US-China Investment News Interview Series: Navroop Sahdev on bitcoin, blockchain and token sales


US-China Investment News Series #2

Economist Navroop Sahdev on bitcoin, blockchain and token sales.

“What is truly revolutionary about the ‘token economy’ is that it is leading us to rethink how we perceive and measure ‘value’ in our economic system(s) and I think this is the question that should be front and center in all ICO debates” says Navroop Sahdev, who is leading the research efforts on the implications of distributed ledger technologies and token sales on economic science. She has been looking closely at the crowdfunding market since the JOBS Act and has co-authored Hyperledger’s “Blockchain for Business” MOOC.

Navroop Sahdev is a research associate at the Centre for Blockchain Technologies at University College London and a 2017 UN Youth Delegate.

1) Tell our readers about yourself, how did you get interested in the fintech space and in particular, blockchain. Was there some catalyst event that sparked your interest or your background in economics fueled it?

I am an economist by training. In early 2016, as I was winding up my thesis work at Harvard Kennedy, I was researching the current inefficiencies in the US financial services sector, and stumbled upon blockchain as a new infrastructure-technology. Given my background in networks theory, complex systems science and Commons, blockchain technologies had immediate appeal to me. Ever since, my fascination for distributed ledger technologies (of which blockchain technologies are a subset) has only increased. The more use cases I look at, the more potential I see of distributed ledger technologies to transform businesses and entire industries. In fact, this transformation is already underway.

2) There is a lot of talk about bitcoin and somewhere less about blockchain for the general public. If you had to explain why these new technologies are so important, how would you tell someone who has no background in them? Is it really as transformative as the internet?

Indeed, the price of Bitcoin (and equally so of other cryptocurrencies) is getting most of the public attention, thanks in part due to CFTC’s approval to allow Bitcoin futures trading at CME and CBOE. With that, Bitcoin has joined mainstream financial markets leading the general public to look at cryptocurrencies as a viable investable asset, for the first time.

At the most basic level, blockchain is an append-only database where you can add data but cannot alter or delete it, hence making it an immutable record of events (or transactions). The transactions that take place on a blockchain are completely peer to peer with no intermediary, while all data is cryptographically secured. Blockchain technology is, in fact, a collection of technologies that previously existed. What’s innovative about the Bitcoin blockchain (which is the first blockchain) is how it ties these technologies together with a new ‘consensus’ protocol to build a decentralized global network.

While blockchain technology (along with a host of other technologies like AR/VR, AI, Big Data, Machine Learning, etc.) certainly has the potential to usher in a new digital era, whether or not the efficiencies to be gained by deploying blockchain technology end up being as transformative as the internet would depend on a host of factors. Lot of it depends on the legal frameworks the technologies operate in. Are we ready for a truly decentralized internet? Turns out, the answer is not as straightforward. Governments, for example, maybe not be ready to give up their privileged access to information on the internet.

Navroop Sahdev on Rethinking Economic Structures with Blockchain Technology

3) There are more and more applications and companies trying to utilize blockchain, particularly large banks have started taking it more seriously. What do you know about this, any interesting happenings?

I’d say a lot is happening in the space. There are use cases encompassing all industries and in many instances, criss-crossing them, hence joining new dots. Some industries are looking at blockchain technologies more aggressively (like finance), while others are following suit, but at a relatively slower pace. The relative complexity of a use case is another factor that’s holding back certain industries.

In terms of the overall trends, I think we are witnessing an unprecedented level of collaboration in the space. Companies that are, in fact, competitors are actively forming industry consortiums. Examples would be R3 CEV for large banks; Hyperledger and the Enterprise Ethereum Alliance for industry players. Obviously, the reasons are economic i.e. cost sharing. Since blockchain is a new infrastructure technology, the cost of moving to a new infrastructure is way too large for one company or entity to bear all by itself. Indeed, the only way blockchain can become the future is if all players (at least all big players) in the space join forces to develop the technology along with industry standards.

4) Do you think cryptocurrencies are here to stay, and how far can bitcoin go? Lot of people talk about the 21M limited supply to drive prices even higher, but what if regulators really step in? After all, the whole point of crypto based assets and blockchain is a decentralized global distributed ledger. Can it be regulated?

I definitely think that cryptocurrencies (which is one of the use cases of blockchain technology) are here to stay. The thing about crypto assets is that ‘value’ lies in what the community considers valuable. So while the current phenomena probably has all characteristics of a bubble, there are no ‘fundamentals’ to return to, as in traditional assets. There is no such thing as “market cap” of cryptocurrencies (totally misleading term!), so there is no reason to believe the price will go up or down (either direction). What we know is that the frenzy is being caused by excess demand and the mainstreaming of bitcoin.

Technically speaking, no national government can take down a global decentralized network. What the regulators can do, however, is to step up the compliance burden and increase taxation (indirectly making it a less attractive asset). One way this may manifest is by bringing cryptocurrencies under existing legislation, for example, money laundering. Here, the important thing to remember is that law is technology-agnostic. Regulators don’t regulate the technology, they regulate an economic actor’s functionality in the market. So for example, if you are a trader-broker, the law doesn’t care about whether or not you use blockchain technology, you need to be compliant with all laws that regulate the service you provide to the market, that of a trader/broker.

Here’s the catch though, the more regulation we see in the space, the more legitimacy it lends to crypto assets. Investors who dismissed bitcoin and other cryptocurrencies just a year ago, are now asking ‘is it too late to invest?’ The very fact that regulators are seriously looking at cryptocurrencies, is an indicator of their mainstreaming and hence, louder the message, that cryptocurrencies are here to stay.

Disclaimer: All opinions are those of the interviewee alone and do not necessarily represent the opinions of the institutions mentioned in the article.

To submit your interview, press release request, contact us at