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BLOCKCHAIN
Australia
The central point of media news and content for blockchain

INDUSTRIES EMBRACING DECEMBER 2018 | ISSUE 01

THE TECHNOLOGY

HOW AUSTRALIA IS
DRIVING BLOCKCHAIN
INNOVATION

Blockchain
explained
WHAT IT IS. WHY IT MATTERS.
THE CURRENT AND FUTURE STATE
OF THE EMERGING TECHNOLOGY.

WELCOME
Blockchain Australia is a
publication produced by
ADBITmedia and Lakeba
to help educate and inspire
the market about
Blockchain technology
developments and their
relevance for Australian
and global businesses. In
the coming editions we
will explore the ecosystem
that can surround
Blockchain like ICO’s
cryptocurrencies and coins.
ADBITmedia: Aaron Monks
Lakeba: Giuseppe Porcelli
Darren Younger
Editors: Myrna Van Pelt
Matt Overington
Contributors: Michelle Hutchison
Kevin O’Hara
Matt Overington
Steve Vallas
Art Director: Fleur Anson
Managing Craig Green
Editor: craig@360dmg.com
Blockchain Australia has one
agenda, to become the central
point of media, news and
content for Blockchain and
Blockchain related
developments and events from
Australia and around the world.
www.360dmg.com
© All rights reserved 360 Degree
Media Group (360DMG) 2018.
Commercial in Confidence
2 BLOCKCHAIN AUSTRALIA 2018
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W
e take information and the technology
that underpins it for granted. Today, the
answer to even the most obscure trivia
question is a quick Google search away.
Staying in touch with friends, relatives and colleagues is
as simple as launching an app on a smartphone. There’s
little doubt the internet and cloud-based technologies
have changed the way we interact with the world around
us, but the core tenets that drive the flow of data have
remained unchanged for decades.
The uptake of digitisation has provided myriad
conveniences and benefits across almost every aspect of
daily life but as society has come to rely on digital data,
more information than ever before is stored in an electronic
format. With this shift has come a need to ensure data
is stored accurately, responsibly and accountably.
Though its origins can be traced back to research
conducted by computer scientists in the late 1970s,
Blockchain technology has existed in some form since
2008, and was initially popularised to facilitate the
development of cryptocurrency. However, at its heart,
Blockchain is a technology underpinned by cryptography
that enables two separate entities to establish trust and
share information.
Just as protocols have been built to ensure an email
sent from one computer can pass through a network
of interconnected computers to arrive at its destination,
blockchain technology provides a way to ensure
auditable sharing and provenance of data. Blockchain
Blockchain
EXPLAINED
includes a digital ledger in which transactions are TRUST REIGNS SUPREME
recorded and available for inspection and auditing, IN ENABLING DIGITAL
making it not only secure and accountable, but also TRANSACTIONS
decoupled from a central authority. Steve Vallas
Blockchain represents the convergence of technologies Blockchain APAC – Founder
that seek to incorporate and prioritise elements such as
distributed and decentralised networks, privacy,
immutability and participant agreement in accordance
with the needs of its users or use cases.
Early momentum and use cases have by and large
involved speculation in the field of cryptocurrency – the
growth of the likes of Bitcoin and Ethereum from far-
flung recesses of the dark web to legitimacy have captured
the attention of financial institutions and investors alike.
Though speculation has gone hand in hand with
volatility, the lure of windfall gains has been too much
for many to resist. However, as the understanding and
This publication has been produced independently of the Australian Financial Review newsroom.

maturity of the technology has shifted, blockchain is
emerging as an attractive opportunity to drive change
across a range of industries. The maturation of blockchain
technology has the ability to underpin a massive disruptive
shift in how humans interact with each other, how trust
is perceived and ultimately how global trade is conducted.
The elements that commonly make up a blockchain
are myriad and largely depend on the application for the
use of the blockchain itself. Blockchain technology has
the ability to fuel borderless peer-to-peer lending, track
provenance of goods and services and ensure smart
contracts can be executed between parties.
THE REGULATORY CLIMATE
Government has traditionally lagged when regulating
around changes in technology and blockchain has been
no different. The application of existing regulation in the
blockchain and cryptocurrency space is a contentious
issue among ecosystem participants. Accusations of
regulation stifling innovation are rife, but the Initial Coin
Offering (ICO) model that fuelled early volatility in the
value of blockchain-based cryptocurrencies has hastened
the need for reform.
The protection of consumers and investors necessitated
regulatory involvement, initially at least at the fringes.
Government has traditionally sought to proactively
discourage inappropriate behaviour and then to pursue
those who have sought to circumvent applicable laws
for financial benefit.
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The Australian Securities and Investment Commission
(ASIC) has been consistent in its position that the scope
of its monitoring powers were adequate to police errant
behaviour. As recently as September 2018, ASIC advised
that it had stopped promoters of ICOs and funds that
invest in crypto-assets from raising money from retail
investors. This sent a strong signal to the market that the
organisation is willing to actively intervene in projects it
deems to fail to meet regulatory requirements.
AUSTRALIA AS A GLOBAL PLAYER
Broadly speaking, Australia is in lockstep with larger
economies in the European Union and the United
States from a regulatory perspective. However, many
smaller countries have moved more aggressively to
embrace and adopt blockchain-based initiatives. The
digitisation of assets removes many of the economic
impediments of geography and creates an environment
for smaller jurisdictions in particular to be over
represented in benefiting from investment and capital
inflow. Initiatives in Estonia, Malta, Taiwan, Switzerland
and Singapore amongst others are shaping the worldview
of what’s required to encourage investment in
Blockchain technology.
The Australian blockchain ecosystem is gaining
momentum as businesses increasingly build use cases
and develop an appetite to experiment with the
technology. For example, in August of 2018, the
Commonwealth Bank raised a $110 million dollar bond
for the World Bank’s economic development fund built
on the Ethereum blockchain.
And it’s technology that’s gaining steam well beyond
the space of cryptocurrency. The CSIRO’s innovation
centre Data61, IBM and law firm Herbert Smith Freehills
this year partnered to develop the Australian National
Blockchain (ANB); an initiative that enables organisations
to manage contracts transparently, ensuring all signatories
are informed and accountable.
THE ROLE OF EDUCATION
It’s imperative that businesses looking to go down the
path of deploying a blockchain-based solution are well
informed. Given the relatively nascent state of the industry,
educational institutions around the globe are beginning
to embrace blockchain. Local institutions including Sydney
At its heart, University, RMIT and Macquarie University are working
to incorporate blockchain-related material into curricula.
Blockchain is a
Education plays a critical role at a strategic level as all
technology decisions in a blockchain environment have consequences,
underpinned by benefits, trade offs and costs. The development decisions
cryptography made by those creating products and platforms require
that enables consideration of the importance of each element in the
two separate ultimate outcome they are seeking to achieve for users.
Much of the confusion associated with defining
entities to blockchain results from a failure on the part of those
establish trust asking to be able to understand the ultimate user of the
and share product and their requirements. However, as appreciation
information. and knowledge of the application of blockchain technology
continues to grow, it stands Australia in good stead to
emerge as a leader in this space.
2018 BLOCKCHAIN AUSTRALIA 3

