NTE 11 | Understanding Blockchain

 

We are going past the digital age. The age has become smarter where digital things have been made smart, such as smart TVs, smartphones, smart watches and all. Fascinatingly, we are now crossing to a new age where technology is inspired by blockchain. Brian Smocovich of BlockApps brings his expertise and shares his deep knowledge about blockchain. More than what it brings to help better the operations of businesses, he also shares interesting insights on how blockchain is promising to be the technological advance that shifts us into a new paradigm past the digital age.

Watch the episode here:

Listen to the podcast here:

Blockchain: Going Past The Digital And Smart Age with Brian Smocovich

I’m here with Brian Smocovich of BlockApps.

Monica, thank you for having me.

Thank you so much for making the time. I look forward to talking with you more about the projects that you’ve been working on. It sounds like you’ve been deep in tech and blockchain for a long time. I wonder why you haven’t written a book yet honestly. It sounds to me like you’ve got some pretty deep knowledge of this space. I’m hoping that we can take all of your deep knowledge and make it easy enough for our audience to understand it. Thank you so much for bringing your expertise onto this show.

I’m happy to help. Maybe a book one day in the stars. I’ve written a couple of articles that people can find online but it’s a high level of commitment.

I can definitely attest to that. Do you put out a lot of content?

Not anymore, I used to write more frequently before I was more so in the space, trying to establish myself. Ever since I’ve been working for BlockApps, bandwidth issues don’t allow me to write as much content as I’d like to.

I’m hoping that this can also bring a little bit of light to the content that comes out of you from your time at BlockApps. It sounds like BlockApps is doing some really exciting things. We talked about it some of the cool partners and new things that are going on. Not all of which you can talk about because it’s BlockApps’ business but of the things that you can talk about, can you maybe touch on a couple of the main sectors that you’ve been most excited to work in?

The sectors that I personally work in mainly are finance, travel, energy and we’ve done some work in ticketing, supply chain, healthcare as well as agriculture. We have clients that cross all pretty much every vertical at this point. It’s that certain clients obviously we can name, certain things are under NDA and hopefully those production applications will be released at some point.

That’s actually a great problem to have, “I have so much business and I can’t tell you about it.” You did mention ticketing though. That’s one that you can talk about, right?

I can talk about ticketing. We didn’t build it but it is on our platform and it’s an application called Upgraded. It solves the double spend problem when it comes to ticket sales. If you have a digital ticket online, Ticketmaster, whatever retailer sells this ticket, say I buy this ticket and then I want to resell it to StubHub. That QR code that goes along with it isn’t made so that other people can’t use it anymore. It’ reusable. Some people show up to shows, they show up to concerts, sporting events, whatever it may be and they can’t get in because this ticket’s been used by someone who re-sold it, even though they kept it for themselves. What Upgraded does puts the tickets on the blockchain to give a single source of truth for the custody of who owns the ticket. Once the ticket changes hands, then the previous owner can no longer use it to get into this event. Upgraded was acquired by Ticketmaster.

You can’t get any simpler than that. We need to stop the fraud on this one basic way. I’ve been looking for the gateway app or not whether that’s an app or an application in any sense, what’s going to be that one gateway vertical or that gateway interaction that’s going to get people to go, “Blockchain’s got value. Now I’m going to ask, I’m going to care about it. Is it on the blockchain? The blockchain has made my consumer experience markedly better.” When is that going to happen where it’s not like a nerd’s domain to talk about blockchain? You were talking about something about ticketing in the airline industry as well.

NTE 11 | Understanding Blockchain

Understanding Blockchain: Most business or front end people tend to know what blockchain is, at least at a very high level, and how it can better the operations of their business.

 

That’s one of the bigger projects that I actually can name. We’re partnering with United Airlines, along with ARC, which is the Airlines Reporting Corporation as well as one of our implementation partners called Blockstack. All of us together are building a Blockchain application for United to help automate and expedite the reporting and reconciliation of airline ticket sales between different vendors. In this instance, it would be a smaller use case, so between ARC and United. What happens is companies like ARC are focused on the reconciliation of tickets when they come through multiple places. If you want to buy an airline ticket, you can buy it through the United website, you can buy it from the travel agent. You can buy it from Kayak wherever it may be. To reconcile all of these tickets in real time in order to get true transparency of the supply, demand, and availability of airline seats is very difficult. The companies that are specifically designed to reconcile generally take a large fee in order to do it. What this will do is a significant decrease in our operational expenses, which would be then hopefully be passed on to the end user.

