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Despite being on the job for just ten days, it turns out Trump’s briefly employed communications director, Anthony Scaramucci (known colloquially as “The Mooch”), had a plan to try and turn around the White House’s dysfunctional communications team. But thanks to his now infamous profanity-laced phone call with Ryan Lizza of the New Yorker that saw him sacked by newly appointed Chief of Staff, General John F. Kelly, Anthony Scaramucci’s big ideas for getting the White House back on message and controlling the narrative never came to fruition.

That plan, which was released to the press last week, called for a major overhaul of the department he was about to head. Let’s break down some of The Mooch’s offerings and deliver some insights into what the shortest-lived communications director had planned for shaking-up a White House marred in turmoil:

Priority 1 – Improve the Culture

Scaramucci’s number one priority was to improve the culture in the communications department and this started with making nice with the press. To say relations with the media under the Trump administration need a drastic overhaul is an understatement. Trump, and his surrogates’ constant railing against fake news and declaring the press the “enemy of the American people” have drastically hampered the White House’s ability to communicate with the public other than through the president’s off-message Twitter account. While Trump will never admit it, the success of his presidency, and that of the Republican Party in the upcoming midterm elections requires a healthy relationship with the press. Bashing reporters while complaining about the mainstream media’s so-called “liberal agenda” does nothing but harm your chances of electoral success. Ask anyone who has worked on an election campaign and they’ll tell you that having hostilities with the people who help deliver your message to the public is not helpful — to put it lightly.

When you’re in the business of running the most powerful government on earth, professionalism is paramount. The Mooch called for enacting “a series of professionalizing initiatives immediately.” This included the basics like returning reporters phone calls and emails and treating colleagues with respect. Something a skilled communications team should be doing from the get-go. The Mooch also demanded an end to the threats about leaking information to the press, saying anyone who doesn’t work in the president’s best interest will be dismissed. That’s a bit rich coming from the guy who told Lizza of the New Yorker he wanted to “kill all the leakers” in his infamous phone call. So much for treating your colleagues with respect!

Constant infighting among those in the West Wing, particularly when President Trump himself publicly attacks his own cabinet, makes it nearly impossible to project a unified message. It was most obvious with former White House Press Secretary, Sean Spicer, who was constantly blindsided by President Trump’s early morning tweets, effectively derailing his own administration’s key messages.

Priority 2 – Comms is a Customer Service Operation—POTUS is the Number One Customer

Scaramucci planned to restructure the communications department to serve what he called its “various customers”. This included establishing a group dedicated to PR efforts for POTUS and his family. The goal was to “humanize POTUS and burnish his image.” The Mooch suggested the White House play up Trump’s golfing credentials, claiming him to be the best golfer to ever serve as president.  Unfortunately for Scaramucci, drawing attention to a president who has hit the links some 43 times in his 200-some days on the job probably wouldn’t sit well with the public, particularly when the majority of the population is devoid of much paid vacation at all, let alone when they’re the ones footing Trump’s bill on the course. Oh, and those tweets where Trump attacked Obama golfing — we can’t forget those! (For the record, in Obama’s first 100 days in office, he golfed once. Trump has golfed 19 times).

The Mooch also wanted to set up a crisis response team that one can only assume is to deal with the president’s 140 character morning rants in hopes of keeping the government’s key talking points on track. While every government (and company for that matter) should have a crisis response plan in place, it’s impossible to implement a successful response strategy when your organization is not aligned and constantly contradicts itself with mixed messages. Whether or not Scaramucci had the power to persuade President Trump to get on board with his plan, this was almost certainly doomed to fail, especially when it seems he acknowledged that Trump will always be Trump when it comes to bashing the media and going off-message — that is something his team would just have to swallow.

Priority 3 Make the News—We Go First

Governments have tremendous power over the news cycle. Market-moving announcements are timed for certain hours of the day depending on whether it’s good news or bad, and policy plans can be leaked to distract from possible embarrassing news that could harm government support. It’s a carefully choreographed dance, but as mentioned above, when President Trump consistently derails his comms team’s announcements, shaping the conversation can be extremely difficult. That’s why Scaramucci wanted to do a much better job in preparing cabinet members and surrogates for interviews.