De-risking
THE BLOCKCHAIN
JOURNEY
LAKEBA FUTURE HUB CONSORTIUM
GALVANISING THE INDUSTRY
Myrna Van Pelt
T
he growing momentum of blockchain
developments in Australia is self-evident by a
number of visible aspects typical of the
introduction of new and disruptive technologies.
This includes the range of organisations announcing their
intent to invest in the technology itself, by the rapid rise
in the number of blockchain development companies,
strategic advisory practices springing up both as sole
providers or as new advisory offers in the larger consulting
firms, and the growing focus of new curriculum designed
to nurture the growth of relevant blockchain technology
skills in leading Australian tertiary institutions.
Proportionate to the groundswell of industry
support and investment, there are equal numbers of
observers and sceptical watchers, waiting for the fervour
to settle and the blockchain high to bottom out. Gartner
notes that for key decision makers, and CIOs, it’s necessary
to understand what blockchain is and how it works, and
more importantly, how the technology can be utilized
to further mission-critical business priorities — or even
disrupt the business completely. On a global scale, growth
in the blockchain sphere is accelerating, with The World
Economic Forum predicting that blockchain technology
will enable 10% of global GDP within the next 10 years.
Beyond the fast growth of the blockchain advisory
sector there’s a gap in the market to guide and step
business through the complex journey of blockchain and
its application for driving the promised business
transformation and improvements that new and emerging
technology offer. Many CEOs find it confronting to sort
through the hype and find genuine purpose for blockchain.
While most sectors will benefit from blockchain, it’s
not the panacea for all, and needs a fit for purpose,
customised approach. That’s not to undermine the power
of blockchain, rather, understanding where the application
can deliver the most transformative power, is the first
vital step on the blockchain journey. What follows is
bringing the various functions and skills together to enable
the right blockchain solution, and this is where businesses
can often falter in their journey.
4 BLOCKCHAIN AUSTRALIA 2018
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Australian technology innovator Lakeba Group
recently launched a consortium of leading technology,
law, taxation and educational firms, with a focus on
accelerating blockchain adoption and development by
Australian businesses. Called the Lakeba Future Hub,
the initiative provides a proven consulting model for
Australian businesses looking to adopt blockchain
solutions from conception, to development and
Giuseppe implementation of the solution, all the way through to
Porcelli tax, legal and regulatory compliance.
“With the strength and insights provided by significant
Future Hub partners such as Microsoft, IBM, Macquarie
University, Piper Alderman and Grant Thornton, the
Future Hub provides a 360-degree partner to any business
This is one of wanting to explore, invest and benefit from the
the most transformative power of the blockchain technology,” said
Giuseppe Porcelli, CEO and Founder, Lakeba Group.
exciting times
“All our partners involved will benefit in shared
for the knowledge, and in having expert partners on tap to help
adoption of their own customers in the development and
blockchain and implementation of blockchain and other emerging
distributed technologies such as Machine Learning, AI and Quantum
ledger Computing. Ultimately, we want to drive an entrepreneurial
mindset for Australian businesses and strengthen enterprise
technologies level innovation in this market. This cohesive, aligned
by Australian group of industry experts are here to guide and help
business. derisk the blockchain journey for Australian businesses.”
“Lakeba is one of the first to have commercialised
a range of blockchain solutions as a result of recent
 ADVERTISING

strategic partnerships across a

number of industries including
energy, education, resources, The Future Hub brings a new
banking, and professional level of support to Australian
services groups. The accelerated businesses in the emerging
investment in the development technology sphere. The offer of a
of blockchain solutions by our
customers, is evidence of the
one-stop shop for the building of
fast-growing demand and blockchain developments, is
confidence of business leaders unlike any other collaboration
for this emerging technology,” currently available in the market.
said Giuseppe.
“Since launching the Future
Hub earlier this year in July, we
are progressively expanding the remit and the scope of TOMORROW´S
innovation
partners to further strengthen the blockchain development
and commercialisation ecosystem for those industries
ready to take the blockchain journey. We’re finding a
diverse range of industries who are putting up their hand

leaders
and approaching the Future Hub. The momentum of
the Hub is already bearing fruit with a range of live
blockchain implementations in progress in the banking,
energy, accounting and tourism sector,” said Darren
Younger, Lakeba’s Chief Growth Officer and Head of
Lakeba Future Hub.
Aryk Bechler, Tax Partner, Grant Thornton, noted the
alignment with Lakeba’s Future Hub offers a powerful
incentive for progressive business organisations to embrace CODE THAT MAKES AN
emerging technology, giving them license to thrive in an IMPACT ON BUSINESS
ecosystem that delivers on three critical aspects; legal, Matt Overington

