An Explosion of Opportunities in Blockchain
We’re back with our next instalment in the ‘Where are they now?’ series, where we take a look back on the shortlisters from 2020’s Rising Women in Crypto Power List and what they’ve been up to in the last year. Don’t forget, nominations for this year’s campaign are currently open until 29th October! Nominate yourself or somebody else here.
Today, Christina Lomazzo gives us some insight on what the future of blockchain might look like, and how it can help benefit people all over the world.
An Explosion of Opportunities in Blockchain
Studies show that 65 per cent of children starting primary school today will eventually work in jobs that don't currently exist.
The blockchain and cryptocurrency space is one that was unimaginable for adults and children just a decade ago. Since the Satoshi whitepaper was released in 2008, the industry has evolved at an exponential pace. As a result, we are seeing unparalleled potential to leverage the technology to support communities that are traditionally excluded from systems, such as digital services, education and skill-building, and health and financial services. Just as children explore and develop skills for future careers that may not exist yet, institutions like UNICEF (LINK) need to build organisational knowledge to adapt to new contexts and continue delivering on our mission.
Who are the UNICEF’s Ventures Team?
UNICEF's Ventures Team looks at the next three-to-five-year horizon and explores emerging technologies that may have a positive impact on the delivery of humanitarian and development programmes. Within this team sits the UNICEF Innovation Fund, which began exploring the potential of blockchain in 2015 with its first-ever prototype: capturing, encoding, encrypting, and validating photos of our team members as immutable identification on the Bitcoin blockchain. While it gave us our first hands-on experience with the Bitcoin blockchain, it also reminded us that we need to build with users and their context in mind, like with any technology. Thus, we refined our approach to blockchain and cryptocurrency over the following years, combining cryptography, financial economics, and network engineering to disrupt power dynamics and create opportunities to redesign systems fundamentally.
Investing in Blockchain
Realising the ever more digital world we live in, the Ventures Team made its first significant investment into blockchain startups in 2018, supporting various use cases, including vaccine supply chain tracking, digital certificates, and remote connectivity. The goal was to support these projects to scale while at the same time giving UNICEF a better understanding of the potential of blockchain technology. This cohort taught us that blockchain works well as a ledger to share information across multiple parties. It can also be used as an efficient way to transfer value between parties. And smart contracts presented an opportunity to create efficiencies in traditional systems.
What is UNICEF’s CryptoFund?
The Ventures Team also believed that digital currencies could introduce some benefits to the processes and systems at UNICEF. So, in October 2019, UNICEF launched the CryptoFund, a crypto-denominated venture fund and the first use of cryptocurrency (without converting) within the UN. All crypto transfers, such as donations to UNICEF and investments to startups, etc., are visible to the public and traceable through the UNICEF CryptoFund website.
To date, the CryptoFund has made 18 investments in startups across 10 countries. The initial results from the CryptoFund are promising – value is transferred to startups on average in under 10 minutes, with overall transaction costs being under 0.1 per cent.
UNICEF Impact During the Pandemic
During the COVID-19 global pandemic, UNICEF deployed crypto capital to startups adapting their solutions for the new realities their countries were facing.UNICEF's crypto support went beyond the blockchain space. For example, the CryptoFund supported Afinidata, a startup based in Guatemala, developing an AI-based app to provide parents with personalised early childhood educational activities. Another example is Cireha, an Argentina based startup that has created Cboard, an open-source web application for children and adults with speech and language impairments, aiding communication with symbols and text-to-speech. In our most recent call for applications, nearly 75 per cent of startups applying for funding indicated an interest in receiving their funding in cryptocurrency.
Some of the UNICEF Innovation Fund and the CryptoFund's most recent investments included 8 startups working on pathways to financial inclusion. The investments ranged from a platform looking to increase financial literacy through gamification (Xcapit), to a virtual bank for refugees and vulnerable populations (Leaf Global Fintech), and ways to include communities in inclusive and decentralised decision making (Somish Blockchain Labs).
UNICEF's approach to blockchain has become more focused, looking at solutions that solve cross-cutting challenges like creating credible and coordinating information systems, representing individuals more fairly and equally in systems, and building products for users with different needs.
As the blockchain and crypto ecosystems continue to evolve, we will continue to see applications emerge with an opportunity to reshape the structures of traditional systems. As UNICEF continues to experiment and invest in new technologies, we are committed to achieving a gender-balanced portfolio and have called on other venture capital firms to make the same pledge. Supporting a diverse group of founders to build blockchain and crypto products inclusively and openly is incredibly important. UNICEF is committed to working with the crypto community to ensure we create a digital future for every child and every young person to survive and thrive.
Christina Lomazzo is the Innovation Fund Lead within UNICEF’s Office of Innovation. She oversees the team that makes early-stage investments into startups building open-source solutions with emerging technology. She is also responsible for the operations of the UNICEF CryptoFund, the first use of cryptocurrency within the UN. Prior to UNICEF, Christina worked with public sector organisations to pilot blockchain and she has taught at several universities on the topic.