “NautilusCoin”.

Becoming And Staying Loyal

Loyalty programs are very important for many organizations active in the tourism sector. However, the problem with the current programs is that consumers often do not really understand these programs and that companies often, unfortunately, fail to extract the desired data. A recent report from consultancy firm PWC describes the great opportunities loyalty programs offer when placing them on the blockchain. Collected loyalty points can be saved on the blockchain and, therefore, are immediately exchangeable and visible for the user. On the other hand, organizations can save advertising costs by making real-time, personalized offers based on the data generated and customer profiles, while fraud can be prevented.

By sharing the data with chain partners (for example, an airline, car rental company, or accommodation owner), even more, interesting data can be obtained while the “booking experience” by the consumer can be optimized even further. Apart from various organizations, several countries have also placed their loyalty program on the blockchain. A well-known company that facilitates this service is Loyall, which is already used by the governments of Dubai and Norway. The companies Trippki and Deskbell have solely focused their solutions on the hotel industry.

Saving Data Securely

Not having access to their own data and systems cause nightmares for many companies. Hackers are becoming increasingly smart and nowadays install so-called “Ransomware hacks”, which means that a person or organization can only access data once a ransom has been transferred. This became painfully clear in Austria last year, where a hotel was hacked and only regained access to the hotel room keys once ransom had been paid to the hackers.
 Due to its decentralized and cryptographic nature, blockchain technology offers a great solution for safer data storage to prevent this being lost due to a cyber-attack or, for example, accidental deletion.

Never Lose Luggage Again

The loss of luggage is one of the biggest annoyances for travelers. In addition to being without clothing, not knowing where items are is very annoying and is a bad start to a journey. Last year, the international flight organization IATA stipulated in Resolution 753 that airlines should increase the number of scanning points for baggage during the journey and make these points more compatible. At the moment, blockchain is being considered in order to make the entire process, from baggage drop-off to receipt by the owner, more transparent. By giving each item a unique code, constantly scanning it and logging its location in the blockchain, the exact location of a piece will be visible in real-time. This will not just provide a great solution to consumers but also, for example, for the transport of goods.

Fewer Empty Seats And Beds

Although various technologies, such as AI and ML, have reduced the number of empty seats on airplanes and empty beds in hotels, this is still a major financial problem for providers. Travel organization TUI was the first company to publicly state that it had put all its data on the blockchain. The company, with a turnover of almost €20 billion, can view the total hotel bed stock in real time and, based on big data, still offer flexible margins through various partners. According to the CEO, their “BedSwap” project allows them to save many millions of euros per annum. The Austrian startup Avinoc does something similar to airplane seats.

New Ways Of Traveling – tourism sector

Recent research shows that millennials trust cryptocurrency better than shares, and as a result, the popularity of digital assets among young people is therefore high. Many organizations use this knowledge cleverly by offering special trips. Not only do they offer trips in cryptocurrency, but they also offer Blockchain Cruises for fans of this technology, an Airbnb for crypto dealers called CryptoCribs, and various tours to blockchain hubs like Zug (Switzerland).

Destinations On The Blockchain

In addition to the tourism companies and many technical suppliers with their platforms, several countries are already proactively working to apply blockchain technology in different ways within their own tourism sector. Dubai aims to have the first “blockchain government” in 2020 and already offers various working solutions with the technology, such as a decentralized distribution channel for hotel rooms. Moldova witnessed a significant increase in medical tourism through the use of blockchain technology while the head of tourism for the Russian government, Oleg Safanov, said the matter has top priority in its department. Australia even has its first Digital Currency Town.
 
According to the many companies that are working on solutions, cool new blockchain solutions for the tourism market are released every week. The question of how this will impact the industry makes me very curious!

Jan Scheele is active in the web3 (blockchain, crypto, NFTs, DeFi) industry since 2013. Besides (former) CEO of a web3 scaleup and founder of an advisory boutique (working for governments, family offices and several multinationals), he is Digital Leader at the World Economic Forum and Board Member at the Blockchain Netherlands Foundation (BCNL). He is writing, consulting, speaking and training regularly about everything web3, all over the world. Furthermore, he is currently finalizing his book about the rise and global impact of blockchain technology.