taxation and the technology development itself.
“The Future Hub brings a new level of support to
Australian businesses in the emerging technology
sphere. The offer of a one-stop shop for the building
of blockchain developments, is unlike any other
collaboration currently available in the market,” said
Aryk Bechler.
“The benefit of this partnership with Lakeba will help
put Australian businesses on the right trajectory for
accelerated blockchain adoption. Our blockchain team
at Piper Alderman has recognised expertise, with a deep
understanding of the disruptive nature of this technology
and legal issues arising from the use of blockchain and
DLT”, said Michael Bacina, Partner in the Piper Alderman
Cryptocurrencies and Blockchain Group.
“This is one of the most exciting times for the adoption
of blockchain and distributed ledger technologies by
Australian business. With the right advice, Australian
business leaders will have the confidence to extend their
investment in blockchain solutions,” Michael said.
“As a Future Hub partner, Microsoft has the ability
to help connect and collaborate to accelerate the digital
transformation and success of customers. The Lakeba
Future Hub is a good example of an ecosystem for
businesses to commence their journey into the emerging
technology sphere,” said Anita Sood, ISV and Next
Generation Partnerships Lead, Microsoft Australia.
A
s blockchain technology continues to
evolve, educational institutions are
adjusting to meet the demand of a business
landscape focused on providing graduates
with vocational skills. The next generation of business
leaders will require an innate understanding of the
application of blockchain technology and a capacity
to realise the implications of distributed trust.
Macquarie University has played a leading role in
looking to the future needs of education. Professor
Smith references blue ocean strategy, a concept
introduced by W. Chan Kim and Renée Mauborgne
to describe an uncontested market space where
emerging technology can render competitors irrelevant
when discussing blockchain.
“The applications of blockchain technology are yet
to be fully developed. While the technology is changing
rapidly, it’s critical to ensure the next generation of
graduates are informed and able to plan through its
implications,” he explains when discussing why blockchain-
specific courses are planned to sit within the Department
of Applied Finance.
In speaking of the rapid evolution of the technology,
Smith points out the importance of fostering an
understanding of the strategic application of the
technology: “There’s a need to understand the framework

2018 BLOCKCHAIN AUSTRALIA 5


of blockchain and be able to apply it. In the future, there
are going to be a lot of people that can code on a
blockchain, but they need to know where it can impact
a business. The course material is very much focused on
strategic development and delivery, not necessarily on
the technology itself,” he says.
Delivery of vocational-based material that can be
immediately practical is a focus for all learning institutions.
“Macquarie University has approved a new Masters
specialising in FinTech, the Masters of Banking and Finance
(Fin Tech),” says Smith. “We have also redrafted the
curriculum to include FinTech in the Undergraduate and
Applied Finance programs through practical application
in the Macquarie Finance Decision Lab.”
The development and approval of a curriculum is
typically a slow process. However, while large institutions
are ramping up their plans to incorporate blockchain
into degrees, independent organisations are also focusing
on offering specialised diplomas and equipping students
with specific knowledge.
One such example is the Advanced Diploma of Applied
Blockchain, developed by the Blockchain Collective. The
course, which comprises between 1780 to 1820 hours
of learning (subject to electives), could be delivered in-
person or via the internet, and has been developed to
empower students with knowledge that could be applied
for up to ten years into the future. And it’s not just
Australian students that stand to benefit.
“A number of universities today offer only short
courses and without sufficient depth, so the curriculum
prepared by School of Blockchain offers huge export
potential,” explains Nathan Burns, Co-Founder of the
Blockchain Collective.
“Blockchain is here to stay and a formally approved
curriculum is required to help businesses take this journey.
6 BLOCKCHAIN AUSTRALIA 2018
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The School of Blockchain offers Australia’s first accredited
education product at the advanced diploma level.”
Similar to Macquarie University’s approach, the
material is designed to empower students to understand
the capability and applications of the technology.
“It doesn’t focus on the cryptography and tools, but
rather the strategic implementation of the tech,” he
continues.
BROAD APPLICATIONS
Australian demand for skilled graduates is set to grow
in coming years. Organisations like the Commonwealth
Scientific and Industrial Research Organisation (CSIRO)
are experimenting with a range of blockchain
technologies and are looking to scale them. The
organisation has stated that digital innovation – of
which blockchain is a core component – can deliver
as much as $315 billion in gross economic value to
Australia over the next decade. The World Economic
Forum predicts blockchain technology will enable 10
percent of global GDP within the next 10 years.
In June of 2018, Macquarie University partnered with
Lakeba Group to launch an Australian-first blockchain
commercialisation accelerator program. As
part of the initiative, students are able to apply
Having more graduates their knowledge of blockchain to real-world
emerging from Australian scenarios and is designed to attract the brightest
universities with blockchain and most passionate students who show an
aptitude and desire to become drivers for
skills will continue to
technology innovation.
advance the field and “Having more graduates emerging from
help ensure Australia Australian universities with blockchain skills
remains competitive. will continue to advance the field and help
ensure Australia remains competitive,”
concludes Professor Smith.

