“We could have the banking industry—which is incomplete in a lot of developing countries—skip some of the steps we went through in the West, and go right to blockchain technology,” said Paul Johnson, a 35-year veteran of the investment community and an adjunct professor at the Gabelli School of Business.

Johnson, a senior advisor with the financial services firm Harbor Peak, spoke to 140 students and alumni of diverse academic and professional backgrounds at the Lincoln Center campus as part of the Fordham at the Forefront lecture series.

In the lecture, titled “Bitcoin, Blockchain, and the Future of Business,” he described the new capabilities brought about by blockchain, a dispersed online system in which transactions are made both more secure and more transparent because information about them is open and stored across the network.

In the developed world, blockchain will take costs and layers out of all sorts of transactions, such as real estate and importing and exporting, Johnson said. Much of its impact will be behind the scenes, he said.

And in the developing world, “it’s quite possible [blockchain]it will become the backbone to a new banking institution,” he said. “Much of its capabilities are yet to be seen.”

He added that it’s too soon to translate blockchain into money-making opportunities, and noted that some aspects of blockchain—such as how to resolve disputes—still need to be ironed out.

“There’s a difference between recognizing its importance and then trying to monetize the trend,” Johnson said.

Bitcoin Risks

Acknowledging the buzz around bitcoin, a digital currency used for blockchain transactions, Johnson advised investors to be cautious, referring to it as a “cultural artifact—a collectible like a Jackson Pollock painting”—rather than a currency.

“It has value because the community has given it value,” he said. “But it’s hard to determine the value of these things that have cultural appeal.”

Johnson offered similar advice about ICOs, or initial coin offerings, which are created through blockchain technology. Like an initial public offering, an ICO is a fundraising tool in which a company sells digital tokens to raise capital rather than issuing shares of ownership. So instead of acquiring equity in a company, purchasing ICOs is like buying a voucher for something that has a finite economic value—“a haircut, a movie ticket, or a ride on a ferris wheel,” for example.

“You can actually buy them, they look like bitcoin and are based on the idea that blockchain is really important,” he said. “That’s where ICOs are in the sweet spot of sucking people in. That causes me concern.”

Johnson attributed the bitcoin rage to “FOMO,” or the fear of missing out, a powerful emotional driver that moves many to make investment decisions without fully understanding what they are buying.

“It’s not some sort of magical currency,” he said, “and if you don’t know what you’re buying, you have the potential to lose a lot of money.”

One attendee, attorney Mike Krieger, LAW ’77, noted that blockchain could cut out the intermediaries in personal and business transactions, bringing “huge cost savings” but also “major declines in certain jobs related to work now done by these intermediaries.”

At the Gabelli School, Johnson teaches courses on digital currency, blockchain technology, and value investing. His students are working on a project called Jesuit Token that will use blockchain technology to promote community service University-wide. The goal, he said, is to incentivize and reward 25 million hours of community service in the next 20 years.

-Claire Curry

But blockchain—the shared-ledger architecture that supports cryptocurrencies like bitcoin—has potential to create “fast, secure, paperless transactions,” he said.

Walker was one of several speakers marking the book release of The Truth Machine: Blockchain and the Future of Everything (St. Martin’s Press, 2018) by Michael J. Casey and Paul Vigna. He and the authors were also joined by blockchain engineer Joseph Lubin, founder of ConsenSys; financial adviser Joshua Brown; and Tyler and Cameron Winklevoss, co-founders of Gemini, a digital asset exchange.

Bitcoin Billionaires

Today, said Cameron Winklevoss, businesses are at the “bottom of the first inning” for cryptocurrencies. He and his brother, Tyler, began investing back in bitcoin in 2012, and he said the two haven’t looked back, in spite of volatility.

As Bitcoin billionaires, the Winklevosses spoke positively of the controversial cryptocurrency.

“Wall Street armies are amassing at the border” to begin investing, Cameron said. “Bitcoin has more lives than a cat; every day it lives on.”

Fertile Destruction and Disruption

Brown said that he was an early naysayer, but has since converted to cautious optimism. He couched his concerns within an historic context: he expects there to be a big bust for cryptocurrencies, but such busts have happened before and they have not always been a bad thing.

When innovative industries go bust, they also can lay groundwork for newer industries that swoop in and reuse the infrastructure. He said the 2008 tech bust left behind the fiber optic networks now used by companies like YouTube.

“If we look back at the dot com era, that was a bubble and a bust,” he said. “Most of the companies died and some survived, but every one of those companies drove learning. And the people who worked there drove a lot of creativity as well as destruction.”

He said the same patterns of boom and bust were happening as far back as a century ago with canal systems and railways.

Don’t Occupy–Build!

Lubin, one of the initial creators of blockchain technology, argued that such financial destruction is what blockchain seeks to avoid. He started working on blockchain after witnessing a “moral and financial bankruptcy” in economic as well as political systems.

“I could see a cascading collapse, and there was no good way to grow our way out,” he said.

Lubin said that, after reading the Satoshi Nakamoto white paper, “Bitcoin: A Peer-to-Peer Electronic Cash System,” he sensed an opportunity and became an expert in the underlying technology.

He saw blockchain as a new trusted infrastructure that makes it feasible for software developers to create a clean separation between the protocol levels and not rely on “protocol priests,” to build every new application.

