Blockchain expert floats e-residency’ idea
When it comes to cutting-edge ideas about emerging technologies, Alex “Sandy” Pentland has many people’s ears.
So when the man, who has previously been named by Forbes as one of world’s seven most powerful data scientists, came to Bermuda there was a sense of anticipation.
Professor Pentland, of MIT, did not disappoint as he discussed blockchain and related topics — and he left food for thought for Bermuda about potential avenues it might consider exploring.
One of those is the concept of e-citizenship, or e-residency. He is familiar with the pioneering work done by Estonia.
The European country launched an e-residency programme three years ago. The status does not grant a person the right to physically enter or reside in the country, but there are other benefits for the individuals, businesses, and for the country.
Professor Pentland said: “Digital identity is fundamental And you see certain countries that implemented this and have done a good job. Estonia is one of the leaders. It now has digital identity operational for everyone in the country, and it is used by everyone.
“They got rid of driver’s licences, they got rid of passports. All taxes are done online with your digital identity and, because of safeguards, they have had no breaches.”
He was a keynote speaker at the Hub Culture Innovation Campus and Beach Club at Ariel Sands, which is a summer-long, pop-up campus where innovators and influencers from the island and overseas have been meeting and networking.
Professor Pentland was part of a themed week that focused on digital currencies and blockchain technology. He has an extensive background in the field and in other specialities, including wearable computing, social physics and computational social science.
And as he described the Estonia model for e-residency, he said it could be something for Bermuda to consider.
“Estonia started something called e-citizenship. Any one can become an e-citizen and set up a company, do business from there and you never have to have set foot there,” he said.
“To be compatible with other countries they don’t collect tax off this. If you start your own company you are likely to hire a bookkeeping accountant that is in Estonia.”
He said the country is not looking for tax revenue, and if your company made money in another country it would pay the relevant taxes in that country.
“So they are not looking for the tax revenue as much as the network effect, and the fact that they have got people’s eyeballs captured to do this.”
Professor Pentland said that when he told Estonians he was coming to Bermuda and asked them for their thoughts, they said they would love Bermuda to have an e-citizenship programme that was synergistic with them.
Expanding on that, he said: “It would be like a global small country e-citizenship. You would offer digital services the same way to citizens all over the world.
“The point is you are going to hire the local accounting firm, maybe a couple of other things locally, and be aware of the other e-citizen people and companies and things that are going on in Bermuda — and that aids the economy. That’s the deal.”
He said it would begin with an e-citizenship, a form of digital identity, then move to the creation of a company “a smart set-up” with smart contracts to support such activity.
“That’s one thing that is worth talking about. You don’t always have to do things the way they have been done. E-citizenship is an example. Why not have a consortium of countries that provide e-citizenship?”
And he also spoke about smaller countries banding together in other digital endeavours, giving them greater ability to avoid “being rolled over” by the bigger countries.
Professor Pentland is a founding member of advisory boards for Google, AT&T, and the UN Secretary General. He created and directed the MIT Media Lab, and is on the board of the UN Sustainable Global Partnership for Sustainable Development data.
During his presentation at the Hub Culture village, he also spoke about advances in digital identity, blockchain and systems for data federation, mentioning innovative projects in China that relate to the expansion of Beijing and the creation of a model city that aims to have “new systems managed in a distributed, federated way”.
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