BLOCKCHAIN AND THE
internet of value
HOW A VISIONARY IS STEPPING INTO THE
UNKNOWN TO SOLVE PROBLEMS
Michelle Hutchison HiveEx – Global Head of Communications, Compliance
F
red Schebesta is a visionary. After almost two
decades of building online companies with
business partner Frank Restuccia, including global
comparison website finder.com, Schebesta is now
stepping into the unknown, with the belief that
cryptocurrency and blockchain technology are the future.
“I think cryptocurrency is an emerging market, and
one to watch. What a lot of people don’t realise is that
cryptocurrency and blockchain have only just begun,”
said Mr. Schebesta.
“We’re entering into the Internet of value. Before
blockchain, we could never send value over the Internet.
We could send an image or a video but sending money
over the Internet is a revolution. The reason why we can
do that is because we’ve leveraged a 28-year-old technology.”
Mr. Schebesta and Mr. Restuccia’s latest start-up,
HiveEx.com, is an over-the-counter (OTC) brokerage
service that helps people buy and sell large volumes of
cryptocurrency, with trades above $50,000. It’s backed
by Finder Ventures, which is wholly owned and self-
funded by the duo.
Mr. Schebesta has fast become an expert in the space.
He’s been appointed on several Initial Coin Offering
(ICO) advisory boards, become an international speaker,
and partnered with blockchain financial services company
Ivy to launch Ivy Pay, which allows people to offramp
their cryptocurrency directly into their bank account.
“Being able to buy and sell large volumes of
cryptocurrency was a really hard thing to do and there
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aren’t a lot of places to do that,” said Mr. Schebesta. “A lot
of crypto investors are looking for a way to on and off-ramp
crypto. We provide a smooth way to make that happen.”
The early success of HiveEx, which launched in
February 2018 and already trades tens of millions of
dollars each month, was attributed to its ties with
Finder, a reputable business with hundreds of banking,
insurance, retail and technology partnerships established
all over the world.
Mr. Schebesta is the driving force behind HiveEx.com
and its vision to change the way people do banking. “We
have the reputation and the financial backing from Finder
to guarantee our trades. Most other OTCs don’t have
that. By providing institutional-grade liquidity for
cryptocurrency, we can get prices that private clients,
businesses, funds and institutional investors can’t access.”
“Finder’s mission is to compare everything and crypto
was something that we wanted to compare.
We started in the crypto space in 2017
when we launched Crypto Finder, which
compares cryptocurrency exchanges. We
then went one step further and launched
our own OTC service with HiveEx.com,”
said Mr. Schebesta.
“Blockchain technologies are hard; they
are not fully scaled, not built out, not fully
developed. And because of that, it’s all
unknown and you’re going into uncharted
territory and inventing things. It’s crucial to
understand that we’re on the forefront of
this emerging technology.
“It’s also helped us understand and learn more about
financial services such as know your customer (KYC)
and anti-money laundering (AML) requirements. I want
I think us to be pioneering new ways of applying this new
cryptocurrency technology to Finder and to our future businesses.”
is an emerging Despite cryptocurrency launching just shy of a decade
ago, Mr. Schebesta believes we still have a long way to go
market, and
before cryptocurrency will be part of our everyday lives.
one to watch. “Being in the cryptocurrency and blockchain space
What a lot of today is just like the Internet was in the early 90s and
people don’t 2000s. In the beginning, we had Bitcoin and it was very
realise is that difficult to use. What we’ve got now is much easier ways
cryptocurrency of buying and selling crypto with wallets, brokerages and
digital exchanges.
and blockchain “The next phase is the idea of raising money with
have only cryptocurrency. This gave access to new types of projects
just begun. that retail investors couldn’t access. All sorts of projects
are being constructed now in this space.
“What we now need is some major applications of
the technology. User experience is still very difficult but
we’re working on all these problems. It’s just going to
take some time, at least another two to three years before
we’ll see another major application of cryptocurrency
and its usage in our lives.
“But to write it off because of all these problems
now is like writing off Amazon when it first began.
Anyone who writes off cryptocurrency in its current
format probably wouldn’t have bought Google or
Facebook at their IPOs.”
2018 BLOCKCHAIN AUSTRALIA 7

AUSTRALIAN TAXATION
keeping up with
technological change
BLOCKCHAIN TECHNOLOGIES USHER IN
NEW ERA OF TAX COMPLIANCE BASED
ON ACCOUNTABILITY AND AUDITABILITY
Matt Overington
T
he implementation of new technologies
inherently introduces challenges for regulators
and industry bodies that are called upon to
draft and administer legislation to ensure they
keep up with technological evolution. While blockchain-
based currencies were initially considered limited to the
dark web, broad-based adoption of blockchain technology
and cryptocurrencies has introduced some challenges
the ATO has worked to address.
Blockchain Australia is a grass-roots organisation formed
in 2013 by a self-described group of, “coders, visionaries,
start-up business owners and regular people that appreciated
blockchain technology”. The organisation has campaigned
to share information about the technology and aid Australian
individuals, families, businesses, larger business and
government departments to navigate the landscape.
In May of 2017, the Australian Government announced
that it would treat digital currency (such as Bitcoin) in
accordance with regular currency. Previously,
cryptocurrency holders were charged GST twice – once
on the acquisition of crypto assets, and again on the goods
purchased via cryptocurrency transactions. The legislative
amendments, which came into effect from July of 2017,
ensure that purchases of digital currency are not subject
8 BLOCKCHAIN AUSTRALIA 2018
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to GST, both recognising and legitimising the role digital
currencies play in the global economy.
“The sooner people understand and use blockchain-
based applications, the sooner we can enjoy the benefits
of the increased efficiencies, reduced costs, lower levels
of fraud and reduced frictions of bureaucracy,” said Adam
Poulton, President of Blockchain Association of Australia.
Melbourne-based Grant Thornton Tax Partner Aryk
Bechler provides tax advisory and compliance services
to a range of client groups and sees blockchain-based
technologies as a growing facet of the business landscape.
Currently the ATO has placed the responsibility on those
acquiring or disposing of cryptocurrency to keep records
of their transactions. “From a tax perspective, the
availability of a public ledger offers an inherent level of
accountability”, says Bechler.
“Fines are the primary threat to businesses not following
tax regulation and it’s critical businesses
remain aware of their obligations to
ensure compliance,” continued Bechler.
It’s both the accountability and wide
range of potential applications of
blockchain-based currency that
Blockchain Association of Australia has
identified as the greatest assets of the
burgeoning technology.
“Blockchain is a fundamentally
different type of technology to all other
digital disruption in that it is disrupting
the very core parts of both financial and
governmental systems. By simply
adopting a digital blockchain-based dollar and a digital
blockchain based ID system, the government could disrupt
hundreds of thousands of government jobs and in the
process save billions of dollars,” says Poulton.
One example that affects each of Australia’s businesses
required to submit a quarterly BAS: “Imagine retail
purchases happening with a blockchain-based dollar; the
GST component could be sent directly to a government
digital wallet instantly. This change will increase accuracy
while reducing the time requirement of the business
owner to fill in and submit a Business Activity Statement.
Blockchain is a It will ensure compliance.”
fundamentally “This technology offers a paradigm shift in the way
different type people think about money and value,” he continues. “This
of technology adjustment [presents] a huge barrier to adoption that a
to all other lot of people and organisations are facing. The technology
is a game-changer for many industries and business models
digital all over the world. We will see a dramatic movement of
disruption in wealth from existing legacy industries to new blockchain-
that it is enabled businesses and applications.”
disrupting the Anecdotally, adoption of blockchain-based solutions
very core parts covers the gamut of industry sectors from logistics to
manufacturing, the provision of financial technology and
of both
government services.
financial and “Large clients in Australia are embracing this new
governmental business opportunity, and it’s incumbent on advisory
systems. businesses to be skilled in providing a view on the
impact technology has on taxation and compliance,”
closes Bechler.