It might take more market forces than that to get some greater discounts to the end user, maybe not discounts but some actually more accurate and not inflated pricing. I had some friends who lived in Europe, around the same time that we had airline prices go up after 9/11. For them, airline prices went down significantly. In Europe, the idea was people are afraid to travel and we want to keep them in the planes. We want to keep them doing this and not forgetting, working around or deciding that airlines are too frightening after this terrorist attack. I found it interesting that the choices and the response to demographic fear after 9/11 in the States were completely different in terms of pricing. Prices went up quite a bit for a while and then there was a bit of a depression but it was never a fire sale that I heard about in Europe. I keep wondering what’s going to take to incentivize cheap everything. I would love to see cheap everything.

Did you know that they did an analysis of which method they ended up being more profitable?

I don’t, I have no idea. All I know is that it seems like they’re all still in the sky. In terms of distance, an international flight in Europe can still feel like a regional one in the States. Maybe those prices are somewhat comparable. They seem much more depressed because they’re between countries. In general, I’ve noticed that prices are pretty cheap regionally or within a certain geographic area in other places, not quite so much in the States. Like in Asia as well as in Europe has been my experience. I totally look forward to being able to cut out some of the fat in there and see if we can bring the airline industry into alignment with their international applications and other places.

It depends. If you want to go to Chicago, I’m sure you can get a $100 ticket but you’re going to be freezing.

You have to definitely be ready to have a bit of discomfort one way or another no matter what. You’ve been working in blockchain for a while now. Has it been a few years?

I’ve only been officially in the blockchain space with BlockApps since November of 2017. Before that though, I was doing some pretty deep research into blockchain. Before I worked for BlockApps, I worked for a boutique management consulting firm, consulting TIOs on their IT infrastructures mainly around the server virtualization and resource management. I was deep into blockchain. I learned about blockchain in the firm, I learned about the theory originally from a friend of mine who works over at ConsenSys.

You first learned about it from a friend of yours but do you have a memory of the specific moment you realized, “This is a big enough deal that I want to go this way?” Do you remember when you first didn’t drink the Kool-Aid but encountered the Kool-Aid and realized, “I might want to drink that, I’m going to go drink that?”

I do remember the moment. After my buddy had told me, I had toyed around with a little bit to dip my toes. I wanted to learn more about what it actually was. I was investing in this, what was I investing in? I read a really good book called Ethereum by Henning Diedrich from IBM. The book goes into detail as far as the intricacies and the complexities of Ethereum in general, how it works, a basic blockchain protocol level. As I’m reading this, I continued to read and digest other blockchain books. Things clicked in my head. I remember reading one of the books in my bed and getting goosebumps as far as this is the infrastructure for the future. I genuinely think that whether it’s blockchain or whether blockchain inspires the new technology, this is going to be the technological advance that shifts us into a new paradigm that’s past the digital age.

Our age is becoming smarter. Everyone's trying to make anything or any digital object, smart such as smart TVs, smartphones. Share on X

You said past the digital age and it will be another different named age of something else, the distributed age.

Distributed age, that’s not bad. The reason is going to have such a big impact is because there’s no easy way to instantaneously transfer currencies. There are methods, most money is all digital at this point. When I deposit a check in the bank, they’re not taking the check and putting it in a nice, neat, little bolt that says, “Brian Smocovich’s money is here.” I deposit the check and they credited my account digitally with the digital value of numbers. We’re already at the point where money is digital. It’s not at the point where we can execute automation and financial decisions using the money or using whatever currency there is.

It’s going to be past the digital age. We now have digital money. We don’t have distributed ledger money. It’s not a part of the distributed age yet and once it is, those transactions and those engagements with currencies are going to be a lot easier in a way. I can’t help but think it comes back to the right interfaces and the right design, which where BlockApps comes in, to solve these problems and bring this to as many verticals as possible, which is super exciting. You talked a little bit and you mentioned an interesting analogy of how many ways that blockchain could end up touching the average person by driving their car. You mentioned the Tesla car because it would include something other than a gas station but can you go through that again? I love that analogy.