Time after time we’ve seen completely different messages coming from people who are clearly on different pages despite claiming to speak on behalf of the same government. Just recently,  Trump has been beating the drums of war, declaring the US will unleash “fire and fury” on North Korea, while at the same time his Secretary of State, Rex Tillerson, is telling Americans they’ve got nothing to worry about. If there was ever a time when words matter, it would be when the leader of the free world is discussing nuclear war.

The Mooch knew how critical it was to make sure everyone stuck to the same talking points, and called for his team to act as “gatekeeper/air traffic controller over all external communications.” This is a common-sense strategy, but unlikely to work if Trump continues to unleash on Twitter and constantly go off-script.

Priority 4 – Fill the Content Void

We’ve all heard the saying “content is king,” which is especially true in a 24-hour news cycle. News networks have an insatiable appetite for content, and Scaramucci hit the nail on the head when he says “either we fill it, or they will”. The simple truth is, networks don’t have the capacity to consistently pump out fresh content. Recognizing this, The Mooch wanted Trump to regularly provide op-eds to major news outlets to “produce the story of the day, “ so that the president would set “the terms of the discussion.” This is a great idea, and Obama did this from time to time to forward his agenda.

Op-eds are great for message control, and help contain presidents and corporate leaders who often go off-script, which run the risk of turning into viral soundbites. This is by far one of the best ideas to stand out in his comms plan, and it will be interesting to see if it catches on. On the flip side, one of Scaramucci’s worst ideas was pitching to have President Trump take questions from the public via Facebook Live and other social media platforms. Opening the floodgates to criticism while the world watches live would be disastrous and almost impossible to contain, and if you’ve watched the latest season of House of Cards, you know how that turned out for a certain Republican.

Priority 5 – Jobs, Jobs, Jobs

If there’s been any good news this administration can latch onto, it is the strong job growth that has propelled the US economy since Trump took office. There’s much debate on whether Trump can claim credit, given this upward trend started under Obama’s tenure — well before Trump was sworn in. Regardless of the cause, The Mooch saw this as an opportunity for Trump to own this positive news, and knew the comms team needed to make pretty much every public communication focus on jobs. This makes sense when things are going well, but could backfire should things go sideways (war with North Korea, anyone?).

When you’re building a brand, you want to create an identity that people will associate with you. Trump positioned himself as an outsider businessman who knew how to build billion dollar companies that created hundreds of jobs. This was laying the foundation for branding him as the ‘Jobs President’, and Scaramucci wanted to run every piece of positive job news through his department to spin it to their advantage. Controlling the message this way was also intended to distract from whatever bluster Trump tweeted that morning.

Whether or not the American economy continues to do well, whoever takes over the comms department should follow The Mooch’s advice and trumpet jobs numbers as much as they can. Just don’t tweet about the jobs report like Trump did within an hour of its release, because that violates federal laws that prohibit executive branch members for publicly discussing it. Oops.

While The Mooch didn’t get to stick around long enough to put his plan into action, he did have some good ideas. He wanted to bring discipline and order to a White House comms team that has struggled to stay on-message, play nice with the press and colleagues, and ultimately act like professionals in charge of managing the message of the most powerful office in the world. Who knows what sparked that lewd tirade with Ryan Lizza of the New Yorker. We know it cost him his job. It seems as though Scaramucci was unfamiliar with the concept that you must practice what you preach. In government, business, and in life, your reputation is everything. It takes years to build, and minutes to destroy. If only he listened to his own advice, he may still be working at 1600 Pennsylvania Avenue:

“All Comms actions/decisions need to be evaluated through one and only one prism — does it help POTUS. To this end, I will lead by example and make sure that my overall conduct, tweets, internal and external comments meet this standard” — Anthony Scaramucci

As part of its internship program, Navigator asks its interns to write a blog post about the intersection of communications and an area of personal interest. First up, resident football fan Julian Caldwell.

The 2016 NFL season saw record revenues of $16 billion. The average NFL salary on a 53-man roster is $1.9 million, with the highest paid player, Oakland Raiders Quarterback Derek Carr, making $25 million. These are good times for the NFL, its players, and its fans.