T
hough global growth is currently tempering,
Australia's economy is expected to stay ahead
of the majority of advanced countries according
to November 2018 reports by the OECD.
However, this growth hasn’t prevented industry leaders,
including Gina Rinehart, Lindsay Fox and Anthony Pratt,
from calling on superannuation-based business lending
to be opened-up to spur economic growth.
Banks have tightened already strict business lending
criteria in the wake of scrutiny throughout the past year,
with industry leaders suggesting superannuation be tapped
as an alternative source of long-term business funding.
Leading the charge is Visy Industries Executive Chairman,
Anthony Pratt, a staunch supporter of superannuation
business lending. He points out that where 45% of pension
funds in the United States were loaned to business, in
Australia the figure was a fraction at around 1%.
Calce (www.calce.io) is a young Australian business
that has developed a framework to enable super funds
to lend to business devoid of risk. “Privately owned
businesses in Australia have traditionally had limited
access to low cost, unsecured finance, and we wanted to
create a system that reduces risk and works for both
parties,” explains Ian Meares, founding director at Calce.
The team has commenced development of a platform
in which investors can set terms, agreeing up front on
interest rates and the types of business to lend to. Businesses
are screened on to the platform to ensure a very low
default risk. Super funds are able to guarantee members
an on-time return on investment, typically rolling debt
over a 100-day cycle, combined with the option of Calce
assuming the risk of repayment default. By taking this
approach, Calce is able to provide business finance at a
reduced cost compared to traditional lending institutions
thanks to the efficiencies afforded by blockchain
technology and smart contracts that automate transactions
once terms of agreements are met.
“Around $50 billion is tied up in work-in-progress and
accounts receivable across the top 500 private Australian
businesses, while at the same time it is becoming harder
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AUSTRALIAN COMPANY CALCE TO
revolutionise
business
lending
SUPERANNUATION INVESTMENT IN
BLOCKCHAIN TO SPUR ECONOMY
Editorial contribution
for small and medium sized business to access finance.
The trillions of dollars in superannuation funds have the
potential to unlock dormant value within the Australian
economy and provide business with much sought after
cash-flow liquidity,” continues Meares.
“Securing finance is a challenge for all but the biggest
businesses,” says Michael Gibcus, Founding Director at
Calce. “Calce offers a win-win solution for both business
and super funds. Businesses faced with extensive payment
terms and financial liquidity issues can free up capital
for continued growth; while super funds can provide
certainty for their members with daily interest returns
and automated and regular repayments.”
GROWING INDUSTRY
Calce’s primary offering, CalCASH, is planned to be
built on the EOS blockchain, which has been designed
to support industrial-scale decentralised
applications. It is driven by smart contracts
Small businesses in Australia that operate according to pre-agreed terms
have traditionally struggled and trigger points. Investors are able to
make funds available, which are placed in
to secure finance, and we escrow until matched to a borrower.
wanted to create a system Investors receive interest due each day
that reduces risk and during the loan term, and the borrowing
works for both parties. business repays the funds at the end of the
payment term.
Alternative finance across the Asia-
Pacific region is experiencing strong growth
and a vibrant market is being created as a substitute to
traditional finance. The global alternative finance space
has swelled to slightly over $500 billion USD in 2018.
“Generally speaking, the market appreciation of the
layer of trust provided by blockchain technologies is
growing daily,” says Gibcus when asked about the
applications and the ability for distributed trust to disrupt
traditional lending models. He sees the application of
blockchain technology as being able to reduce friction
and increase transparency – and enable the Australian
economy to continue to grow well into the future.
2018 BLOCKCHAIN AUSTRALIA 9
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opportunity for companies and organisations, including

governments, to maximise how they use existing data to
offer new products and services.
"Blockchain technology is giving organisations new
opportunities to increase revenue streams through existing
relationships by sharing data and creating stronger
connections across their business networks," he says.
In explaining current, real-world applications of
blockchain technologies, Colchester points to the
Australian National Blockchain initiative as being a game-
changing ecosystem designed to enable businesses to
engage in smart legal contracting. The system is designed
to offer transparency by providing organisations the
ability to digitally manage the lifecycle of a contract with
an accessible and common audit trail.
He also believes contract-based analytics for reporting

IT FIRM THROWS
and compliance has the ability to dramatically redefine
how Australian entities manage risk.
By way of example of the potential commercial
applications of blockchain technology, Colchester

weight behind
highlights IBM Food Trust, an ‘off-the-shelf’ solution
that creates visibility, transparency and accountability in
the food supply chain, as a use case developing momentum.
The system uses a blockchain to connect growers,

Blockchain
processors, distributors, retailers, restauranteurs and
ultimately provide consumers visibility over how food
moves from farm to plate.
“The technology is almost certainly ahead,” he explains.
“the key challenge is how businesses and regulators
navigate the space and capitalise on the potential, and
we are helping them do this.”
IBM’S SUPPORT OF BLOCKCHAIN PROVIDES It’s not just "the private sector” that is paying keen
LEGITIMACY AND SUPPORTS MOMENTUM attention to the implications and applications of blockchain
Matt Overington technologies. In mid- 2018, the Federal Government

A
signed a 5-year deal worth $1b with IBM to develop
s businesses, regulators, governments and government uses of blockchain
individuals work to develop potential technology, artificial intelligence (AI)
applications of blockchain technology, and quantum computing. “The
established IT vendors are placing significant It is fair to say that Australia opportunity for blockchain to shift the
effort in demystifying and deploying solutions to make has some of the strongest way businesses operate represents a
use of the emerging tech. level of engagements in the fundamental change in thinking,” says
The cachet IBM and other global IT businesses put Adam Poulton, President of industry
behind blockchain offers legitimacy to its myriad of world, and the breadth and group Blockchain Association of Australia.
applications. Rupert Colchester, the head of Blockchain depth of the potential of “Being at the forefront of the wave
for IBM Australia and New Zealand believes in the blockchain is very exciting. of blockchain adoption – while
potential of the technology and sees blockchain offering potentially risky if done prematurely or
significant potential to transform the way organisations without due understanding or
of all sizes establish trust and deliver more value. consideration – will be highly rewarding
"IBM is laser-focused on the applications of the to the individuals, communities, businesses and
technology in business," he explains. "We see blockchain organisations that get it right,” he states.
as potentially hugely transformational in helping address Broadly, Australia is seen as advanced in terms of
modern day challenges around trust and data and in maturity, understanding and application of blockchain
enabling new business models and facilitating collaboration technology; an opinion supported by IBM, which has
across industries and ecosystems." recognised the potential of the ANZ market by placing
Colchester sees the generational shift in the way the region among its first ten locales to roll out its own
organisations view data - from traditional data silos to blockchain platform.
more and more secure sharing across companies – as “It is fair to say that Australia has some of the strongest
critical in driving innovation and enabling new services. level of engagements in the world, and the breadth and
In part through disintermediation and by creating trust, depth of the potential of blockchain is very exciting,”
blockchain-based technology offers a significant concludes Colchester.

