As part of the recent Australian Blockchain Week, YBF Ventures hosted a showcase of Blockchain start-ups – not a standard pitch event, but more an opportunity to hear how some teams are deploying Blockchain technology in their projects.
Here are the projects in order of presentation (links in the project names):
ProvenDB – developing immutable and tamper-proof document management, built on Hedera Hashgraph
BuildSort – a construction contract management solution to improve the industry supply chain and project management
Laava ID – product authentication via “smart fingerprints”
Verida – decentralized identity (with a focus on health records) – a user-centric solution focused on building user trust – resulting in hyper-personalisation
Cryptocate – crypto tax management service – with the growth in DeFi, there is a lack of data standardization or formal tax guidance on taxable events – e.g., how to handle crypto options?
Elbaite – a non-custody exchange using a “TraderTrust” verification system to support P2P transactions – platform confirms the exchange transaction on-chain, then the platform uses the transaction hash to release clients’ fiat funds from escrow – platform charges fees and commission
Sempo – a remittance service, with a particular focus on supporting migrant workers, the unbanked and refugees
Future CX – decentralized middle-ware development – e.g., data containers, NFTs, smart contracts – using a “proof of distribution” model
Luca+ – e-invoicing solution that integrates with major third-party accounting software
BC Gateways– using Blockchain to facilitate secure data transfer within the superannuation industry – recently acquired by IRESS – scaling from 10k transactions per day to 5m per annum
DayByDay – an asset management solution for the insurance industry
Blockchain Australia, the national industry body, recently organised the first National Australian Blockchain Week – a mix of on-line and in-person events, hosted in Sydney and Melbourne. Overall, it was an impressive line up of speakers and topics, featuring key local figures and presenting some intriguing announcements from politicians, regulators and practitioners alike.
The recurring themes were: Regulation, Tax and Innovation.
Despite past pronouncements about adopting a light-touch regulatory regime when it comes to Blockchain technology, the absence of definite regulation risks stifling innovation and/or driving projects overseas to more receptive jurisdictions. (Irony of the week #1: contrast this with the early and positive regulatory engagement with Digital Currency Exchanges (DCE) and other market participants in Australia, not to mention previous progress in removing the absurd GST treatment on the purchase and sale of cryptocurrencies).
Now, the industry is (once again) asking policy makers: to clarify the law as it relates to decentralised protocols, digital assets and utility tokens; to streamline the confusing and over-complex tax system as it applies to DeFi: and to define a specific regulatory boundary (rather like the UK’s FCA perimeter) within which crypto assets need to be regulated. Sadly, the latter is extremely hard to acheive thanks to the very broad definition of “financial product” within the Australian Corporations Act.
Throughout the four days, there were several highlights: Senator Bragg’s keynote speech on driving the policy agenda to bring clarity to regulators and markets alike; a progress report on the National Blockchain Roadmap; tax and legal updates from Joni Pirovich and Michael Bacina; a showcase of local Blockchain start-up projects (more on that next week); and a couple of enterprise presentations on the ASX’s DLT replacement for CHESS and the Blockchain-based insurance project between the R3 consortium and Grow Super. But apart from a couple of other Blockchain-in-business sessions, there was a noticeable absence of corporates, major banks, traditional financial services and institutional investors.
There was a lot of commentary around the fact that many Blockchain businesses and crypto projects still find it challenging to access regular banking facilities in Australia (Irony of the week #2: Westpac’s windfall from the recent Coinbase IPO). There was also a lot of discussion about the need for investor education before crypto and digital assets can go “mainstream” – which I find surprising when plenty of people seem to be finding their way without any help from traditional financial advisors, and yet no-one is required to educate themselves before their money is put into compulsory superannuation or real estate assets. Even where crypto assets are being included in retail investor products, the allocation is very modest and is being transacted offshore (see Raiz’s 5% allocation via the US-based Gemini Trust). Why not use one of the several established and well-run exchanges, crypto funds and OTC providers here in Australia?
Regarding the potential offshore brain drain, much was made of the work that Singapore is doing to attract Blockchain and crypto businesses. But I think the focus on Singapore risks overstating the situation there, and overlooks what is actually happening (and could happen) in Australia. For example, while Singapore may have more favourable tax arrangements for new Blockchain projects, I understand that ordinary retail investors don’t have access to crypto funds (not even ETPs). The Singaporean issuance of digital assets via tokenisation has to be done via an SPV structure. And while many ICOs have been issued from Singapore, they could not be marketed to local investors. At least Australia has a robust DCE sector, e.g. Independent Reserve, BTC Markets, and Bit Trade (now part of Kraken); early on we saw some very successful retail products such as CoinJar; and the local industry continues to nurture innovative decentralisation projects – we just need to sort out those “policy settings”, and give more encouragement to local entrpreneuers and innovation. (Irony of the week #3 – when former ALP politician and self-styled crypto OG, Sam Dastyari, was asked if the private equity fund he works for was investing in Blockchain or crypto, there was a deafening silence…)
Finally, one of the main benefits of Blockchain Week has been to entice people out of hibernation, and to attend in-person events after months of lock-downs and restricted movement. It felt good to be back.
