Blockchain banking could open new avenues for employment in the Cowboy State, but people should start learning about it as soon as possible, according to self-taught blockchain guru Caitlin Long.
“Blockchain isn’t rocket science, though certain aspects of it are being worked on by rocket scientists,” said Long, who recently announced she was founding a blockchain bank in Cheyenne. “The vast majority of users can be self-taught. There’s so much on the Internet (about blockchain). If you take the time, you can learn it.”
A Wyoming native, Wall Street veteran and Wyoming Blockchain Task Force gubernatorial appointee, Long said she taught herself the ins and outs of blockchain.
“It doesn’t require a degree to learn this technology,” she added. “Just get your feet wet and start learning.”
Blockchain is a digital ledger system stored across a variety of online networks and the underlying technology enables the use of cryptocurrencies such as Bitcoin.
As the rest of the nation grapples with the rise of blockchain technologies in agriculture, banking and dozens of other industries, Wyoming was first to the front by passing legislation facilitating the creation of Special Purpose Depository Institutions (SPDI) (https://cowboystatedaily.com/2019/12/02/wyoming-opens-avenues-for-cryptobanking/), or “speedy banks” specializing in cryptocurrency transactions, in 2019.
Taking advantage of the SPDI regulations, Long said her newest business venture, a digital asset financial institution dubbed Avanti, could open as soon as 2021.
“I will give (employment) preference to people in Wyoming,” she said. “The beauty of blockchain is we can hire people who live in Wyoming’s rural areas. As long as they have an internet connection, they can work as customer service representatives and compliance officers.”
Long said her company intends to file an SPDI application with the Wyoming Division of Banking soon.
Wyoming Banking Division General Counsel Chris Land confirmed the agency is currently reviewing two other SPDI applications.
In regards to digital asset education, the University of Wyoming is poised to take advantage of the state’s lead in the blockchain world, said Jim Caldwell, UW Computer Science Department head.
“This is a huge opportunity for the state to diversify the economy,” Caldwell said. “Everyone knows about Wyoming and blockchain. There’s international attention on the state focusing on these efforts.”
With the help of a state funding match, IOHK, a financial technology company, is in the process of backing a blockchain research and development lab at UW, Caldwell said.
“We’re going to be working on some cutting-edge blockchain research at UW,” he added.
While the Computer Sciences Department currently offers a class about the engineering side of building out blockchain, Caldwell said UW’s College of Business offers a class about blockchain in financial technology.
“The applications for blockchain are really broad and being used by nearly every discipline,” he said. “It has the potential to affect every discipline on campus in some way.”
Avanti and other SPDI banks could help Wyoming jump into the global digital asset market, but Long said America has some catching up to do.
“The U.S. is absolutely behind the curve on digital assets in general,” she explained. “In Switzerland, not only can banks offer custody services and trust services, but they can accept deposits in the form of digital assets. That goes quite a bit further than even the Wyoming SPDI bank charter does.”
Hong Kong, Singapore and Japan are hubs for the digital asset industry, which is valued at about $300 billion annually, Long said.
“The U.S. is only about 20 percent of that value,” she added. “We have this logjam in our financial services regulations.”
By Wyoming statute, SPDI banks differ from traditional financial institutions.
“SPDI banks cannot take risks with customers’ assets,” Long said. “The law requires the banks be 100 percent reserved, so the banks cannot lend or take interest rate risk. They are akin to the money warehouses of the 1800s.”
Because all the transactions are digital, Avanti will not have a typical brick-and-mortar branch with tellers and other amenities people might associate with traditional banking. As required by law, however, it will have a physical location in Cheyenne, Long explained.
“One of the services Avanti will provide is the ability to change digital currency into dollars,” she said. “Primarily, we will provide custody services for private keys that control digital assets.”