10 BLOCKCHAIN AUSTRALIA 2018

 ADVERTISING
Blockloan
RESHAPING
TRADITIONAL
CREDIT MODELS
O
ne of the most highly-anticipated and BLOCKCHAIN-BASED TECHNOLOGY
enthusiastically embraced applications of EMPLOYED TO BOOST ACCESS TO CREDIT
blockchain technology is its ability to facilitate
disintermediated lending. The advent of
distributed ledgers and networks that don’t rely on traditional
permissions dramatically reduces the cost of establishing
trust between disparate entities. The proven maturity of
blockchain technology has the ability to connect people
seeking capital directly with those willing to lend it.
Blockchain-based lending has the capacity to facilitate
fundamental shifts in access to credit for the estimated
two billion unbanked adults globally, but it’s not just
developing nations that are set to reap the benefits.
Australian company Lodex is currently working with
Lakeba Group to build a blockchain-based credit
infrastructure called Blockloan. This comprises a highly-
secure digital wallet, and debit card as well as global retail
lending and margin lending protocols. The system has
been designed with an eye to connecting lenders with
borrowers efficiently and securely and to remove barriers
to traditional lending.
Market research indicates that the alternative lending
will grow globally at a rate of more than 53% between
2017 and 2025. Blockloan has been designed to solve a
fundamental global credit access problem by securely
connecting borrowers with lenders directly and enabling
them to establish the trust required to facilitate
transactions.
“Lodex was created to simplify and empower people Blockchain
via access to unique data and technology. With more technology has
than 50,000 members and over $400 million in loans facilitated an
auctioned within a twelve month period, we are
contributing to what we see as a new model for the evolution of
financial services industry,” said Michael Phillipou, trust that has
Blockloan co-founder and co-CEO. opened the
door to new
BUILDING THE BLOCKCHAIN ECOSYSTEM and exciting
As a business working to accelerate the uptake of
opportunities
blockchain technologies across Australian organisations,
Lakeba has invested heavily in the developing space. in the financial
The Lakeba Future Hub is backed by a consortium of sector and
technology, law, taxation and educational firms, with a beyond.
focus on accelerating blockchain adoption to stimulate
economic growth.
“Blockchain technology has facilitated an evolution
of trust that has opened the door to new and exciting
opportunities in the financial sector and beyond,” said
Darren Younger, Chief Growth Officer, Lakeba and Head
of Lakeba’s Future Hub.
“With Lakeba’s focus on accelerating blockchain
development across all industries, the banking and finance
industry is the most obvious sector to take advantage of
this momentum. Our partnership with Lodex in developing
the Blockloan platform will facilitate a decentralised,
transparent, low-cost way of lending and borrowing through
cash and cryptocurrencies,” continues Younger.
Blockloan employs smart contract pools that reduce
the need for lenders to bid on every loan, instead executing
according to specific criteria and providing a degree of
flexibility and peace of mind for both parties. Blockloan
is designed to provide highly-secure crypto wallets and
an everyday debit card that offers users access to funds
in real-time. Digital wallet and exchanges are able to
supply the liquidity for fiat conversions, offering a
frictionless experience for consumers.
The equities margin lending industry has been identified
as a key opportunity for the provision of crypto-based
loans and Blockloan has been designed to provide a bridge
between traditional fiat and emerging crypto-based
economies. Margin lending provides the owner of equity
shares the ability to obtain credit against the market
value of the shares, effectively allowing the shareholder
to access credit without selling the shares. Typically, this
industry has been a fiat-based form of financing, however
Blockloan has identified that with the growth of
cryptocurrencies there is an opportunity to develop a
crypto-equity shares margin lending model that allows
investors to enter the crypto market by leveraging their
existing equity portfolio.
“By embracing sophisticated, secure and pioneering
technology, coupled with our proven understanding of
global financial markets, our solution is revolutionary
and able to help solve the very real challenge of democratic
access to credit,” says Bill Kalpouzanis, Blockloan co-
founder and co-CEO.
2018 BLOCKCHAIN AUSTRALIA 11

FINANCIAL
INSTITUTIONS
investing
in FinTech
INVESTORS LOOKING FOR LONGER-TERM
GAINS BASED ON EMERGING TECH
Editorial contribution
W
hile global markets have seen enormous
volatility in the value of cryptocurrencies
over recent months, institutional investors
are recognising opportunity in the
emergence of blockchain technology.
Sydney-based Xplora Capital specialises in helping
investors navigate the emerging world of blockchain-
based businesses, and Managing Director Mark Finch
sees the sector gaining momentum as traditional market
players upskill.
Finch points to high-net worth individuals as a group
particularly engaged and interested in the potential of
blockchain-based investment assets and is adamant that
while the technology is developing rapidly, and larger
institutions are grappling with the implications, his
clientele aren’t focused on short term gains.
12 BLOCKCHAIN AUSTRALIA 2018
ADVERTISING
“Most investors at this stage are looking at blockchain
for the long haul,” he explains. “The majority are taking
a five- to seven-year view, focused on growth. That’s
where the value lies. They are not looking to create
liquidity over a 12-month process but are instead investing
for the longer term.”
When talking of smaller, disruptive players in the
market, Finch suggests that more traditional financial
institutions are keeping a watchful eye on the blockchain
space.
“There’s definitely an early mover advantage, but large
corporates are getting involved. If you look at the
Commonwealth Bank or HSBC, they are looking to
create efficiencies and solutions in various sectors and
are investing significant resources in blockchain-based
technologies.”
This approach suggests a maturation of blockchain,
but Finch is quick to point out that Xplora relies
heavily on its team of analysts to analyse emerging
blockchain technology and assess the strength of the
underlying technology stack. Implying that not all
blockchain-based technologies are created equal, he likens
the development of businesses relying on blockchain to
the early days of the Internet.
“There are lots of great companies that have great
ideas but being able to commercialise those ideas is a
There’s different proposition. Taking a longer-term view and
definitely an focusing on businesses that have good models standing
early mover on the shoulders of valid technology will make all the
advantage, difference,” he explains.
but large While Finch is bullish about the potential of blockchain-
based investments, he remains circumspect, pointing out
corporates that, “traditional investment opportunities will be around
are getting for years to come, but the innovation and development
involved. taking place in the world of blockchain and cryptocurrencies
won’t slow down. The technology is proven and is here
to stay. Any wise investor should have their feet in both”.
 ADVERTISING

