Singapore-based Lala World uses blockchain to create a connected financial ecosystem for the unbanked, migrant labourers and refugees, i.e, people with limited access to financial services. The company partners with government agencies as well as the private sector providing access to financial services through Lala Wallet and Lala id. Its vision is to reach 100 million people by 2020 and bring financial services to the disadvantaged around the world.

Sankalp Shangari is the CEO of Lala World. An investment banker-turned-social investor, Shangari also runs Block Social, a community of connected blockchain businesses aimed at promoting financial inclusion around the world.

e27 recently caught up with Shangari to know how blockchain is going to revolutionise the world.

Edited excerpts from the interview:

Is blockchain just a hype? In a recent interaction with e27, Stefano Virgilli, a regular speaker at blockchain events, said blockchain is slow, neither secure nor scalable, non-reliable and is already finished. What are your thoughts?

Blockchain is not just hype. However, it is not a magic wand that can solve everything which is wrong with the digital world and the internet. Blockchain’s true potential lies in the way it is implemented and adopted. Putting things in perspective – the internet as we know it is over 40 years old, and yet as a technology, we could consider it as still being in its infancy and yet, we have already achieved so much.

Similarly, there is much to be discovered about blockchain, many of its shortcomings/bugs would be eliminated in the days to come.

There is probably nothing in the world which is 100 per cent secure. However, blockchain is by far the most secure technology to date. Take the example of Bitcoin, the original blockchain and, in my opinion, the only decentralised digital currency. It has never been hacked. There have been other problems, but those are due to manual intervention, which is precisely what the crypto community is trying to solve with decentralisation.

However, I do agree that it is not very scalable considering the vast number of transaction that would get processed in the future.

Suppose I send you one Ethereum, and I make a mistake while copying all the characters. My transaction is recorded on the blockchain, but it doesn’t go anywhere. And funds are lost forever. If this can happen, how secure and reliable is blockchain?

I think we should be responsible for our actions. However, I agree with you that currently there is no room to make mistakes. Hence, we see hybrid models popping up. Taking a step back, if a user sent money with the wrong SWIFT code, it could be a harrowing affair.

Some experts opine blockchain would sound the death knell for banks, while some others believe banks will stay here. What is your opinion?

I want to highlight a basic element of human psychology. Whenever humans have something valuable, they want to entrust it with an entity they can trust and rely on. Also, if something goes wrong, they can complain to this entity who would act on their behalf. Therefore, banks will always stay; they are not going anywhere.

However, like any other business, they will have to evolve. Santander, Goldman Sachs, and DBS are prime examples. You will hear news almost every day about how banks are getting into blockchain (although not crypto).

Many companies and experts are running after blockchain without adequate understanding of the tech. How do you look at the over-eagerness of people to adopt this?

I see that everyone wants to deploy blockchain just for the sake, without considering its impact on the business on ground level. They are putting funds in the development and implementation of blockchain without understanding what kind of benefits they can reap and whether implementing blockchain would be fruitful or not!

Also Read: My best guess is there’ll be no more ICOs one year from now, says Stefano Virgilli

The real issue is the market is flooded with people in it to make a quick buck. This ‘irrational exuberance’ described by Alan Greenspan that plagued the dot-com era will pass, just as how it did in that era, and it will be the business built with a solid strategy and purpose that will come out tops.

What are your views on ICO? Is it sustainable? Is there room for fraud and manipulation? Why majority ICOs fail? Do you think ICO will go away and crypto firms will go back to the traditional means to raise funding?

ICOs are here to stay – in time, maybe in a different shape and form. Already, the model is shifting to Security Token Offerings (STO), ICO PS (Preferred Shares) or others. Investors are becoming more discerning, new rating and analysts reporting will emerge to guide investors, and new crypto bankers will emerge to help filter and guide startups in their ICOs, building up their reputation on their selections and the track record of their buy-sell recommendations. As more institutional funds pour into ICOs, it will also bring in more expertise and governance to this industry.

So while there will always be room for fraud and manipulation in ICOs, it is the same for any other form of fundraising.

Is scamming possible on blockchain as some people claimed? How, according to you, can this be checked?

Blockchain is a tool, how you utilise that tool depends on the user. Since blockchain deploys a consensus mechanism, doing a scam is not possible. Still, a possibility can’t be denied. There are no special checks apart from making sure that people involved in the authentication of transactions are genuine.

Can you point out some industries that can be transformed by blockchain?

Many industries have already been transformed by blockchain. Financial services, particularly insurance, can improve operational efficiency and slash costs significantly, by reducing paper and faster settlements. Other industries are energy, with services like peer-to-peer energy trading; healthcare, where it is already revolutionising how medical records are stored; advertising, to guarantee the validity of clicks between advertisers and web owners; and music, to protect intellectual property.

What is the future of blockchain? Will it be replaced by some other cutting-edge tech in the future?

Blockchain is just a small piece; a means to get to the end. The future is decentralisation and Artificial Intelligence with a close association with IoT devices (Internet-enabled devices).