A brief presentation and overview to the Washington State Legislative Committee on Economic Development & International Relation. Identity the low-hanging fruit for the state it lead in specific blockchain initiatives such as Supply Chain

1. The Growing WashingtonBlockchainEcosystem
Presentation to Legislative Committee on Economic Development & International Relation
June 2018
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2. “What the internet did forcommunications,
blockchain will do for trustedtransactions.”
- Ginni Rometty, CEO ofIBM
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3. Blockchainis the “Internetof Value”
• A blockchain is a public ledger
 Blockchains securely record transactions
between parties – neither party can make
changes
 Blockchains beyond Bitcoin and Ethereum
provide increased transaction throughput and
other benefits
 Like the Internet, it’s inherently global
 We’re in the 1998 of blockchain; outsider
rejection of insider belief
By May 2018 $1.3B venture money invested. All of
2017 was $1B

4. Therearemany…
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5. What isablockchain?
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Recorded events (ledger entries) recorded chronologically and
verified by multiple third parties. May be public or private

6. What’s is aBlockchainLedger?
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1. Eye Exam 5/12/2017
Patient 8931
2. Visit on 5/12/2017
3. Need new glasses
4. New prescription
Patient 8931
5. Prescription 99881
filled
6. Follow-up appt
scheduled 6/12/2017
7. Annual Checkup
5/12/2018
1. Eye Exam 5/12/2017
Patient 8931
2. Visit on 5/12/2017
3. Need new glasses
4. New prescription
Patient 8931
5. Prescription 99881
filled
6. Follow-up appt
scheduled 6/12/2017
7. Annual Checkup
5/12/2018
1. Maintenance record
5/12/2018 vehicle #8931
2. Depot visit on 5/12/2018
3. Need new windscreen
4. Replace windscreen
vehicle 8931
5. Part 99881 replaced
6. Tire rotation scheduled
6/12/2018
7. Oil change 5/12/2019
• Database-like rows of
shared information
• Validation and verification is
based on mistrust
• Public (or private) audit
trails
• Replicated record enabled
by many third parties
• Consensus oriented
• Written with finality
Easily and immediately global

7. 6
Why will BlockchainsbeAdopted?
200,000 transactions per day
~$12.9M in mining fees daily

8. 7
Why will BlockchainsbeAdopted?
775,000 transactions per day
~$10.4M in fees daily
Miners or Validators get paid for Accounting

9. What Makes a Good Business Case for Blockchain?
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1. Multiple parties share data
 Multiple participants need views of common information
2. Multiple parties update data
 Multiple participants take actions that need to be recorded and change
the data
3. Verify Trust
 Every participant requires validation of the transactions and integrity of
data written
4. Decentralized
 No single repository or owner of the repository locations
5. Distributed Ledger
 Data is written across multiple ledger entries

10. SupplyChain
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• Top state industries
• Aerospace
• Forest Products
• Agriculture and Food Manufacturing
• Maritime
• Military
• Common Horizontal Processes
• Supply Chain
• Insurance
• FinTech and Payments
• Financial Technology
• Document and record management
• Inherently global in nature
64% of the US apple supply is grown in Washington

11. 10
Traditional Multi-Central Data
Management
Decentralized Distributed
Ledger

12. GlobalShipping/Supply Chain
• $4T worth of goods shipped each year
• 80% via ocean shipped freight
• Documentation is approximately 20% of shipping
cost
• Maersk – Integrated shipper and transportation
company
 All parties share the same data on the blockchain
 Information is shared and written with finality
 Reduces paperwork
 Reduce opportunities for fraud
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Image courtesy CCN.com

13. Insurance
• Property and Casualty for large assets and things such as equipment and
buildings
• Allianz
 Insurance and Asset management
 88M customers in 70+ countries
• Update “Captive Insurance” between multiple global entities
 Wholly owned, insured and underwritten by the insureds
 Complex multi-sided insurance
• Benefits
 Reduces error and exchange of potentially thousands of documents between
parties
 Reduced cost
 Auditability
 Fund Transfers are simplified
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Image courtesy Alliancz.com

14. Disaster Recovery
• Data stored across multiple parties
• No single point of failure
• Less resource intensive than traditional solutions
 Accessible to smaller and regional banks
• Sheltered Harbor initiative began last year
• Candidate applications
 Banking system
 Airports – flight records
 Government records
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https://www.americanbanker.com/news/banks-underground-data-vault-is-evolving-will-it-use-
blockchain-next

15. MoreCommercialOpportunities
• Identity - $19.5B Industry
 Password Managers
 Identity Access Management
 Physical identity cards
• Government
 Licenses
 Records management and transfers (E.g., property titles)
• Financial Technology or FinTech
 International money transfers
 Know Your Customer and Anti-Money Laundering
 Micro-payments
• Entertainment
 Gambling
 In-world currencies and trading
• Construction and Real Estate
 Building plans and documents
 Insurance and permits
• Crypto miners become validators
 The ISPs of the blockchain world
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Hana Yori Dango
“Dumplings over flowers”

16. Washington’sExpanding Blockchain Ecosystem
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17. Opportunities/Barriers
• Regulators want to address single entities and not networks
 Analyze the landscape and adopt progressive regulations
• Many businesses in an ecosystem must agree and participate to realize gains
 Enable public-private partnerships to gain global attention
• Hot potato of risk - Last one holding it, gets stuck with the check
 Review regulations
• Personally Identifiable Information
 Right to be forgotten
 Where is the data shared/stored
 Keep the data only for as long as necessary
• Evolve legislation and changes in data management
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Ecommerce wasn’t
invented here but
we made it every
day
Lead the narrative in global
blockchain-based Supply Chain

18. Thank You!
Lawrence I Lerner, CEO
Lawrence.lerner@pithia.com
www.pithia.com
Twitter: @RevInnovator
Telegram: @RevInnovator
https://www.linkedin.com/in/lawrencelerner/