Corruption is good for blockchain.
Actually, the real quote is “Necessity is the mother of invention.”
Which basically means, “when the need for something becomes imperative, you are forced to find ways of getting or achieving it.”
And that is why we went to Ukraine.
Two of the many meals we shared together.
This past week, Explorer Partnership members spent several days in the capital of Europe’s largest country – Kyiv, Ukraine.
We were joined by local guests who were doing a variety of interesting things in the country. Everything from blockchain technologies to real estate was discussed.
But why go to Ukraine?
Well, frankly, Ukraine is corrupt. I won’t dive too deep into the country’s problems, because even I don’t fully understand everything that is going on.
But here is the most important thing about corruption: Trust is gone.
It’s actually hard to understand how corruption can affect a society to its core. Corruption, which generally originates from a government, spreads to everyday people.
Simple business transactions – even buying groceries at a store – can be a challenge.
But, wherever there are challenges, there are solutions. And that is what we discussed… the solutions that Ukrainians are creating to overcome these corruption problems.
One major issue is property ownership. In order to attract investors, a country must have solid property rights. Why would anyone invest in something they’re not even sure they own?
Well, the answer is that they aren’t. People are not investing. Instead, they are pouring money into more reliable economies.
This is wrecking havoc on Ukraine.
For perspective, Orlando, Florida (population 2.3 million) has a higher GDP than the entire country of Ukraine (population 45 million).
Perhaps that’s why Ukraine’s population is decreasing. Ukrainians are leaving in search of better opportunities.
But, that’s not the whole story. While the government is failing Ukrainians, local businesses and entrepreneurs are coming up with solutions to fix this disaster.
Two entrepreneurs we met are working on a blockchain based real estate investment. Essentially, investors are issued a cryptocurrency token which represents their share of a real estate investment.
Because it’s blockchain based, there is no ‘double spending’ and all transactions are transparent via an open ledger. This ensures that property ownership is properly accounted for and all information is decentralized. Or in other words, there isn’t a central entity (government) that can change the rules (get paid off).
Ironically, Bloomberg ran a very similar story the day we got back from the trip:
I believe that this will be the future for all ownership records. Whether it’s real estate, vehicles, or intellectual property.
Blockchain technologies will allow transparent records that can’t be skewed by corruption.
But, in order for these technologies to really take off, the public has to realize how devastating centralized powers can be.
Whether it’s the Federal Reserve, the International Monetary Fund, or the government of Ukraine… the best solutions come from the worst problems.