Why then, are more NFL players retiring before they reach the age of 30? For professional athletes, their late 20s and early 30s are the prime of their careers. So far this offseason, 14 players have walked away from the sport altogether. In 2016, 20 players retired under the age of 30. This is in stark contrast to 2011, when only 5 players retired before the age of 30. More players are giving up millions of dollars in salary during their prime, rather than playing in a league they have worked their whole lives to be drafted into.

According to John Urschel, a former offensive lineman for the Baltimore Ravens, one of those reasons is the rise in research linking football to Chronic Traumatic Encephalopathy. CTE is caused by repetitive brain trauma and multiple concussions, which, in football, is all too common. CTE is a degenerative disease that spreads slowly through the brain, killing brain cells and affecting a patient’s mood, behaviour and memory.

On July 25, Dr. Ann McKee, a neuropathologist, published the findings of her 9-year study on the brains of 202 deceased football players. Of the 202 brains that were collected, 111 had played in the NFL, with the rest having played in semi-professional, college, and high school. Incredibly, 110 of the 111 former NFL players were found to have CTE. The severity of CTE corresponded with the intensity of the play, with the greatest severity being found in former NFL players.

McKee’s study discovered  a high probability that CTE “may be related to prior participation in football.” The findings of this study are one of the reasons John Urschel decided to hang up his cleats. Urschel is one of the most educated players in the NFL (he will continue to pursue his PhD in mathematics at MIT) and has once said that his ability to do high-level math problems was temporarily affected by a concussion. If one of the most academically accomplished players in the NFL decides to retire because he is worried about the effects football has on his brain, what message does this send parents of children who are thinking of joining the sport?

On Monday, July 31st, days after the CTE study was released, NFL commissioner Roger Goodell was at the New York Jets practice facility and answered questions at the team’s fan forum.  When asked about recent improvements to player safety, Goodell downplayed the link between CTE and football and said, “the average NFL player lives five years longer than you, so their lifespan is actually longer and healthier. And I think because of all the advancements, including the medical care, that number is going to even increase for them.”

Further, Goodell said, “I think that one thing everyone agrees on is there’s an awful lot more questions that there are answers at this point.”

These comments are in sharp contrast to Goodell’s own comments from last year, when he  confirmed statements made by Jeff Miller, the NFL’s top medical and safety official, that there “certainly” was a link between head trauma received in football and CTE. This follows years of denying that there had been any link between CTE and football, and a $1 billion settlement in 2016 to compensate former players who had accused the league of hiding risks of head injuries from them.

Despite Goodell’s claims, fans and observers can see that football is undergoing a crisis. With more evidence of the long term and deadly effects of repeated head trauma, parents will steer their kids away from football towards other sports, and more players will choose to end their careers early. Not only will these actions decrease the quality of the NFL, but they might irreparably affect the popularity and revenue that the NFL currently generates.

The NFL is not the only major sports league having problems admitting there is a problem with CTE. Gary Bettman, the commissioner of the National Hockey League, has consistently denied that there is a link between concussions and CTE. Last year, former Canadian Football League commissioner Jeffrey Orridge also denied the link between playing football and the development of CTE. With more and more evidence coming to light to the contrary, major sports leagues are going to have a hard time continuing to justify the dismissal of CTE evidence.

When companies or organizations deny reports that identify negative impacts on their employees, they get lambasted in the media and by the public on social media. What makes these major sports leagues unique is that their passionate fans continue to  financially support teams while simultaneously criticizing  the league’s leadership. Fans say they are angry and disappointed with the NFL’s reaction to CTE, but then tune in every Sunday or  buy their favourite player’s jersey. This insulates the NFL brass from the effects of their decisions, while doing little to reassure fans and players about the sport’s safety.

But this support and goodwill will one day run out. It will be a gradual process: parents will stop their kids from playing football because of the dangers of CTE, and kids that would have been great football players become baseball, soccer, basketball, or tennis stars. The quality of play will suffer, and this will cause fans to turn to one of the other major sports that offers a more exciting product. The response from the NFL’s leadership has done little to prevent this outcome.

By constantly changing his public statements on CTE, Roger Goodell is effectively telling fans that he, as the company’s head, is not confident in his organization’s ability to develop a full and honest response to the problem. Fans want to believe in the positive aspects of sport and be reminded of its numerous and feel-good stories. If the NFL is unable to develop an honest and sincere response to CTE, fans will turn away.