From the very beginning, our age is becoming smarter. Everyone’s trying to make anything or any digital object, smart. You have smart TVs, you have smart watches, you have smart side tables, you have smart thermostats, whatever it may be. Everyone’s trying to connect everything. What Blockchain is going to do is going to be able to intertwine essentially automated money transferred along with the internet of things. The example I was mentioning was most Teslas are pretty smart. Imagine your Tesla has a digital wallet on it. You pull into a charging station and then once you pull into a charging station, it automatically reads that your car is there and it can draw the funds based on whatever business logic that you set.

Maybe you want to only spend a maximum of $40 or $50 or whatever it may be and that will pull from your wallet through a smart contract and pay for your electricity. They don’t necessarily have autonomous vehicles. This selected person isn’t using their autonomous vehicle and it causes a car crash. What happens is the car does a self-diagnosis on what’s going on, they crash into you or even you crash into them, whatever it may be. However this scenario goes, you crashing into them may even work better as far as the example but it does a self-diagnosis. It can take that information and send it to your insurance company, which it has on file digitally and immediately, which can then take it, review it, maybe robots are reviewing the claims process. Within an expedited amount of time they pay you out digitally, maybe it could be days, minutes, hours, however, it may be in back into your wallet, you made the whole quickly. There are a lot of kinks in that example, operational inefficiencies that maybe technology hasn’t been able to breeze by yet as far as fraud and whatever it may be but at a high level, that’s what we’re looking at. We’re looking at the automated and instantaneous transfer of funds between the consumer and the enterprise

You talk a bit about automating. When we think about automation, we’re looking at it taking away low-level jobs or more rote jobs. Jobs where people have been taught how to show up, check in, do the thing, don’t ask questions and leave. I feel like those are the most soul-crushing jobs across the board for most people. Some people revel and be like, “It’s just habit. Let’s do it and go home, my life is somewhere else.” If those jobs go away, we’re going to see huge shifts in terms of what we consider meaningful and how we even educate our children to be adaptable to that. You’re talking about automation in a way that’s not discussing, taking away rote jobs but rote transactions or rote analyses.

It’s an analogy that you said. The insurance adjuster loses their job because it’s done by sensors inside the car. It’s done by automation in that sense. It’s so interesting to think of the automation starting at the transaction level and working up as needed rather than this big AI monster is coming to get us and we’re all going to end up in The Matrix. That’s futurism that I don’t buy into but the futurism of we’re going to start with this specific thing, a digital asset and then we’re going to start having digital transactions. From there the digital transactions, the decision trees that go into the transactions get digitized and they get distributed. That seems more plausible. I stay away from the hypothetical futurism of the Doomsday approach where we’re all sitting in a simulation, as Elon Musk once pointed at on stage, “The reality that this is all just a simulation of reality is really high.”

It has a little bit of credence to living in a digital age. I’m not fully sold on it yet but part of me believes that it’s possible. If it is possible, we wouldn’t know about it at this point.

I’m hearing you, it sounds like you’re a bit of a science fiction, maybe a bit of a science kid. Does that resonate with how you grew up or where you went to school? Were you always this imaginative potential science fiction innovator?

I’m big on dreaming and ideas but in high school, I was very much a math and science kid. Calculus and chemistry were always my favorite subjects so it led naturally. I’m a big reader too. I read a lot of a Sci-Fi and fantasy. That bleeds into my expansive imagination.

NTE 11 | Understanding Blockchain

Understanding Blockchain: If you are working from any of the Fortune 500 company and you are not looking into blockchain, you have to get on it because you’re behind.

 

You said you went and studied abroad at one point. Was it in college that you got to study abroad?

I did. I studied abroad in Spain for a semester in Granada, which was incredible. It’s one of my favorite cities in the world.

I’ve been to Barcelona quite a few times but not Granada. It sounds like a great experience but how did you know math and calculus fit into that? What were you studying over there?