of day, technology is yet to make this possible. The sector

operates using cumbersome, labour intensive manual
processes based on emails, phone calls, spreadsheets and
ambiguous, outdated estimations about outcomes.
The fragmented media buying environment has long
been ripe for transformation by trading media assets
through a global, transparent marketplace. Media buying
agency 360DMG has created CIINCH, a software solution
designed to automate the high volume of individual
manual processes in trading traditional media. While
large media agencies have built their own systems, mid-
tier and smaller agencies have traditionally employed
ad-hoc platforms or relied on spreadsheets, which has
led to inefficiencies and user error.

CREATING A MORE
CIINCH is designed as an open resource media
inventory that can broaden revenue opportunities while
algorithmic capabilities are designed to optimise

DYNAMIC
advertising campaign exposure to the right audience, on
the right medium, at the right time, for the right price.
The immediate benefit of automation is workflow

media market
efficiency, however, the ultimate opportunity is in
redefining the media agency role as an extension of a
client’s business where teams will have the capacity to
realign their functions as strategic partners for clients.
The CIINCH platform is designed to employ blockchain
and smart contract technology, providing the necessary
checks and balances for a “trustless” media buying protocol.
The platform is underpinned by a suite of tools that can
BLOCKCHAIN TECHNOLOGY TO REVOLUTIONISE service all facets of the media planning and buying
THE ADVERTISING INDUSTRY environment via an ADBIT utility token (ADBT).
Aaron Monks ADBITmedia – CEO & Founder Over the past 10 years, many industries have been

I
augmented by artificial intelligence (AI) and machine
n Australia, businesses are on track to spend around learning. ADBITmedia adopts this
$8.5B in advertising throughout 2018 and globally technology to convert proposals
this figure is more than USD$500 Billion. It’s big to workflows. An open, transparent
business accounting for eyeballs across TV, radio, The fragmented media buying system for advertisers to book
print, outdoor, online and the plethora of other media environment can be transformed media space promises to stabilise
options available in the market. by trading media assets through a market pricing by offering access
Media agencies are integral in the advertising ecosystem, global, transparent marketplace. to real-time market metrics,
providing services for the strategic planning, negotiation The winners are media buyers, superseding unreliable third-party
and placement of advertising creative for clients across industry research.
an ever more complicated landscape. In the world of
sellers and agencies who trade the The ADBITmedia marketplace
media buying, the media agencies act as the broker and product and will share the will allow media buyers to upload
trusted third party between the client and the media immediate fiscal benefits. briefs for advertising campaigns
owner. Inherently, the process between all parties is directly to the platform, and owners
riddled with outdated, inefficient manual processes and and agencies will be able to respond
archaic industry practices. to briefs by pitching directly to
Advances in technology have transformed the digital buyers. Escrow services and an auditable ledger of
media landscape and led to a 24-hour advertising economy advertising provide media buyers the reassurance that
that output detailed marketing metrics that were once campaigns will run as agreed. A key benefit for owners
dreamed of for traditional advertisers. Companies looking of media assets is real-time payments and remittances
to buy ad space now expect to be able to purchase digital removing the credit risk and potentially easing account
ads at any time of day and have access to dashboards and set-up and management. It’s estimated that as much as
real-time analytics. 30% of all available media assets remain unsold and become
In stark contrast, traditional media has been left in the a wasted opportunity due to outdated and inefficient
dark ages. Despite media buyer demand for detailed practices. The ADBITmedia marketplace will increase
analytics and the ability to purchase quickly at any time the probability of yield for media owners who can list

2018 BLOCKCHAIN AUSTRALIA 13

 ADVERTISING

remnant media on the platform. Potential buyers can

access inventory directly, fostering the agile exchange of
organic demand and supply. FROM
SMART CONTRACTS
Smart contracts are fully automated protocols that exist
on a blockchain to facilitate, verify and execute the humble
beginnings
performance of a media buying agreement. Smart contracts
allow users of the blockchain powered media marketplace
to make good on promises that have been specified in a
digital form without the need for third party
documentation. Smart contracts will help to process
platform revenue streams such as usage fees by
disseminating rewards for incentivized network effects.
ADBITmedia marketplace is a smart contract that
holds secured ADBT tokens for the provider. With an HOW A SIMPLE IDEA SPARKED
Ethereum smart contract, the user does not need to trust A REVOLUTION
the platform or the third-party to send their ADBT for Kevin O’Hara Tulla Private Equity