If the NFL wants to continue to be a staple of any fan’s Sunday, it needs to develop an honest, straightforward response and plan to deal with CTE. This will not come from ending the league’s  relationship with the National Institutes of Health for Brain Research, but by actively continuing to fund research and introduce more safety measures for its players. If the NFL is more transparent about the risks that football has on their player’s brains, people will recognize that they are trying to make the sport safer. If they don’t, and Roger Goodell continues to sidestep and change his message when asked about CTE, then both the public and players will never believe that the NFL is actively trying to make football safer. Instead, fans will see the NFL as self-serving and reckless with the lives of the very players fans tune in to watch.

If the NFL acknowledges the danger of its sport, while working openly and honestly to correct and prevent the problem, all the while explaining this to fans, then the league will be able to survive this crisis. Without an honest, clear  message, the NFL will struggle to hold its fan base. New initiatives like the NFL’s concussion protocol and rule changes introduced in 2016 will help address the issue, but for many fans they are seen as too little, too late. If fans understand the risks associated with the sport and the moves the league is taking to address them, they will continue to tune in. If they see the league as putting at risk the safety not only of professional athletes, but of everyone who picks up a football, then the NFL will fall from grace — likely taking its leadership with it.

President Trump took the unusual step this week of calling out his own hand-picked appointee, Attorney General Jeff Sessions, on Twitter:

CNN, reporting on the tweet, displayed this banner on air: TRUMP CALLS AG SESSIONS “VERY WEAK”

Any reasonable person can see that this is an intentionally dishonest read of the President’s statement. The original tweet was controversial enough. The sensationalism was unnecessary. And it is precisely this sort of exaggeration that boosts Donald Trump’s credibility when referring to CNN and other media outlets as “fake news.”

Media credibility suffers

You can blame click-driven journalism for this trend, or increased competitiveness for dwindling cable audiences, but the mainstream media’s decisions have already had consequences for their industry.

A Gallup poll from April 2017 reveals a startling lack of trust in media. More than 6-in-10 Americans say the news media favors one party over another; just 27 per cent have “a great deal” or “quite a lot” of confidence in newspapers; less than 1 in 4 has “high confidence” in television news.

The Pew Centre’s numbers, from May, are similar: 87 per cent of Republicans and 53 per cent of Democrats believe the news media favors one party. Worse, just 11 per cent of Republicans and only 34 per cent of Democrats consider national news media to be “very trustworthy”.

And CNN has fared the worst. They’re currently drawing much smaller audiences than Fox News or MSNBC. By pursuing attention-grabbing headlines at the expense of accuracy, CNN’s credibility has suffered.

So perhaps it is not surprising when, in late June, after three CNN journalists were forced to resign for a retracted story about Trump and Russia, the President seized his chance to prey on the network’s weakness.

The tweet heard around the world

At 9:22 AM, on the morning of July 2nd the president tweeted a photoshopped video of a 2007 Wrestlemania match starring himself  (who, at the time was an occasional WWE guest star) and WWE founder Vince McMahon. The video shows Trump throwing punches at McMahon with a CNN logo superimposed over his face.

Hours later, Trump retweeted it from the official presidential account (@POTUS). Since then, the original tweet has racked up 370,000 retweets and more than  603,000 post likes, making it one of Trump’s most popular tweets of all time.

Beneath the humorous video, though, the tweet carries a serious psychological subtext : CNN is just as fake as pro wrestling.

CNN’s reaction – to go on the defensive – only exacerbated the problem.

The media, predictably, were apoplectic. CNN even complained to Twitter to see if the offending tweet could be taken down for inciting violence. Without a trace of irony, the network did this even after giving extensive and uncritical coverage to Kathy Griffin’s faux beheading, and to the ‘Trump as Julius Caesar’ play in Central Park – both of which presented far more graphic scenes of political violence than Trump’s video.

In the days that followed, CNN traced the video’s source back to a single Reddit user and threatened to reveal his identity. What a sad commentary on the state of the news media in 2017: a corny wrestling video leads a national news organization to threaten to dox (online slang for revealing an individual’s personal information) a private citizen. The result? CNN was criticized from both the right and left — and the president’s wrestling video looked less goofy than the network’s reaction to it.

