In the early days of enforced social distancing measures, there was a presiding confidence that any economic disruption would be temporary and fairly short.
Analysts were nearly universally predicting a “V-shaped” U.S. recovery — a fast drop with a quick stop, then a rapid reset back to normal. End-to-end, things would recover by 2020’s end.
But things are looking far less certain now in that regard. While some experts are predicting a quick reset, a rising chorus of voices is noting that the slowdown might extend for some time still to come.
Still, PYMNTs’ surveys have found that consumers are eight times more afraid of dying from COVID-19 than they’re worried about losing their jobs or their nest eggs. As a result, many will need quite a bit of persuading when it comes to getting back out into the real world.
They must believe that the rewards of real-world commerce are worth the frictions and the risk to health — outweighing what they’ll receive if they eschew a physical experience for the digital ones they’ve become accustomed to over the past two months.
It’s a tall order, Overstock CEO Jonathan Johnson told Karen Webster in a recent digital discussion, but the power of blockchain can be critical in addressing it. He said he envisions using blockchain to create private, consumer-controlled “immunity passports” that will make it easier for customers and businesses to feel comfortable in a real-world environment.
That’s why Overstock’s investment arm Medici Ventures has turned toward firms like Evernym and Vital Chain. These startups are leveraging blockchain technology to create app-based solutions that will let individuals download and control their health records and selectively share them with businesses, industries and health organizations.
Johnson noted that when we think about what it will really take for the average consumer to feel safe sitting on an airplane, in a restaurant or at a store, it’s the knowledge that everyone around them is uninfected with coronavirus.
“I think the solution we are investing in developing is solving a problem that people are going to want solved,” he said. “An immunity passport is what that is going to look like for a lot of industries. If I can prove that I’ve got the antibodies or have steered clear of infection entirely, and I can show that on an immunity passport, that's pretty powerful.”
Or at least it could be, in terms of providing a reentry plan for consumers and businesses that balances people’s need for privacy with their need to feel safe and confident interacting with the physical world. But, Johnson noted, the first challenge is adoption.
Leading People To Try A New Thing
Webster asked about the immunity passports being developed from blockchain compared to immunity-passport app usage being enforced by the Chinese government, and whether they are designed to function in a similar way.
“Well, I don't ever want to say we’re similar to China,” Johnson noted, saying what mainly differentiates the immunity passport Overstock is investing in from the Chinese QR code-based option is choice.
The consumer chooses to access their health record via a blockchain transaction, then chooses which businesses they wish to share information with, he said.
What will likely push adoption is that some businesses have an incentive to use this technology — and require a submission of a clean immunity passport.
“If you are the Cleveland Indians or the Browns or Cavaliers, your biggest interest right now is getting people back into the seats and watching games in their stadium,” Johnson said. “That creates their incentive to require these.”
As for consumers, their motivation for adoption is pretty simple: They’ll want to go to a ball game, fly on a plane or eat in a restaurant and will have to participate to do so.
Will This Be Blockchain’s Time To Shine?
There’s a tendency when looking at decade-old blockchain technology to wonder why something billed as a “world-changing” innovation hasn’t had a bigger impact so far.
Johnson agreed that blockchain has been underutilized thus far, but he said he doesn't believe that’s necessarily a reflection on the technology itself. He said Overstock continues to believe blockchain is “the most important advance since the invention of the internet.”
The trouble, he said, is blockchain tends to get mixed up with its first killer-use case — cryptocurrency.
As a transactional technology, cryptocurrency has uses that Overstock has seen on its retail site Overstock.com, Johnson said. To buy something via traditional means, customers have to cough up a lot of information about themselves — names, email addresses, credit card numbers, the extra security code and their shipping and billing addresses.
But when they buy with bitcoin, they only need to hand over a single piece of information — a shipping address. The use of blockchain technology creates a self -sovereign identity that imports directly into the transaction and allows for smoother and simpler authentication.
The trouble, Johnson noted, is bitcoin as a use case has speed issues in terms of timing transactions properly.
“I don't think it is quite immediate enough for payments in some cases,” he said. “It’s tough when I’m in a 7-Eleven and I have to wait for the bitcoin blockchain to confirm the sale. That is not going to work for most people.”
But a solution that allows consumers and businesses to feel more comfortable returning to physical transactions will. And blockchain’s unique mechanism of securely transferring information in an unalterable way makes it ideally suited for building immunity passports — even if those using them have no idea that they’re working with blockchain.
In fact, Johnson said he advises the firms in which Overstock invests to stay away from mentioning blockchain technology too much because that will get them into a bunch of tangential conversations about cryptocurrency.
“I have worked for an internet company for a long time, [and] I have no idea how my phone works, but I know the apps, and I know how I like to use it, and I know the solutions it is offering me to the problems I need solved,” Johnson said. “I advise companies to talk about the problem [they’re addressing] and how the app solves it. The fact that it is on blockchain and that is why the solution works, that is less important.”