Nevada looks to embrace blockchain technology to further economic growth
What is blockchain?
Originally devised for the digital currency, Bitcoin, blockchain is a public electronic ledger that can be openly shared among disparate users and that creates an unchangeable record of their transactions, each one time-stamped and linked to the previous one. Each digital record or transaction in the thread is called a block and it allows either an open or controlled set of users to participate in the electronic ledger. Each block is linked to a specific participant.
Blockchain can only be updated by consensus between participants in the system, and when new data is entered, it can never be erased. The blockchain contains a true and verifiable record of each and every transaction ever made in the system.
It’s a buzzword that’s increasingly floating through the ether and over the internet.
But, what is it exactly? And what potential does it bring to Nevada’s economy?
These were two of the focal points that a collection of policymakers, state administrators, and entrepreneurs dug into at the “Blockchain: Building a New Nevada on Trust” conference held Feb. 6 at the Nevada Museum of Art.
The impetus for developing a blockchain braintrust came roughly eight months ago, on June 5, when Nevada became the first state to approve a bill — Senate Bill 398 — that blocked local governments from taxing blockchain transactions. The nature of the bill, shepherded by Sen. Ben Kieckhefer, R-Reno, is to ensure entrepreneurs can safely and reliably use “blockchain” technology to electronically record transactions.
Simply put, the bill offers new technology startups a golden opportunity in the Silver State.
“As I was preparing for the last legislature session I was working with a lot of entrepreneurs and young business people in Northern Nevada,” Kieckhefer said during the blockchain conference. “(We were) talking about ways that we could develop and support an eco-system to change how we think about economic development, to grow the next big company here locally rather than importing it … and this was one of the bills that came out of those thoughts.”
Paul Anderson, director of the Governor’s Office of Economic Development, said Gov. Brian Sandoval’s office is “rolling out the red carpet to companies that want to focus on this innovation.”
“I appreciate Sen. Kieckhefer’s bill,” Anderson added. “It certainly put us on the map when it came to acknowledging that Nevada is ready and willing to be as nimble as those businesses want to be.”
Since the signing of Kieckhefer’s blockchain-friendly bill, there’s been a significant uptick of blockchain companies targeting Northern Nevada as a destination, said Mike Kazmierski, president and CEO of the Economic Development Authority of Western Nevada.
“It’s amazing how just a little bit of legislation can really move the needle,” Kazmierski said. “The interest has gone up dramatically since the legislation passed. We’ve had several companies and executives express interest.”
In fact, the latest company to purchase land at the Tahoe Reno Industrial Center in Sparks is Blockchains, LLC, a tech company currently headquartered in Canoga Park, Calif. The company purchased roughly 64,000 acres — which amounts to 62 percent of the space at the industrial park — and plans to relocate its operations to TRIC as soon as possible, according to previous reports.
Kazmierski noted that Blockchains, LLC, didn’t even have Nevada on their radar — but that all changed with the signing of SB398.
“The fact that as a state we’re moving forward as one of the lead states in making our state welcoming to the blockchain technology and cryptocurrency,” Kazmierski said, “it’s giving us a competitive advantage to attract talent over the next several years. Much like the leadership role in attracting selectric vehicles and drones, we have the same opportunities with the blockchain crypotcurrency growth.”
With that, Kazmierski said there is a lot more work to be done to foster that growth in the region. He pointed to the need to continue evolving policies and procedures not only in government, but also in the private sector.
The “Building the New Nevada on Trust” conference gave companies in the region insight into how policy around blockchain will impact their business models. It also focused on establishing a braintrust that will eventually create a principle-based policy and regulatory system that provides protections for users.
“The smarter we get and more receptive we become, the more these companies have an opportunity to develop and grow and invest in the next wave of blockchain,” he said. “It’s a nascent industry and we have a chance to grow really deep roots in this state for years to come.”