Blockchain Personality Kris Bennett On the Potential of the Technology, Why A Solid Market Crash Can Actually Be Good, And More

Kris Bennett, aka the Blockchain Beard Guy, is a decentralized architect, blockchain trainer with the Blockchain Training Alliance, industry influencer, advisory board member, speaker, and all-round nice guy. He sits down with us to discuss on why the blockchain industry is about so much more than just the technology driving it, but is in fact the internet revolution reborn.

Who is Kris Bennett?

He’s some bearded guy I keep trying to block on LinkedIn, lol…

I come from a 20-year background in custom software development and consulting. I’ve done it all, from programming to architecture and design, to technical team leadership and engagement management. These days I spend most of my time applying the principles of effective delivery I’ve learned over the years to the world of blockchain. I consult with organizations of all sizes to help them translate their technology dreams into plans that can actually be built.

I am also a teacher and educator, and this is quite selfishly my favorite part! I provide training to organizations and groups of individuals on blockchain so they can get certified as a professional in this space and help be a part of the coming revolution!

And, of course, I do a lot of advocacy and evangelism for blockchain and high tech in general with the #BlockchainBeardGuy stuff. My mission is to make tech easy and approachable for everyone. I truly believe there’s place in high tech for EVERYONE, regardless of personal or professional background, or perceived abilities!

What’s the backstory behind how you got into cryptocurrency and blockchain?

I was always somewhat interested in blockchain and crypto, but spent a long time watching from a distance. When I first learned about Ethereum and the idea of a complete programming language baked into a DLT platform, I got real excited!

I started watching a few YouTube videos on Smart Contract coding, and before I knew what happened, I was 40 hours into lectures by folks like Vitalik Buterin, Vlad Zamfir, and Juan Benet. Then I discovered the awesome blockchain content on Medium.com, and I haven’t looked back since!

I like to think of blockchain as The Matrix – I happily swallowed the red pill, and I haven’t woken up back in my ‘old life’ since. I think a lot of people have a similar experience with this technology and its implications – once you wrap your head around the possibility it tends to re-shape your worldview in some fairly significant ways.

What are your thoughts on the role non-developers play in the blockchain world?

I’m SO excited about all the opportunity for non-tech people in this space, mostly because they have no idea what’s coming, how relevant it’s going to be to them, or how much it will change their lives.

To me, blockchain is playing out just like the arrival of the internet, only on highly compressed timescales. I look at the history of the internet up until now, and one thing is abundantly clear to me. The internet created a LOT of jobs and opportunities for developers and technical people, but it created even MORE opportunity for non-technical people.

Look at how many businesses that have nothing to do with tech depend on models are require the internet, and would not have been possible 20, or even ten years ago! I see blockchain following the same trajectory, it’s going to create 1x tech jobs, but it’s going to create 10x jobs outside of tech!

Irrespective of the industry we’re in, we all keep hearing about how revolutionary blockchain is. What are some of the ways in which blockchain technology can assist existing businesses?

At a high level, I see that there are two kinds of technological progress. There’s innovation, and then there’s improvement. Innovation is something entirely new that nobody has any experience with. Improvement takes something we’re already familiar with and adjusts it slightly. Innovation ALWAYS results in new ways for humans to communicate with other humans. Improvement makes existing ways of communication more frictionless.

Blockchain is an innovation, not an improvement. It has brought and will continue to bring completely new channels and methods for people to communicate with people.

I have this daydream in my head about shopping at the grocery store in ten years. I have this vision of a young mother and her children in the store. One of her children has a severe pesticide allergy, and so this young mother is diligent about making sure she always buys organic produce treated with organic pesticides.

Today, she has to trust that the little organic produce sticker is legitimate. In the future, I see her pulling out her phone and pointing it to a QR code. Her phone reads blockchain data, and she can SEE the whole supply chain. She can see that Tom’s Organic Apples grew the apples and that Sally’s All Natural Pesticides treated them. She can even see that Nadja’s Electric Trucking Company picked up the apples and delivered them to the store. This makes her feel good.

