Insights

On the 28th of September, Dr Max Ganado addressed guests during the event organised for the first blockchain product to be launched by the private sector in Malta. The developers of Application LP01 are a Maltese Company called Ledger Projects Limited.

David Schranz, one of the directors of the company, introduced the software development company and its vision. He was followed by Hon Silvio Schembri, the Parliamentary Secretary in the Office of the Prime Minister of Malta, responsible for Financial Services, Digital Economy and Innovation who noted the launch the week before of the first Government developed blockchain application in the field of education certification and welcomed this first launch by a private sector participant in this sector.

Dr Abdalla Kablan B.Sc IT (Systems Engineering), MSc (Financial Engineering and Knowledge Management), PhD (Computational Intelligence in Finance), who is also a lecturer at the University of Malta (Faculty of Economics, Management and Accountancy) then took the stage. Dr Kablan, the company’s science and technology mentor, first provided a general overview to the technological progress being registered in the area. He then proceeded to introduce the application. LP01 refers specifically to agreements relating to land and buildings and notarial practices which will help reduce risk for all due to the features of the blockchain technology.

Dr Ganado then followed with comments on what the previous speakers said, starting with the remark “that things are moving so fast in this area I am actually feeling I’m growing older more slowly!” The focus of Dr Ganado’s contribution was on three points: property, people and money, apart from expressing support for the strategic approach being pursued by the Government of Malta on this subject. All aspects are highly debated in blockchain discussions.

Property was once owned by whoever had possession and, although laws on ownership were developed to high levels of sophistication, it took centuries until public registry systems were introduced. The introduction of a public register of land was a ground breaking technology at the time, which had massive economic effects as it created legal certainty on titles and transactions. First we had registers based on people and, more recently, we developed registers based on land. Now we have the potential of blockchain which can provide integrated solutions including information on parties, documents, smart contracts for transactions and payments. Ledger Projects are the first to take up the challenge and to bring the positives of the blockchain to Malta’s notaries and their clients.

People need trust to deal with each other but, in today’s world, we have a problem with trust. In Sharia law, a contract was only valid if you could look into the eyes of the other contracting party! Blockchain assumes lack of trust between people, caters for transactions among persons who are not able to verify each other’s identity and provides potential for transactions which are secure by focusing on the property and the value transfer. Trust in technology has been demonstrated around the world but most people still need to know with whom they are dealing and so identification remains a key challenge, apart from the risks of money laundering. We are hearing of a lot of developments in identifying methodologies which seek to solve this problem, after which blockchain and similar technology will be much more acceptable to people and governments.

Finally money now has a parallel which is proving to be a challenge to state dominance in the sector and states are reacting in two contradictory ways – some blocking and some studying possibilities. Regulation is coming, hopefully where it is needed.

These are exciting times and Dr Ganado congratulated the team at Ledger Projects and, on behalf of the audience, invited them to continue their exciting work in this area, whilst looking forward to new applications.