In the end, CNN got played by Trump and the bodyslam video. The media didn’t know how to react, and, instead, did little more than give the President four days of free coverage on its network, all the while energizing Trump’s supporters..

Trump knows exactly how to seize control of the media cycle

Even if the mainstream news media play the role of an opposition party to Donald Trump, the president has one effective lever at his disposal to provide counterbalance.

With 34.5 million Twitter followers (plus an additional 20 million on the official @POTUS account), Trump has the capacity to share his unfiltered message with a single keystroke and co-opt the news networks into covering his own words.

And when Trump tweets, it instantly shapes the public debate.

Each Wrestlemania-type post energizes Trump’s large and passionate Reddit and Twitter followings. They whip up enthusiastic support online, and spin off endless memes, predominantly among his younger fans.

Where this goes from here

There is a darker side to the president’s capacity to play the news media. Sadly, substantive news coverage may be the number one victim. The President’s more tangential “tweetstorms” are often distractions that divert media coverage from more important issues in the news – what was the public benefit of knowing whether Joe Scarborough and Mika Brzezinski visited Mar-a-Lago?

Erosion in trust in the media is obviously the longer-term concern, but it is one that is equally in the hands of the media to repair. For their part, they can start by rethinking banners like Trump calls AG Sessions ‘Very Weak.” It’s a two-way street, after all. As a White House spokesperson indicated after Trump’s recent tangle with Brzezinski, the president views his actions as “punching back” rather than starting the fight.

And the media needs to play a role in righting their ship, in part because we should not otherwise expect the CNN-taunting to stop. The weaker they are, the more Trump sees it as a winnable fight. As former White House Press Secretary Ari Fleischer recently tweeted after the Wrestlemania incident:

“The reason POTUS does it is because the press has made themselves so unpopular. It’s a fight POTUS actually wins w much of the country.”

So perhaps it’s not a channel changer, but more of a strategy. Perhaps it’s part of what President Trump means when he says his style is “modern day presidential”. In any case, President Trump is fighting the media’s sensationalism with his own. A series of his tweets from July 1 may shed light on his thought process:

“The FAKE & FRAUDULENT NEWS MEDIA is working hard to convince Republicans and others I should not use social media – but remember, I won … the 2016 election with interviews, speeches and social media. I had to beat #FakeNews, and did. We will continue to WIN!”

In President Trump’s view, bypassing and attacking the media is a feature, not a bug. What’s unclear is who will sustain the most collateral damage on the way to 2018 and 2020.

It seems unimaginable. Despite extensive media coverage about the growth of far-right and populist parties across the West, some of these most effective parties are imploding. Case in point: The United Kingdom Independence Party (UKIP). After securing a favourable Brexit vote, UKIP is collapsing under the weight of its own victory.

Why? Because despite its best efforts to create a complete policy manifesto, UKIP is a one-issue party.

It’s one issue? European Union membership. Once this balloon popped, UKIP’s grab bag of policies—opposition to privatization in health care, limits on immigration, and state funding for grammar schools—just wasn’t enough to maintain the support it had built over previous elections.

Furthermore, UKIP’s success made Brexit a primary election issue across the political spectrum. UKIP opened the door for establishment parties to make their own pro-Brexit promises. UKIP’s success in establishing Brexit as a policy all major parties would eventually agree with, destroyed the only argument the party had in its favour — that it was addressing an issue the establishment was ignoring.

But UKIP is as much a single-candidate party as it is a single-issue party. As with most populist movements today, its leader’s personal brand is as powerful as the movement itself. Former leader Nigel Farage is an icon of populist politics. His name was synonymous with UKIP for much of its existence. Repeated attempts (in 2009 and in 2015) to leave his position as leader of the party left UKIP in shambles and forced him to return to his post. Now, however, Farage claims to be gone for good. This time, it sounds like he means it. He has relocated to the United States and has seen his marriage collapse with revelations of his own infidelity.

Since his departure, UKIP has been thrown into chaos yet again. An initial leadership election in the wake of Farage’s catapulted Diane James as leader. Less than three weeks later she resigned the position, citing a lack of support among the membership and caucus. Paul Nuttal, long-time deputy leader of the party under Farage, won the subsequent leadership race and took the helm of UKIP as it entered the 2016 general election.

