The cryptocurrency industry is developing with incredible scope, no wonder entrepreneurs are seeking to occupy certain niches to meet demands of the public. At this point, it is important for the industry players to review the current state and discuss pressing challenges to facilitate further development.

On March 9, Tallinn hosted a Blockchain-related conference, which became the largest one ever organized in the Baltic states. Despite the fact that technology and its main derivative, Bitcoin, still seem to be alien to a majority of people, the event has attracted a huge interest, with approximately 250 guests from over 20 countries.

Estonia is the leader in digitization

Event management company Smile-Expo has chosen Tallinn for a Blockchain Conference due to a more than favorable digital environment and the huge support received from the government bodies for organization of technology-oriented projects. Estonia is often viewed as a country leading in certain fields of digitization and business convenience industries.

A number of prominent industry experts, including Jon Matonis, Founding Director at Bitcoin Foundation, Kaspar Korjus, e-Residency Managing Director, Karolina Marzantowicz, Distinguished Engineer at Polish branch of IBM, Kaidi Ruusalepp, Founder of Funderbeam, shared their experience of implementing Blockchain technology solutions in governmental institutions, banking system, trading, media, healthcare and other fields.

They discussed challenges of the new industry, including regulatory issues, trends in public recognition of cryptocurrencies, advantages and limitations of public and private Blockchains, key players in the Blockchain technology industry, and strategies that can be followed by consortiums.

Blockchain revolutionizing Govtech

The potential of Blockchain technology is endless, many speakers discussed its applications that go far beyond the financial services, for instance for patents registration, establishment of private banks and universal European databases.

Managing Director of E-residency, Kaspar Korjus, shared with the audience the operating principles of his own project and application of Blockchain technology in its infrastructure.

Korjus said:

“There is no other place for Blockchain discussions than here in Tallinn. Blockchain itself is nothing, it needs to be considered together with digital identity, legal environment and efficient e-governance. Only then we will start to understand its real impact.”

Kaspar Korjus presented an unprecedented electronic residency project which allowed 18,000 and 1,300 companies from 136 countries becoming Estonian residents.

Public or private?

Jon Matonis, famous Bitcoin-evangelist and founder of Bitcoin Foundation gave a speech regarding Blockchain consortiums reviewing attempts of global corporate finance giants in taming Blockchain technology.

He emphasized that although private Blockchains are beneficial in the short-term, in the long run, they are useless due to their absolute isolation. To exist they would require communication with the outside systems which can be ensured only in the public Blockchains.

Matonis commented:

“Public Blockchains will always have more advantages comparing to private Blockchains, mostly due to their attractiveness for developers. Their nature itself implies more opportunities for innovations.”

A call for partnership

Karolina, Marzantowicz, a representative from Polish branch of IBM said that Blockchain technology will change the digital economy, however, it will require financiers to be more open for cooperation in the field. She added that financial institutions are aware of the advantages of Blockchain technology, however, their presence on the market is not that significant.

Juri Laur, head of the Payment Service of the leading Estonian bank LHV, one of the first in the world to implement Blockchain in their operations commented:

“Banks haven’t implemented Blockchain technology yet for regulation reasons. You shouldn’t use Blockchain in order to just use it. Blockchain without cryptocurrencies is only a half of the battle.”

Don’t try to regulate what initially cannot be regulated

Pavel Kravchenko, founder of Distributed Lab presented his project openbankIT, which deploys Blockchain technology for building an open-source banking platform for e-money management.

The product aims to eliminate technological barriers between financial institutions guaranteeing the highest level of transparency and reliability. Not requiring any specialized equipment openbankIT allows users, banks, merchants and financial institutions customizing the platform to serve their needs.

Kravchenko believes that the success of Bitcoin is mainly related to the fact that it pioneered the world of cryptocurrencies, however today it solves only a limited range of issues, such as for example the speed and the cost of transactions.

He commented:

“The beauty of Bitcoin is in that it allows to avoid regulators. This is actually the biggest contradiction. A tool which allows avoiding regulations cannot be regulated, therefore if you ask me when the adoption of Bitcoin will reach the level of that of traditional money, my reply to you will be - Never.”

True that many governments express a certain level of suspicion and mistrust towards cryptocurrencies, seeing them as a source of problems rather than a solution to existing issues in the financial system.

Executives from the Bank of Estonia and LHV Bank were spotted at the event, what shows that key financial institutions are open up for a change and do not intend to stay away from innovation.

The conference was not all about discussions on a more general level. Representatives from Emercoin, WageCan, OpenLedger, HashCoins, BitcoinChaser, and Cryptopay presented their solutions that already work.

The next round of Blockchain and Bitcoin Conference will take place in Moscow and Prague. Later on, a similar event will be hosted by Kiev.