W
a media purchase.
The smart contract system, backed by a multi-tenanted ho’d have known back in 2008 that a
microservices architecture, will provide media buyers simple paper penned by a disputed
with security to deal with unknown sellers across borders author would change the world? Bitcoin
and media agencies with a simple method to utilize smart and cryptocurrency might be terms
contracts within their agency for planning and buying. familiar to today’s financial elite, but its foundations
The smart contract system will operate independently are far from well understood. On the 18th of August
of the core ADBITmedia marketplace providing an of 2008, the domain name bitcoin.org was registered.
additional layer of security. A mere two weeks later, “Satoshi Nakamoto” published
a paper titled Bitcoin: A peer-to-peer Electronic Cash
PERMISSIONED BLOCKCHAIN System. It was this paper that set in motion a series of
Media buyers and media agencies events that culminated in the creation of the global
demand anonymity and the utmost The immediate benefit of cryptocurrency industry.
security. A competitor’s knowledge From the outset, the concept was one that many
of another competitor’s ad spend
automation is workflow considered to be nothing more than the output of a
could have damaging effects on a efficiency however the computer nerd with a harebrained scheme: to enable users
company’s competitive advantage. ultimate opportunity is in to buy questionable products on the internet and be able
The ADBITmedia blockchain redefining the media agency to transact anonymously. However, against all odds, Bitcoin
system has been designed from the role as an extension of a continued to gather momentum. Slowly but surely, the
ground up to provide security and technology through passed through various cycles before
client’s business. Teams will
anonymity through the use of a breaking into mainstream consciousness in 2011.
permission-based private Blockchain have the capacity to realign Following the publication of the paper, industry adapted
protocol. Via smart contracts, the their functions as strategic almost overnight. Traditional technology companies
system promises to offer a level of partners for clients. upskilled and adapted to suit market needs. Marketing
transparency and security never- companies became Initial Coin Offering (ICO) execution
before achieved in media buying. specialists. Banks made the shift to adopt and embrace
digital currencies and Telegram emerged as an online
space for cryptocurrency experts to coalesce.
While the evolution of blockchain crypto currencies
has offered an impressive transformation for speculation
an, what is just as impressive is the speed and momentum
with which businesses have adapted to embrace, leverage,
and exploit opportunities associated with blockchain,
cryptocurrencies, and tokenisation.
It may sound cliché, but the dramatic evolution of
technology means many future jobs are yet to be invented.
Many people working today will need to reinvent their
careers a number of times-over in the coming decades
in order to simply keep up with the speed of technology.
The rise of artificial intelligence, quantum computing,
machine learning, and other forms of disruptive innovation

14 BLOCKCHAIN AUSTRALIA 2018


all threaten the status quo, as these innovations have the
potential to automate many of the workforce out of
traditional jobs. Yet if we look at the transformation across
many of the business sectors that has resulted from the
explosion of blockchain and cryptocurrency, it is fair to
say that the business sector seems to be up to the challenge
to take on these new innovations.
Not only do the last 12 months demonstrate how
rapidly business is willing to adopt new technology when
the use cases are presented, it shows that entrepreneurs
and companies are now far more inclined to embrace
innovation than with earlier innovations such as software
as a service (SaaS) and cloud computing.
Few technologies have been as swiftly and widely
adopted as that of blockchain and cryptocurrency. However,
the initial association with the dark web and nefarious
uses of cryptocurrency has cast a dark shadow. While
there are certainly negatives as well as positives associated
with this rapid transformation, the perceived history of
cryptocurrency as a facilitator of shady transactions has
resulted in many unforeseen challenges for market
participants. Examples of these challenges include the
ability for businesses to secure insurance, funding, and
banking relationships, with many of the larger institutions
not yet feeling comfortable with the sector.
Curiously, these challenges are actually proving a boom
for innovation, with a range of new challenger companies
such as non-bank lenders, peer-to-peer insurers, and
ADVERTISING
innovative venture capital firms
springing into action to address the
lack of appetite from the larger
institutions.
Business sectors such as legal,
accounting, payments, point of sale,
property, capital management,
investment, news, compliance,
trading, and software development
are all seeing new market participants
leveraging these gaps. This has
extended to service delivery
embracing components of the
blockchain and cryptocurrency sector
to improve efficiency of service, speed
of payments, compliance, transparency,
and access to banking.
Through this transformation and
the rapid pace at which these new
innovators are addressing these
challenges, industry is becoming more
efficient, more agile, and most
importantly, more competitive at a
global scale. Indeed, these very
companies are leading the charge with
respect to hedging Australia’s risk of
disruption arising from the very
technologies that can usher in the
future of smart services.
Business, trade and markets have
no option but to innovate and adapt
to changing environments. To this point focus should be
directed wherever efficiencies can be gained in all areas
of the economy. Blockchain and tokenisation (the process
of converting rights to assets into a digital token on a
blockchain) both have the capacity to deliver efficiency
gains across a range of industry sectors.
Tokenisation has been a key focus area for businesses
in 2018 and will be critical for the next twelve months,
both from a regulatory perspective, and also a technology
perspective. While innovators are adapting rapidly,
Australian regulators are also moving quickly to define,
optimise, and develop appropriate legislative and
regulatory instruments to capitalise on the shift. While
it is certainly proving to be an onerous process, these
regulatory instruments will provide the necessary
protections, and will also serve to stimulate and bring
credibility to the sector.
Few A significant amount of focus has been placed upon
technologies the underlying technology behind Bitcoin, and the
have been as benefits blockchain, cryptocurrencies and tokenisation
swiftly and will bring to industry. However, it’s imperative to
acknowledge the efforts of Australian businesses and
widely adopted
regulators over to instigate the shift. It is exciting to see
as that of entrepreneurs taking up the challenge at such a
blockchain and progressive rate, and the endeavours coming from
cryptocurrency. education, business and all levels of government will
place Australia in a positive space to transform our
economy with this new technology.
2018 BLOCKCHAIN AUSTRALIA 15
 ADVERTISING

LAKEBA GROUP
DRIVING CHANGE
BLOCKCHAIN INNOVATION DEPENDS
ON STRONG PARTNERSHIPS
With the combined strength of Lakeba’s blockchain
innovation expertise, and the insights and
knowledge of our partners such as Microsoft, IBM,
Macquarie University, Piper Alderman, Grant
Thornton, and others, Lakeba’s Future Hub is a
proven 360-degree partner to any business, in any
sector, wanting to explore, invest and benefit from
the transformative power of blockchain technology.

Giuseppe Porcelli
Lakeba Group – CEO and Founder

WWW.LAKEBA.COM

A BLOCKCHAIN
POWERED MEDIA
MARKETPLACE.
THE NEW WORLD STANDARD FOR MEDIA
PLANNING AND BUYING POWERED BY
BLOCKCHAIN AND SMART CONTRACTS.

ADBITmedia is an agile, global media marketplace for efficient

management, seamless trade and trustless transparency. The automation
creates workflow efficiency and redefines the media agency’s role to
be a more strategic partner and extension of a client’s business.
Aaron Monks
ADBITmedia – CEO & Founder

WWW.ADBITMEDIA.IO