Nuttal’s leadership proved only marginally less divisive than James’. UKIP’s only MP, former-Conservative Douglas Carswell, had announced he would not seek re-election. He threw his support behind incumbent prime minister Theresa May. Nuttal attempted to shift the party’s policy towards left-wing economics despite his own libertarian beliefs. Despite the tact, UKIP continued to lose support week-over-week.

Which is stunning, when you think about it.

In 2015, UKIP became the largest British party in the EU parliament by winning more than 12% of the vote. It had done so by building a coalition of disenfranchised pre-Blair Old Labour voters and anti-EU Thatcherites.

Then Brexit happened.

And in 2016, UKIP’s coalition has little reason to return their support to UKIP. Jeremy Corbyn promised to follow through on Brexit. Theresa May campaigned that only a Conservative majority government would uphold Brexit. There was little reason for voters on the left or right to back UKIP. Why bother? Similarly-minded parties far more likely to form government were now on board.

UKIP’s collapse teaches us the fragility of populist parties. Parties that appeal to specific issues (like EU membership or immigration) lack the broad appeal of big-tent parties like the Conservatives or Labour. The appeal to fringe issues can generate significant support but only when it appears the establishment is ignoring these issues. When establishment parties adopt similar rhetoric and policies, support for fringe groups evaporates.

In hindsight, it’s obvious that UKIP was hurting. It didn’t have the charismatic leadership of Nigel Farage. With Farage out of the picture, it couldn’t generate the same volume of earned media attention. With Brexit in the rear-view mirror, it lacked a meaningful soapbox. Without a soapbox, it couldn’t regain the levels of support it has seen pre-Brexit. Achieving Brexit was the death knell for UKIP. UKIP is an acronym for UK Independence Party, after all. Once the UK became “independent” of the EU, there was little reason for voters to maintain their support.

UKIP’s struggle is a harbinger of things to come for other far-right populist parties in Europe. When politicians appeal to base emotions on specific, hot-button issues, they expend political capital that could otherwise be spent growing their movement to appeal to a broad range of voters. More importantly, when those same hot-button issues are resolved, their base weakens. Whatever grab bag of policies the party supports isn’t enough.

As mainstream parties in Europe and across the Western world address issues like the EU, immigration, and multiculturalism, they will appeal to voters who previously backed radical parties. As one-issue parties like UKIP prove the electoral popularity of populist programmes, major parties will increasingly adopt their proposals. This, in turn, will hollow out support for fringe parties and re-establish support for mainstream ones. In the end, while their proposals may make their way into legislation, the fringe parties themselves have little future in government.

“Whatever the particular policy issue is, if you don’t understand the technology and you don’t understand the implications, you’re setting yourself up for failure.” – Jerry Brito, Coin Center

Understatement of the year: Bitcoin has a huge public perception problem. The first thing that comes to mind is organized crime, black markets, and notorious Internet hackers using the digital currency to hide their exploits. Yet—at the time of writing— the token stands at a value of CAD $3,300 with a market cap of $42 billion.

More importantly, the underlying technology behind Bitcoin—blockchain—is quickly gaining traction among the business community in Canada and around the world. In its 2017 Global Fintech Report, PricewaterhouseCoopers says funding in blockchain companies has increased 79% year-over-year to US $450 million, and that 77% of financial institutions surveyed expect to adopt blockchain internally by 2020.

So what exactly is blockchain? And why should you care about it?

Blockwhat?

It’s a common reaction. Very few people know what the blockchain is, and the few who do are not always adept at explaining it to the average person.

Blockchain technology can best be described as an online distributed ledger, like a record book kept by a decentralized network of computers. Transactions are encrypted and recorded to this ledger, then “blocked” into a set, with each block verified by “miners” or computers who automatically and permanently timestamp and validate each set of transactions. As each block of transactions is verified, they become linked or chained to the previous block, making it nearly impossible to steal, erase or modify previous transactions.

Forget the technicalities of the network, think about what having this technology really means.

To date, we could only send digital copies of information over a network; now we can actually send digital value—without the need for a middleman. Anything of value can be openly, securely, and directly transmitted to anyone, anywhere, anytime, in a matter of minutes, and in some cases, seconds—payments; property titles; birth, death, and marriage certificates; citizenship and voting privileges; supply chain and inventory tracking; charitable donations; contracts; and anything else of value that can be expressed in computer code.