“It’s a way of distributing control to content creators with far fewer intermediators,” he said. In order to effect change on Wall Street, “let’s not occupy, let’s build.”

“It’s the movement of all our foundational analogue forms—paper, rubber stamps, and subjective interpretation of rules,” he continued. “If all these elements move onto blockchains, then we can see any transaction involving those things cleared and settled over days and weeks [instead of months].”

He noted that corporations are beginning to like the technology, but a lot of work remains to be done.

Casey agreed. “This is not a static technology,” he said.

In addition to ING event was also co-sponsored by the Museum of American Finance, Investopedia and the Gabelli School of Business. 

Blockchain, a newly developed, incorruptible digital ledger system, has the potential to solve this problem, said researchers and experts at a daylong conference on Nov. 10. at Fordham’s Lincoln Center campus.

“We all know that global complex emergencies today are riddled with immense challenges. More people than ever, since World War II, are affected by natural and manmade disasters,” said Brendan Cahill, director of Fordham’s Institute of International Humanitarian Affairs (IIHA).

“Blockchain can have a role not only serving people who are endangered by these crises, in refugee camps or in disaster response, but also in finding new ways that allow for people to be more self-reliant and that ensure the success of long-term humanitarian projects.”

A Technology Resistant to Data Tampering

The conference brought together representatives from intergovernmental and nongovernmental agencies to share the ways they’re taking advantage of the technology, which has made possible the use of the digital currency, bitcoin. Blockchain is a chainlike technology, used for things such as ledgers, that is resistant by design to the modification of the data.

Nick Petford, Ph.D. vice chancellor at Northampton University, detailed how the security afforded by blockchain technology could make possible what he called a “Distributed Learning Ledger.” Such a tool could better capture a person’s nontraditional education experience, including work with families and friends, religious values, and life changing experiences.

Mariana Dahan, CEO of World Identity Network, said that there are two billion people globally who have no proof of who they are, with many living their entire lives with no verifiable ID. In her native Moldova, Dahan said there is hope that blockchain could be used to thwart human trafficking of children.

“If we had an electronic ledger that would record any attempt of getting a minor or an undocumented child out of the country without the consent of the parent, we would be able to secure this information and then act upon it,” she said.

Safe, Swift Transfer of Funds

In the panel, Transparency Dividend: Can Blockchains Stretch the Humanitarian Dollar Further?, Dante Disparte, CEO of Risk Cooperative, said that just as the internet introduced the world to low-friction (easier) communication, blockchain technology has made transferring of funds easier and safer. That could be useful for helping individuals who might need to evacuate an area to escape a powerful hurricane, but who don’t [readily]  have the funds to do so.

“When you introduce blockchain, you can start asking some really interesting ‘What if questions?’ What if we could provide every person who was in an evacuation zone in harm’s way, or in the line of sight of a natural disaster, a $5,000 evacuation dividend?” he said. “Every holder of a homeowner’s policy ought to have that kind of evacuation dividend. With blockchain it’s easy to geo-reference, … to get that third-party validation that we need in the insurance industry.”

Andrew Kruczkiewicz, science adviser at the Red Cross Red Crescent Climate Centre, said blockchain would help the Red Cross be more proactive in predicting where donors’ funds might be better directed. His organization is pursuing “impact-based forecasting” that assesses the potential impact, not just the hazard, of natural disasters. For instance, a storm might affect the entire state of New Jersey, but some areas of the state will inevitably suffer more because of sociological differences.

“If the Red Cross understands that funding is going to be a problem in a particular country or region, perhaps there are donors that are interested in trying to build resilience in that region or that country, or would like to decrease the potential impact of floods,” he said.

“Blockchain can help us to speed things up, make things faster, and add to the transparency side of monitoring and evaluation.”

It’s not here yet, but according to Wences Casares, it’s “inevitable.”

Casares, an entrepreneur and proponent of Bitcoin currency, will join the stellar lineup of cyber security experts for this year’s International Conference on Cyber Security, starting Jan. 5 at Fordham’s Lincoln Center campus.

Casares is the founder and CEO of Xapo, a company that created one of the first storage vaults for a new digital currency known as Bitcoin. The unique feature of this a software-based online payment system (besides the fact that it is exclusive to the digital world) is that it is exchanged peer-to-peer, rather than going through a central repository like a bank.

The exchange does not involve any kind of digital “coin” that is passed around, however. Instead, complex mathematical algorithms log the transaction and transfer the ownership of the Bitcoin from one owner (the spender) to the next (the supplier). The movement of ownership from one person to another is the transaction itself.

As of now, the majority of the six million current Bitcoin users are merely storing it, rather than using it to pay for something. Nevertheless, Casares believes that Bitcoin is destined to become a common payment mechanism.

At ICCS, Casares will explain how Bitcoin storage vaults work, why he believes Bitcoin will soon become a unit of account, and when he predicts Bitcoins will hit one billion users (spoiler alert: very soon).

Sponsored by the Federal Bureau of Investigation and Fordham University, ICCS 2015 is a four-day event featuring more than 60 unique lectures from keynote, distinguished, plenary, and parallel speakers in the disciplines of emerging technologies, operations and enforcement, and real-life experiences. ICCS 2015 presents exceptional opportunities to meet and talk with some of the greatest cybersecurity experts in the world.

Click here to register for ICCS 2015.