Blockchain Backers See Potential for Flagship Industry
Cutler Ginning Up Momentum for Training Trust Fund
SEPT. 21, 2022…..To some in tech, Massachusetts could, and should, build a blockchain sector to rival Silicon Valley by investing resources in the burgeoning industry.
Tech industry advocates testified at a Joint Committee on Labor and Workforce Development hearing [last] Wednesday to show their support for legislation (H 4922) designed to lift education and training programs specializing in blockchain technology.
“It’s time to think about, ‘What is the art of the possible here with blockchain in the Commonwealth?’” John Rademacher of Tata Consultancy Services said. “It’s a technology that can bring workforce and economic development to the Commonwealth, we feel. Imagine in the next 10 years you look out and the Commonwealth has become what the biotech industry became here in Boston.”
Blockchain may be best known for enabling the existence of cryptocurrencies like Bitcoin and Ethereum, but blockchain technology itself is just a decentralized ledger, through which any participant in a peer-to-peer network can confirm transactions without needing to go through a central clearing authority.
Tech companies are exploring blockchain as a way of storing and tracking data in a variety of sectors outside of just cryptocurrency — in health care to share patients’ encrypted health information between multiple providers, in cybersecurity to better protect passwords and heal possible security breaches, or even in the music industry for artists to enter more transparent contracts and get paid higher royalties.
“I would call it a multi-stakeholder technology,” Worcester Polytechnic Institute professor of management Joseph Sarkis told the News Service, explaining blockchain technology. “Stakeholders, and any stakeholder in any situation, can access information as well as contribute information into a system that maintains a long-term record that everyone has access to.”
The House bill, introduced by Reps. Josh Cutler of Pembroke and Kate Lipper-Garabedian of Melrose, would set up a Blockchain Labor Force Career Training Trust Fund. The fund would finance grants for employers, workforce development entities, vocational technical schools and higher education institutions to develop and expand blockchain training opportunities, and to sponsor scholarships and paid internship programs for individuals seeking careers in this industry.
Advocates testified Wednesday that, though Massachusetts is home to some of the top tech schools in the country — MIT, Harvard, Northeastern, Tufts, Worcester Polytechnic Institute and Boston University — students pursuing blockchain jobs are leaving the state after graduation.
Cutler, who formed the House Blockchain Technology Caucus last year alongside Lipper-Garabedian, told the News Service “it all comes back to jobs.”
“We are always looking at the workforce, and making sure our workforce today and tomorrow are ready for exciting new opportunities,” Cutler said. “And we want to make sure Massachusetts is poised to continue its leadership role in innovation.”
Citing a study commissioned by TechNet last year, Northeast TechNet Executive Director Chris Gilrein said the tech sector at large accounts for over 450,000 jobs in Massachusetts — about 12 percent of total jobs. Gilrein said in the next 10 years they are expecting the number of job openings in the industry to grow by at least 12 percent.
“The innovation economy, it moves quickly, and our traditional workforce development apparatus may not be nimble enough to react,” Gilrein said. “As such, a targeted workforce development strategy that identifies a growth industry and works with the industry to tailor new and existing programs to meet that need, such as the one envisioned here in H 4922, is an appropriate and welcome response.”
In addition to supporting individuals, educational institutions and employers in the field, the House bill looks to fund grants for regional employment boards to develop regional strategies to support blockchain.
Funding for the Blockchain Labor Force Career Training Trust Fund would both come from legislative appropriations and other “public and private sources,” according to the bill.
Cutler told the News Service that these sources could be nonprofits, industry leaders or the federal government, if the state can leverage their funds for additional grants.
“Any kind of funding that is out there, we will have a place where it could go and be put to good use,” he said. “We don’t want this to be simply taxpayer dollars, we want to leverage everything and maximize the impact of the fund.”
Rademacher wasn’t the only advocate testifying who compared blockchain’s potential to the success of the biotech industry in Massachusetts. Vice President of Policy and Government Affairs at OpenSea Loni Mahanta compared the sectors, and said the state is poised to become a nationwide leader in the newest technology.
“Like all technology-based sectors, a well-trained workforce is key to success. With Massachusetts top-ranked public school systems and well-renowned institutions of higher education, the state is clearly well-positioned to build on its past successes in biotech and the IT sectors and add blockchain technology to its list of flagship industries,” she said.
The state invested $1 billion into the life sciences over 10 years starting the late 1990s, resulting in billions more in grants and investments in the sector.
Like biotech, Sarkis said he thinks blockchain can be used “for social good.”
He helps run the Worcester IS FAB Lab for Social Good, which focuses on blockchain and entrepreneurial activities in Worcester, and Sarkis told the News Service he hopes the lab would be one of the educational institutions that would receive funding from the House bill.
As a professor of business and supply chains, Sarkis said blockchain technology could transform supply chains, helping companies and consumers understand where products are coming from. He said he was first introduced to the technology as a way to track sustainability and ethically fished seafood. It can also be used to increase transparency on products made using slave or child labor, he said.
Rademacher said the resources the bill would pour into the sector could help transit systems in Massachusetts and normalize using cryptocurrency at small businesses.
“Imagine going from the North Shore to the South Coast with only your phone, on the safest, most secure, greenest and efficient transit system in the world, and using your MBTA loyalty points at small businesses along the way,” Rademacher said. “Those are some things that can be enabled through blockchain.”
This [past] weekend Quincy hosted Boston Blockchain Week, an annual event for over 500 blockchain enthusiasts to learn about what is new in the industry and code together at a 36-hour hackathon.
Cutler said today’s hearing “already brought together a lot of stakeholders” and he hopes the bill will have “some momentum for next term.”