Malta is truly the first country in the world to have proper Blockchain regulation and it’s helping to build a long-lasting ecosystem on the island, according to Abdalla Kablan.
The young mathematician and entrepreneur is the founder of DELTA Summit, a Blockchain conference bringing all the companies and personalities in this space to Malta.
“Malta is doing everything properly. Once you start with an idea, a dream, you need to set the proper roadmap. And when it comes to Blockchain, the issue globally is the lack of regulation.”
Regulation means peace of mind for people investing in this new technology as long as they follow there rules. But it also means regulation that’s specific to this technology and not just a transposition of traditional financial regulations which do not cater for such groundbreaking developments.
“A lot of companies are leaving because their traditional regulations in their jurisdictions just could not understand their offerings,” says Dr Kablan, who was himself involved in building Malta’s regulatory framework.
He is confident the technology is here to stay and dismisses the superficial comparisons some people have made with hype-driven technologies like Google Glass.
“Google Glass is a product. Blockchain is a technology,” he says, emphasising how much can be built on this technology – mostly things we cannot even fathom today.
“Bitcoin is just a product built on the Blockchain to fulfil a financial service. But on top of that you can have health records, certificates, supply-chain management for farmers to track their produce from the day they harvest to the day it gets sold in the shop. It eliminates a lot of the middlemen transactions,” he says.
“The best example that is comparable to Blockchain is the Internet itself. With the Internet we democratised information. With Blockchain we’re democratising value.”
Dr Kablan is quick to admit that the technology will not only be used for good.
“As with every technology in the world it can be used for good purposes or very bad, malicious purposes. Take the knife. You can cut fruit with a knife, but you can stab someone with it too. The internet itself was used for good purposes and bad purposes.”
So what’s the worst-case scenario for a country like Malta that’s going knee-deep into this?
Dr Kablan prefers to start with the best-case scenario.
“The best-case scenario is that we create a thriving ecosystem here that is comparable to what Silicon Valley has done for tech startups. We can be the Silicon Valley of Blockchain worldwide,” he says, emphasising how much talent, capital and investors are coming to the island.
“A bad-case scenario is having companies fail and collapse. But in an ideal case, even when that happens they would fail and collapse because the business would not have picked up, not because of any malicious intention.”
But if Malta builds an infrastructure that’s dependent on Blockchain, what happens if things fail?
“We are doing our best to create an ecosystem with as many projects as possible, so the collapse of one project won’t affect the whole ecosystem,” he says.
“We cannot create regulation for just very few players to come and play, and expose ourselves to the risk of being completely reliant on that big giant that moved to Malta, and if something happens to them they would just drag the whole system down.”
Dr Kablan believes the opportunity for Malta is even greater than it was when the country took advantage of the gaming industry.
“When Malta regulated gaming, gaming regulations existed elsewhere, so we just managed to create a better, more robust and efficient regulatory framework. With Blockchain we’ve started virtually from scratch.”
So will we have more staying power in Blockchain?
“Using gaming analogies, my bet is on Blockchain,” he says.