The state of blockchain technology today is much like the Internet in its early days: waiting for a plethora of user-friendly applications and innovations. Even for those of us who use the Internet every single day (and perhaps every minute), we hardly give a second thought to the infrastructure, software, and circuits in our smartphone or laptop that enable this technology. In fact, in 2017, it’s strange to say I “surf the Web”. We talk about our Internet usage almost exclusively in terms of the applications we use the most—Facebook, Instagram, Gmail, Tumblr, etc. Many of us would be hard-pressed to explain what the Internet is exactly, but we know we need it in our everyday interactions.

Similarly, whenever blockchain goes mainstream, we won’t give a second thought to the mechanics, but rather, associate our everyday transactions with those future killer apps on our connected devices. As digital economy gurus Don Tapscott and Alex Tapscott have said, we are quickly moving from the Internet of Information (i.e. email, social networking) to an Internet of Value (i.e. Bitcoin, smart contracts), and that has exciting implications for the future of blockchain technology.

A Tale of Two Disruptors

Among the many clouds of uncertainty that hang over this nascent technology, there is one that is darker than the rest: regulation. Blockchain is still developing the kind of governance structures that we take for granted in the current Internet infrastructure. In a few years, the blockchain ecosystem will face a crossroads in Canada and around the world. Blockchain companies will need to decide whether to collaborate or fight regulators.

Regulators are already starting to pay attention to the impact of digital currencies and other blockchain technologies on financial markets and local economies as they gain traction among investors and even mainstream consumers. Like fellow disruptors Uber and Airbnb, blockchain companies have been able to thrive and grow quickly by operating in a relatively unregulated environment.

The financial industry is highly regulated and will view blockchain companies as direct competitors to their business, operating outside the law and cutting into their customer base and profits. As the taxi industry and hotel industry have done before them, large financial institutions will need to decide whether to level the playing field either by embracing this new technology, or attempting to shut it down and ban it using traditional legal, regulatory and political levers.

Enter a tale of two disruptors.

Ridesharing service Uber used its popularity with consumers and its relative size to aggressively fight regulation and taxi lobbies in multiple jurisdictions. However, the multi-front lawsuits and public fights were extremely costly for the company.Sexual assault cases and incidents of racial profiling also amplified negative attention. At the same time, there was little public sympathy or patience for the unpopular taxi companies and backwards-thinking politicians at city halls worldwide. In the best cases, reasonable rules were put in place, but at what reputational cost to all involved?

Home-sharing giant Airbnb took a different approach. It worked collaboratively with regulators in different jurisdictions to share local, aggregate, and anonymized data about its home-sharing communities and joined the public discussion on how best to shape rules for its platform. Airbnb told city councils point-blank that it wanted to be regulated and taxed, and thereby legalized and legitimated. There continues to be debate surrounding its impact on affordable housing and irresponsible guest behaviour, but for the most part, Airbnb has tried to be a good neighbour to regulators and politicians in the governance of home-sharing platforms.

Blockchain technology can take important lessons from both of these disruptors’ experiences.

Do No Harm

All technology is dual use; that is to say, the technology itself is neutral until an actor uses it for helpful or harmful purposes. For the moment, experts have recommended that governments take a “light touch” to regulating blockchain, noting that any action might stifle the creative development of this ground-breaking technology.

Blockchain experts argue the benefits of blockchain technology far outweigh the drawbacks. All the same, blockchain will come with its own challenges for businesses. The Internet still has issues such as tax obligations, data breaches, money laundering, fraud, criminal financing, privacy, and others yet to manifest. Blockchain’s challenges will open up public debate on how best to govern this technology and expose both disruptive and disrupted businesses to reputational risks as they find their footing within this new wave of innovation.

Start-ups, companies, and investors will also need to learn how to navigate the regulatory environment and communicate with a public that does not quite yet understand what impact the technology will have on their everyday lives.

If you want to be ready for the Internet of Value, you’ll need the right expertise to bridge the gap between government, public opinion, and technology. If you have questions on the implications of blockchain for your organization, please reach out to the Navigator team.

Image credit: Uwe Falkenberg