I pivoted a bit when I went to college. I decided to double major in management and international business. I had a minor in Spanish studies. Originally, I minored in Japanese for about a year and a half. I’m happy I went back to Spanish. I took Spanish high school and that led me to study abroad. As far as international business goes, I wanted to travel the world a bit. I wanted to be able to work internationally. My previous consulting gig didn’t allow me to do that. Working with BlockApps enables me a lot more to travel. I travel within the country more so often than internationally. I had flown to Australia for the Sibos Banking Conference, which was incredible. It’s also a very fun and beautiful city.

You were there for the Sibos Conference. What were the things that they touched on? Did you feel like there was a lot of conversation that had to do with blockchain when you were there? Did you feel like they were just starting to catch on and it didn’t really have a big focus?

No, there were plenty of blockchain presenters there. I know that we had presented on one of the side stages. There were four floors at the conference. The fourth floor where our booth was the innovation floor or the digital transformation floor. We had some of the big names, ConsenSys was there. We were chatting with Joe Lubin. He did a couple of presentations, I believe. There were a lot of big names, a lot of good blockchain buzz going around, plenty of people from the bottom first floor. A lot of the bankers coming up to see what the hype is about. A lot of people now though with the education, we’re a lot further in the educational curve than we’ve been in the past year or two and it’s exponentially rising. Most business or frontend people tend to know what blockchain is at least at a very high level and how it can help them better the operations of their business. Maybe they don’t fully understand technically or the technical limitations of it but it’s really refreshing. When I first started doing sales at BlockApps, I had one person call me saying, “I have mines in Mexico, how do I mine the Bitcoin?” It was probably my favorite call I’ve ever had because it took me totally off guard.

That’s probably my favorite story about Bitcoin mining that I’ve ever heard.

I tried to sell them on a distributed ledger though.

It wasn’t what he was looking for.

I’ve received significantly less of those calls, which is a great indication that people are better educating themselves in the technology.

2019 is going to be the year for enterprise blockchain. People were saying it was 2018, but it was about initial education. Share on X

That’s exactly why we started this podcast. It was obviously a need and people want to have an easy way to consume this and get more and more use cases, more of an idea of how this affects them as an end consumer but also as an innovator, an entrepreneur. People that are already in the business space are adopting it faster, getting up to speed and learning about it faster. The end user, blockchain’s not going to be used to its fullest capacity until it got crowd adoption and as the internet was not going to work until lots of people were using it. We’re all fighting the good fight, trying to get information out there.

It’s all about awareness at this point. We’re still quite ways off from full public adoption. We’re going to see adoption much heavier within the enterprise space first. 2019 is going to be the year for enterprise Blockchain. People were saying it was 2018 but it wasn’t because 2018 was about initial education. People are starting POCs, 2019 you’re going to see a lot of production applications going in from big Fortune 500 companies. I pretty much said that I believe that every Fortune 500 company either has a production application ready for launch or launched already. They had built a POC or they’re looking into building a POC. If any of the listeners are working for a Fortune 500 company and they’re not looking into that, then get on it because you’re behind.

That is actually the biggest takeaway of this. You’ve heard it straight from the horse’s mouth. One of the biggest dab producers and in the space is BlockApps. You are all over the place as your partnerships with United and Ticketmaster clearly show. This is incredible. It’s been a pleasure to talk with you about this stuff. Is there anything else in terms of where we should go find you? We’ve got a few of your articles, maybe you’ll get around to making some more content if you’re not wining and dining your clients.

My most publicly accessible profiles are my LinkedIn, Twitter and Medium page.

Thank you so much, Brian Smocovich, for taking the time to talk with me here on the New Trust Economy.

Thank you so much for having me, Monika.

Important Links:

About Brian Smocovich

NTE 11 | Understanding Blockchain

Brian is the Outside Sales Executive for BlockApps, a leading private blockchain platform provider for enterprise applications. He joined BlockApps in November 2017 where he advises clients on the benefits of Enterprise Ethereum and walks them through the process of building an application on BlockApps’ STRATO platform. Previously, Brian worked for Wavestone, a boutique management consulting firm advising CIOs of foreign investment banks on their IT Strategies, Infrastructures, and Resources. He first took an interest in blockchain/cryptocurrency in early 2016, quickly falling down the rabbit hole for everything Ethereum related.

 

 

Love the show? Subscribe, rate, review, and share!
Join the New Trust Economy Community today:
Website | + posts