A bit later, she’s a few aisles down and buying dish soap. Because she’s an environmentally conscious consumer, she decides to only buy dish soap that was delivered by Nadja’s Electric Trucking. Your trucking company just became a cross-cutting concern in an end-consumer’s buying decision.

Today, B2B really has no way to create a brand identity or build value in a customer’s mind. Blockchain gives us a great way to actually make this happen – if you’re in the B2B space, it’s time to start thinking about how your brand is viewed by consumers too!

This is just one example of the massive change that this technology has the potential to bring.

For the blockchain-uninitiated, words like “bitcoin” and “cryptocurrency” easily conjures up comments like “Isn’t it used for illegal activities?” or “All that stuff is just a bubble.” How will blockchain shake this reputation?

This is not the answer a lot of people want to hear, but in the short term, I think the best thing to help shake off this reputation is a good, solid market crash.

One of the things giving us a black eye right now are all the day traders and short-term profit seekers. The internet before the crash in 2001 didn’t produce much that’s still valuable today. Sure, there are the Amazons and eBays, but these are the exceptions, not the rules.

Most of the start-ups from back then ended up like Webvan and Pets.com. Once the market crashed the only ones left were the ones who really BELIEVED in the internet for something beyond short-term gain. Those are the people who went on to create the internet of today.

Long-term, we just need a little time for new things to become normalized. Look how much stuff is “normal” in life today that was considered “weird” only ten years ago. Online dating is the default operating mode for single people today; it’s considered totally normal. Ten years ago online dating was for “losers“ who couldn’t meet people in real life.

When I was growing up one of the lessons that got pounded into my head was “don’t get in a car with a stranger.” Hitchhiking was considered certain death! Now we live in a world where we don’t call a cab, we call an Uber. A total stranger comes and picks us up, and we get in the car with them without thinking twice about it.

When the internet started, it too was considered to be a place where undesirable or unprofessional types hung out – time normalized all that. It will be the same with blockchain.

Due to regulatory concerns the world over, and brazen scams running rife, the ICO model is on shaky ground. How do you see the current model changing in the near future?

It’s not going away, but it IS going to have to evolve significantly. You just can’t have a sustainable model where business leaders aren’t accountable to their investors in some form or another.

The popularity of ICOs isn’t because ICOs are a great idea, but it’s capturing pent-up demand from the long tail of small investors who don’t have the resources, connections, or clout to get into the IPO market. If we separate the two concerns and create a way for micro-investors to play just as big a part in the world as the Warren Buffetts, then there’s not much left for the ICO model to stand on.

My biggest beef with ICOs right now (besides the occasional theft and dishonesty) is the number of GREAT blockchain architectures I see ruined because the team feels like every blockchain project HAS to have a coin or token. It’s just not true, and it’s ruining a LOT of great blockchain ideas. Inserting a token into a solution just so you can get funding is stupid.

Here’s a way to fund a project that I haven’t seen anybody adopt yet, but I’m 1,000% convinced would be adequate to fund POC [Proof of Concept] development.

Step 1 – Understand that your story is only boring to you. Starting your project or company in blockchain is an exciting story that a lot of people would like to watch.

Step 2 – Take your phone out of your pocket, put it selfie mode, and record a 2 to 10 minute video every day talking about what you’re doing on your project today, how it’s coming along, what meetings you’re having, etc.

Step 3 – Setup a Kickstarter, Indiegogo, GoFundMe, etc.

Step 4 – Post your videos on YouTube, include a link to the crowdfunding page.

If someone can do this, and tell an interesting and compelling story, I think they’d have no problem raising the $10-$50k it takes most startups to get a POC together. Let’s see if we can inspire anyone with this article!

Most blockchain investors are not technical, and due to blockchain’s meteoric rise in popularity, many don’t have any previous experience in investments. What’s your advice to potential and current investors on how to ensure a project is solid?

First of all, there’s no such thing as easy money. If you want to invest, you’ve GOT to do some homework first! I like to label blockchain as the world’s greatest get-rich-slow scheme.

These are the things I measure a project on, in order of importance:

1. The Team – Far and away the most critical aspect. We’ve all heard of Uber, very few of us have ever heard of Magic Cab. Magic Cab was first to market with a ridesharing app, but they couldn’t execute like Uber – they didn’t have a solid team. I look for a diverse team in terms of skills AND backgrounds, and I make sure they have a solid methodology for delivering.

