A blockchain-led paradigm shift is underway, says Shone Anstey, executive chairman for Vancouver-based BIG Blockchain Intelligence Group, and whether they like it or not, the traditional banks will need to embrace the new crypto-wave or get trampled in the process.
“You look at bitcoin and you look at the blockchain, it’s really a trust in transaction protocol that’s going to be layered on top of the whole internet,” says Anstey, in conversation with Cantech Letter at the 5th Annual Cantech Investment Conference in Toronto. “If you start to think of it that way, you can start to see how big it’s going to get. It’s technology that won’t be shut down.”
Anstey says that the risk to banks is in inaction, since the bigger tech companies won’t be staying on the sidelines for much longer.
“It’s only a matter of time before Silicon Valley wakes up and discovers that they have the perfect medium to engage in banking,” says Anstey. “They have the war chest to do it, they have mobile devices all around the world and they have the army of developers who would love to take out a 600 year-old industry.”
“In five to ten years, we’re going to have pure-play crypto banks that are built off of blockchain and they will be doing battle against Apple Bank and Google Bank,” he says.
Earlier in January, BIG Blockchain announced it had brought on a new specialist in artificial intelligence to strengthen the cryptocurrency security and monitoring company’s data analytics team. Anstey says engaging with data scientist Dr. Aaron Smith will allow for further innovation at BIG. “I’m very excited to have Aaron on board,” says Anstey. “He’s a veteran in the industry, and it’s helping us enhance our deep learning and algorithms to have greater insight into what we already do.”
As a monitoring company and through its SASS products like BitRank, BIG Blockchain looks for signs of money laundering or connections with illegal activities related to the flow of cryptocurrencies. Its products have already been adopted by such weighty institutions as the United States Homeland Security and Department of Justice. “We’re looking for pattern matching, to see if bitcoin or a different currency is being used on particular dark web websites to buy drugs or guns or for child exploitation, you name it,” says Anstey. “Anyone who wants to engage in cryptocurrency needs to have risk mitigation right out of the gate and we provide that.”
In December, BIG Blockchain completed a $19.5 million bought deal led by GMP Securities, with the company aiming for further growth in 2018. “This year, we’re going to continue to expand our team, to find more ways to get our products out there very aggressively,” Anstey says. “We want to establish our position while the market is raw, we want to show that we are the leaders in the space.”
And while traditional banks are in tough to survive over the next decade, Anstey says the blockchain revolution is actually a positive development for financial systems and their customers, in general, since it’ll produce more clarity and greater trust in our financial institutions.
“Right now, banks are in the pole position,” says Anstey. “They understand banking, they have the staff, they have the customers. But that pole position will erode away, and we will see some that embrace crypto and the new paradigm quickly and they’ll survive and gobble up the rest, while others will falter.”