One evening last week, I came home to find two separate deliveries waiting on my doorstep. Both had been delivered in error. The first was a bunch of flowers, but the named recipient, the street address and the suburb were all incorrect – it was for someone else in another postcode. The second was a packet of coffee beans (part of my monthly subscription), but I had already received the same delivery the day before – so this was clearly a duplicate. Welcome to the perennial logistics challenge of the “last half-mile”.
It seems that despite the increased demand for on-line shopping and home deliveries during lock-down, supply chain logistics are still struggling to find a consistent and reliable solution. Coincidentally, in recent weeks I have been pitched two different start-up ideas that aim to address the last half-mile challenge for e-commerce. Although they are each taking slightly different approaches, both start-ups are trying to address the “recipient not at home” dilemma – what to do with parcels and deliveries when there is no-one at home? Their respective solutions revolve around a “localised point of collection/delivery” – either using a more convenient network of click & collect facilities, or a network of trusted neighbours to receive deliveries on your behalf. I have previously covered another Melbourne start-up called Passel based on a network of trusted local couriers – but it doesn’t seem to have progressed very far.*
So if this is a recurring theme, why can’t it be fixed – or are the solutions out of step with the actual problem? Or is the problem not that big of an issue to warrant over-engineered answers? In attempting to provide constructive feedback to both the recent pitches, I gave similar responses in each case, which can be summarised as follows:
Using a proxy recipient still does not solve the problem of items being delivered to the wrong address (or wrong items delivered to the correct address). In particular, it doesn’t address the issue of Australia Post personnel carding an item as “not at home” when in fact they simply can’t be bothered to attempt delivery and prefer drop it off at the local Post Office for collection – believe me, I have had more than my fair share of those.
Localised click & collect services already exist – usually in convenient locations, and often accessible outside Australia Post’s normal hours. Plus more parcel locker and similar services are appearing – so is the demand really there for another delivery solution?
Who is responsible for insurance claims on lost or damaged packages, where the named recipient (who has the sales contract with the seller) does not match some of the relevant transaction details associated with the proxy recipient?
Likewise, if you are using proxy delivery or collection services, who is responsible for managing returns and/or unclaimed items? Some retailers will take items back and offer refunds as a matter of policy – but others won’t or can’t process returned stock, and end up re-selling into secondary supply chains at a discount.
How do you recruit and screen proxy recipients and deliverers, and build trust into the network? How do you avoid an under/over-supply of proxy providers – too few and the system gets choked; too many and it’s not worth their time and effort to sign up.
How do you recruit and service multiple retailers and/or their point of sale and fulfillment providers to make it a viable service for customers who wish to shop from multiple shops and brands?
Who (and how) do you charge for the additional convenience you are trying to offer – retailer, customer, or both? Suggested options include a per transaction fee and/or an annual subscription fee, or a check-out fee which can be rebated based on loyalty or other frequent buyer rewards. But the “convenience premium” cannot be disproportionate to the value of the transaction.
Even with more customised delivery options such as trusted neighbours, the issue of having to be at home during quite wide delivery hours (e..g, 8am to 1pm, or 9am to 5pm) still applies.
Confirming proof of delivery is still a pre-requisite – even more so if using proxy delivery addresses – and potentially adds another layer of complexity.
Finally, the need for immediate “Delivery-on-demand” may be overstated, at least on non-perishable goods, so a constant stream of delivery drones down every suburban street is probably some way off….. but maybe don’t rule it out if we have further pandemic-related lock-downs or continuing challenges in the COVID vaccine rollout.
I’m not sure I fully subscribe to Jung’s theory of Synchronicity, where causally unrelated events occur at the same time, and seemingly take on a significant meaning; in many cases, a coincidence is just that. But recently I have been forced to consider the possibility that maybe Jung was right.
Over the past few months, I have been reading the 12 novels that comprise Anthony Powell’s “A Dance to the Music of Time”. Although I had never read them before, the books were familiar to me through a BBC Radio adaptation broadcast between 1979 and 1982, and a UK television mini-series from 1997.
Last weekend, and quite unrelated, a friend posted some music on-line – recordings made by the band we were in during the early 1980s. One of the tracks was a song I had written at that time, and whose title had been inspired by Powell’s magnum opus. But I hadn’t listened to or thought about this song for nearly 40 years.
Separately, and also by coincidence, in the last couple of days I have been listening to “The New Anatomy of Melancholy”, another BBC Radio series that draws its inspiration (and title) from Robert Burton’s 17th century tract on mood disorders. This series was first broadcast in May 2020 – no doubt prompted by the onset of the global pandemic, with its lock-downs, self-isolation and increased anxiety. And now the programme is being repeated, exactly 400 years after the publication of Burton’s original treatise – and at a time when we need his sage advice more than ever.
Until now, I hadn’t appreciated how self-absorbed (obsessed?) Powell’s narrator, Nicholas Jenkins, is by Burton – he even ends up publishing an academic text about this prescient Elizabethan writer. On one level, Jenkins is a proxy for his literary hero (as well as being Powell’s alter ego), and much of the 12-novel sequence is a response to Burton’s analysis on the causes of, and cures for, melancholia.
All of which may or may not prove Jung’s theory, but there is for me something of a personal thread between Powell, a song I wrote, and the BBC’s recent update on Burton.