While bitcoin in Russia is under threat, blockchain technology attracts the attention of the country's key players. CoinFox has discussed the perspectives of blockchain in Russia and beyond with Marina Guryeva, the deputy director of HSE Innovative Lab.

CoinFox: Let’s start from the very beginning. What did provoke your interest in blockchain, how did you get there?

Marina Guryeva: I studied for my MBA in Singapore, which at that time was already quite friendly towards bitcoin. They had the ATMs installed, and you could pay in bitcoins in cafés. Such things are quite appealing for curious people, you know. Moreover, Singaporean startups and people around them were involved with the digital currency, so I had a chance to visit some events which made me totally fall in love with this entire sphere. It was the very time when my friends got there, too. Having looked into the technology more carefully, I drew a comparison between the present state of economy and blockchain and came to the conclusion that blockchain systems provide an opportunity to optimise many processes while cutting down costs.

CoinFox: According to your expertise and experience, is there any future for the technology in Russia?

Marina Guryeva: Blockchain has inspiring perspectives in Russia. Only last winter nobody talked about it here, and now numerous companies are investigating the technology and thinking, along with regulators, about the ways to implement it. If the outward conditions are as favourable as they are now (e.g., a leading British think tank has released a paper recommending the government to implement blockchain in as many areas as possible), it is quite probable that the technology will get the “green light” here as well.

CoinFox: So is it the government, not business structures, that will be the main driver of blockchain implementation in Russia?

Marina Guryeva: When it comes to Russia, rarely does business risk so much as to start doing things without the favourable attitude of the state. When the state says it goes to ban, to punish, to impose criminal penalties, it is quite natural that nobody wants to get involved with it. Nobody wants to waste his time in prison while there are many other countries which would be eager to have another blockchain company, be it Luxemburg, be it Britain, be it Singapore, not taking into account offshore jurisdictions. Since the globalised world provides numerous opportunities, the Russian-born companies will seek a place where the conditions are most favourable. But as soon as they get the “green light” in Russia, they will build their global outreach companies headquartered at home.

CoinFox: So, you believe that as soon as the state approves of the blockchain technology, banks and companies will all rush to implement it.

Marina Guryeva: Now it is more about institutions other than banks, as serious legal changes are needed to allow banks to move on with blockchain. Of course, many of them will experiment, some of them already do, but for the time being blockchain in Russia is mostly promoted by programmers. We have people here who can create systems based on blockchain; we have people here who already do. They are just working for foreign companies or start their own businesses abroad. As soon as they get supported by the state, they will make sure to legalise here and start working for Russia. That is far from being confined just to finance: blockchain can be used for authentication of goods or personal data, etc. Financial institutions may be eager to finance the startups that work on non-financial applications of blockchain.

CoinFox: Which of non-financial applications of blockchain do you find the most promising?

Marina Guryeva: From the state’s point of view, the most attractive thing is putting registers on blockchain. Property ledgers are so enormous that any time you try to make a deal, you have to bring loads of documents, address lawyers, spending much of your money and time. And still you will not be 100% sure that the deal is “clear”. When it is all transmitted to blockchain, there are special tokens for each kind of property, and the deals are easily tracked. That means that the regulator does not need to conduct the very deal, only to control it. That is a great optimisation.

Our passports are a massive register as well. It is just split into many pieces, as we have to bring information separately to banking institutions, to universities, whatever, since nobody has unified access to any data apart from the paper passport that we bring along with us.

Speaking about industrial perspectives, we come to the Internet of things. It has been spoken about for years now, but, to let it come true, a unified protocol is needed. Moreover, things shall ideally be able to transact between themselves, because the real Internet of things means that my fridge should be able to order meals in accordance with my instructions, and the meals should be brought automatically right to my house… The technology can finally make it real because my fridge can have tokens called money on blockchain. And if I want it to buy stuff only of Russian origin, it will be able to make the right choice thanks to the blockchain-based authentication system. Same goes for transport, logistics, industry… There are numerous spheres that can be all put on blockchain.

CoinFox: To make it all work properly, we have to invest in human resources, we have to train future specialists. Which subjects would you recommend Russian universities to start with?

Marina Guryeva: I think it's reasonable to look at what the US and the UK are doing and just start copying it. There are plenty of blockchain courses launched there, and the amount of scientific research has been growing extraordinarily. Some universities in Russia have also started teaching blockchain. Naturally, you need programmers and developers who understand the way the system works and are able to build it. But if we look broader, starting with, say, finance, we have to understand that a common programmer typically does not understand the current state of the financial system and the ways it could be optimised. So, ideally, blockchain should also be taught to those who work in finance, so that they could collaborate and develop best solutions. Governmental officials and managers should also have the chance to study the technology, as long as we hope to bring all the ledgers on blockchain. It will also be great if lawyers could study blockchain since they need to find ways to get prepared for the future world where the need for lawyers will hardly be that high. They have to think it over: what do we do with jurisprudence when it comes to programmable contracts?

CoinFox: During the interview you paid tribute to Western countries, saying that the development of blockchain in Russia correlates with it flourishing in the West. Still, Eastern countries are by no means lagging behind in terms of blockchain. Why is the Western discourse so important for us?

Marina Guryeva: By saying "West" I often imply everything deriving from the Anglo-Saxon law. Singapore is an outpost of the Anglo-Saxon system in Asia; we could as well name Australia and New Zealand which are also leaders of the blockchain technology in that part of the world. Still, we have China with its mining pools and its fees legally imposed on mining. It supports the development of the blockchain/bitcoin ecosystem because it provides broader opportunities for China's electronic industry. But since it is the finance that the blockchain industry was initially mostly oriented at, we cannot but name the world's leading financial centres: New York, London, Singapore, Hong Kong. When we see the transformation of financial system in the leading countries, we have to choose: either we join them later when we are forced to (as they transform the whole global system, not only their national one), or we do it now when we have a chance to influence the process of transformation, to be part of it. Now we can influence the protocols that will later be adopted globally, we can join the consortium, we can make the decisions — and that is much smarter than grieving later.

Maria Rudina