If you’ve ten brilliant developers and not a single marketing and branding resource, that’s a huge red flag. If you’ve got a dozen “advisors” and each of them is on seven other projects, I wonder how much good advice you’re really getting. Is the team committed? Would they feel like they couldn’t breathe if they were doing anything else, or is this just a fun thing to do after work?

2. The Market – 85% of new startups fail because they’re offering a product nobody really wants. Does this product/service/app either:

Solve a new problem and enable something that could not be done before?

Solve an existing problem in a way which presents less friction to an end user/consumer?

It’s amazing to me how many projects take a process from real life, make it more difficult, then talk about what a world-changing solution they’ve got. Great made-up example – I can already pay my phone bill directly with fiat, so the idea of exchanging fiat for Ether so I can exchange Ether for your ERC-20 PhoneCoin and use that to pay my phone bill is never going to take off, especially if the phone company has to unwind all that at the other end.

What you’re building has to make something that already exists easier, or provide something new altogether.

3. The Idea – The thing everyone wants to protect is actually the least valuable thing, IMO. Is the idea solid? Is it realistic? Will it scale? And most importantly, what’s the plan if the idea is really GOOD and everyone wants to buy some? What does the future of your idea hold – are you playing a finite game or an infinite one? Is your idea part of a larger vision for your company, your brand and your legacy?

Which technical concepts are crucial to understand if you’re going to invest in blockchain, or become involved in the space in any way?

One concept I try to drive home a lot is the idea of “announcements.” The concept works a bit like a Russian doll.

The outermost layer is the one most people understand. This is the bitcoin/cryptocurrency model. In this model, two or more parties enter into a transaction in which monetary value is exchanged. I might agree to buy your used car for $1,000. I could pay you in crypto, and this transaction is recorded on the blockchain.

To get to the second layer, let’s peel away the idea of exchanging something of monetary value. Let’s say we have two or more parties who enter into a transaction, but nothing of value changes hands. This could be you and your doctor adding a new prescription to your blockchain medical record. All the benefits of blockchain still apply in a scenario like this, but no value is being exchanged.

Lastly, peel away the idea of two or more parties being involved and you get to a single entity standing up and making important announcements. This is like the supply chain example, where each participant ‘announces’ the important activities as they happen for later review and audit.

I think once you get your head around the idea that capturing any important announcement is a key use case for blockchain, it really helps to show the amazing possibilities outside currency.

What is something about blockchain most people don’t know, but should?

Blockchain is big. Like really big. Like way, way, way bigger than anyone is thinking… Want an example?

Did you see the SpaceX Falcon Heavy launch? Humans are back in space, and in ten years we’re going to be living on Mars. It sounds insane today, but we are ten years out from being a multi-planetary society.

When that happens, humans will add AN ENTIRE SECOND PLANET to our economy! Earth-based centralized systems of trust and control just AREN’T going to scale when the round trip distance is 26 minutes at light speed. Decentralization is paramount, and blockchain is the economic fabric that will make multi-planetary commerce a reality.

You’re a blockchain trainer. Help! Proof-of-Work, Proof-of-Stake… It’s all Greek to us!

Don’t feel bad, this is one that seems confusing to a lot of people at first, but it isn’t too complicated in theory.

Proof-of-Work and Proof-of-Stake are two different types of group consensus mechanisms. The idea of group consensus is simple – once a certain number of transactions have been performed, the group of nodes or miners on the network will all seek to verify they have the same information, and if so they’ll add that “block” of transactions to the “chain” linking all the blocks together.

To understand what Proof-of-Stake (PoS) is, you must first understand the model we have in place today, called Proof-of-Work (PoW).

On any blockchain, the various transactions and announcements are recorded by computers on the network called ‘nodes’ or ‘miners’. Once a certain number of transactions have taken place the miners stop to make sure everyone has the same record of transactions. This is done by assigning a very hard math problem to all the miners.

