If you haven't already done so, go ahead and read our previous piece on Central Asia here
When it comes to technological advances, Central Asian countries often find themselves playing catchup. But not so when you are talking blockchain. Indeed, if you are looking for high-potential blockchain adoption case studies, the Commonwealth of Independent States (CIS) region has them by the dozen.
In many instances, these are being driven by some of the most influential people in the region – high-ranking government officials and leading business executives, not to mention scores of overseas investors.
As many of the schemes are nascent, their fruits are still maturing, and only time will tell how lucrative they can really become. But as 2018 approaches, the New Year could well see Central Asia move out of the tech shadows – and into the fore of the great global blockchain conversation.
Georgia… on everyone’s mind
Central Asian blockchain adoption is intensifying fast in Georgia, where California-based blockchain technology provider Bitfury has developed a particularly strong bond with the Tblisi government.
Bitfury developed localized land title registration software and ran a successful piloted scheme before signing an MOU with the country’s National Agency of Public Registry (NAPR). Under the terms of the agreement, Georgia’s government now uses Bitfury’s software to log land title purchases and sales and register new titles. Distributed ledgers like blockchain could also be used to manage demolition notices, mortgages and rentals.
The NAPR chairman told reporters that his agency had wanted to digitize for some time and saw an opportunity arising with blockchain. He claims, “We thought blockchain technology would be a secure, transparent and accessible option.”
So successful has the project been that even non-Central Asian CIS states want a piece of the action. In April this year, Ukrainian officials signed a partnership deal with Bitfury that the company’s CEO Valery Vavilov described as “probably the largest of its kind anywhere.”
Georgia’s land-titling project is a world’s first. Within just a few months of its launch, Vavilov claimed some 100,000 documents had been processed on the blockchain-powered platform. The project and has even caught the interest of experts at the Harvard Business School.
Inside the “Singapore of blockchain”
Not wishing to be outdone by its neighbor, Kazakhstan, Central Asia’s biggest economy, is also making moves. Not content with being the biggest fish in the region’s digital currency pond, the country is also hoping to become one of the world’s most significant blockchain players.
Astana this year penned a deal with Deloitte and blockchain platform Waves. The trio plans to introduce the technology into a range of government operations. Waves’ CEO Sasha Ivanov enthuses, “Thanks to its forward-thinking approach, Kazakhstan is becoming something like the Singapore of blockchain.”
The Waves chief claims that Kazakhstan has already gone beyond “active interest in the technology,” moving on to the implementation of “some real applications for banking and public services.”
Things have been progressing at a rate of knots at the country’s gleaming new, state-backed Astana International Financial Center, Kazakhstan’s fintech hub. Last month, the government announced a deal with Fiat that could see it launch the region’s first national digital currency platform, Stasis. It also sealed an MOU with a Maltese tech investor that will see it further its “Digital Kazakhstan” initiative.
And the country’s national bank this year also announced it is working on a blockchain-powered mobile app that will let its citizens trade securities. So keen is the Astana government on its Digital Kazakhstan initiative that it has begun showcasing it around the world – the deputy prime minister Askar Zhumagaliyev personally took charge of talking up Kazakhstan’s blockchain potential at the Web Summit 2017 in Lisbon earlier this month.
Elsewhere in Central Asia, progress is also being made, although perhaps not quite with the same alacrity as Georgia or Kazakhstan. In Armenia, for example, the number of blockchain-related Google searches has doubled in the past year or so, and a leading Yerevan-based consultancy claims blockchain technology could be a major money-spinner for the country. But besides a few ambitious blockchain startups founding R&D hubs, the technology has not yet really made it onto the national agenda.
In Tajikistan, APAC-region crypto-financial services provider Bitspark has launched a blockchain pilot in conjunction with the United Nations Development Program that could one day allow citizens to trade self-generated solar energy using decentralized ledgers.
And in Azerbaijan, the country’s Ministry of Education recently hosted a workshop for local startups keen to move into blockchain technology.
Although Georgia and Kazakhstan remain the prime blockchain players in the southern CIS region, others are starting to follow suit – although, crucially, governments have remained guarded in their enthusiasm for blockchain technology.
But signs are this could change soon. Kyrgyzstan’s government this year revealed it is hoping to create its own “data center” for blockchain startups, possibly in the mold of Kazakhstan’s Astana International Financial Center. It remains to be seen if anything significant comes of this, but the fact that the country’s Economy Ministry has given the project its blessing is already promising. The move is yet more significant when you put it in a little context: This tiny country made world headlines when it unveiled Central Asia’s first ever bitcoin ATM back as 2015, beating even its gigantic, digital currency-mad neighbor Kazakhstan to the punch.
The blockchain knock-on potential is tremendous. Should Georgia and Kazakhstan’s ventures bear as much fruit as their governments hope, the rest of the region will rush to get on board – or risk being left behind by the speed of progress. And if blockchain pioneers in elsewhere in the region can win the support of the political elite, Central Asia could well find itself ready to take the fintech world by storm.
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Writer for the BBC, The Guardian, The Jewish Chronicle, Korean Air’s MorningCalm, Chosun Ilbo, Weekly Chosun, Kyunghyang Shinmun, Essen, The Korea Times, Joongang Ilbo, Korea IT Times and many others.