The first one who comes up with the answer gets rewarded IF, and only if, the majority of the other miners agree with that miner’s list of transactions. If the winning miner is trying to cheat, the rest of the network will disagree and start over. The cheating miner just invested a lot of time and effort (i.e. money) and got no reward.

This is how we do things today, and as blockchains have exploded in popularity this model has lead to two big concerns:

1 . Scalability

Proof-of-Work worked great in the early days, but as blockchain tech has exploded it’s shown its limits. The Ethereum network is currently processing 10–15 transactions a second, which is not enough to support full-scale global applications and commerce.

2. Centralization

A core tenet of all distributed ledger technologies is decentralization. As PoW blockchains grow, the math problems the nodes have to solve become harder and harder. Personal computers and devices no longer have enough power to contribute to mining efforts in a meaningful way, and the bulk of today’s mining takes place in a handful of massive data centers. This stands in stark contrast to the guiding principle of blockchain — decentralization.

The incentive towards honesty that Proof-of-Work provides is simple — “if you’re honest you get rewarded, if you cheat you lose money.

Proof-of-Stake aims to provide the same incentive in a less computationally expensive way. In Proof-of-Stake, every time a block of transactions needs to be validated the “miners” (now called “validators”) are all required to place a large sum of money (a stake) on the table. If your transactions match the transactions of the majority of the group, you all split a reward. If your transactions do not match, you lose your stake.

Imagine a new casino card game called “Honesty.” The rules of the game are simple. First, you have to stake or deposit $25,000 of chips to sit at the table. If you’re honest, you will win $25 every hand, no matter what. If you cheat, you lose your $25,000 stake. If you’ve been honest and you’re done playing you take your stake and winnings and go on your way.

This game is essentially Proof-of-Stake. It provides the same economic incentive towards honesty that Proof-of-Work does, but without requiring massive computational resources to do so.

This means that provided they have the stake, anyone can be a validator. You can validate transactions on the blockchain from your living room laptop, and make money doing it too. The rewards of validation no longer go to those who spend the most on hardware and infrastructure, but to those who care enough about the integrity of the data to place quite a large bet.

Personally, which are some of the blockchain applications and projects that make you go “Woah! This is why I’m in this industry!”?

I’ll be honest; I’m a people person who just happens to work in emerging technology. So in my view, some of the most interesting things I see are on the people side. I’ve found that blockchain and the people in it have some really interesting macro-level traits.

Blockchain people tend to:

Be happy, positive, and friendly.

Be willing to help and engage with others in a productive (and non-condescending way).

Have a mild-to-severe level of frustration with the institutions and societal pillars that are failing us.

Have a real drive and determination to go re-make broken parts of the world in a better fashion.

Are open-minded and welcoming of others.

Aren’t hung on up title, position, or wealth. This is a group of people who understand happiness and personal fulfilment at work are the paychecks and corner offices everyone will aspire to in the 21st century.

Actually go do stuff instead of talking about stuff.

What I really love is the way blockchain allows us to outgrow a lot of the problems we’re currently facing. The issue of diversity in STEM in one such example. I love this idea that we don’t have to fix the elitist and exclusionary culture of Silicon Valley or Wall St because we all know we’re starting something that’s going to be bigger than all of that and we’re just going to outgrow the problem.

We’re going to create a better world from the beginning so when it takes yours over, we win! Want to be closed-minded? That’s cool, enjoy living in the last millennium. The rest of us are going to be out there building the future…

Lastly, I just have to ask. What’s in the beard oil you use that makes you get all this stuff?

Lol, it’s nothing but tons and tons of passion! I was a teenager when the internet first came along, so I got to watch the internet grow and I knew the whole time the world would NEVER be the same. I always thought it was amazing I got to live to see a once-in-a-lifetime event like that, but I was always a little sad that when it happened, I was still in school, had no experience, and didn’t how to get on the board and play.

Blockchain is amazing to me because I’m now witnessing the second once-in-a-lifetime thing in 25 years, and this time I’m on the board, and I get to play.

It’s just a very fun place to be in, and I love the people I meet and where it’s going. To be honest, it just doesn’t feel like work at all to learn all this stuff and help pass it on to others! 🙂

Related: 24 Industries That Blockchain Will Radically Transform