Cryptocurrencies have created a new class of millionaires and billionaires. Many wear flip-flops, code for 15 hours a day, and are not yet old enough to buy a beer. (As the Times memorably put it, “Everyone is Getting Hilariously Rich and You’re Not.”)
Nydia Zhang, a self-described cryptocurrency investor and blockchain enthusiast, has a very simple question: How are these young millionaires going to spend their money? “Think about the internet millionaires in the late 1990s,” she says to me. “If they had a sense of giving back, imagine how amazing that would have been?”
For Zhang, this is not just a theoretical question. She’s the cofounder of a nonprofit organization called Social Alpha Foundation, based in Hong Kong, that awards grants to projects that focus on public health, education, and the environment. A former gallerist who is also a global patron for the San Francisco Museum of Modern Art—clearly, an underachiever—she’s a link between the people with the money and the people who are trying to change the world.
This is one of the realities of the blockchain ecosystem that tends to get overlooked. Without fundraising, social impact projects languish. Without social impact projects, the blockchain drifts towards important-yet-prosaic things like “corporate supply chain optimization.”
Zhang recently sat down with BREAKER in Singapore just after she spoke on a social impact panel at the De/Centralize conference.
Tell us about “Amply,” the first project you helped fund.
It’s a project for sovereign IDs. Amply works with a local charity, in Cape Town, that builds schools for young kids. The problem is that in many places in South Africa, the kids don’t have any IDs or passports. This means that they’re basically invisible.
Can you connect the dots as to why that matters so much?
In the worst case scenario, if there’s a war or a crisis, when they get to the border, they’ll get rejected because they can’t prove who they are, even though they’re standing there in the flesh.
How does Amply solve this?
Every time a child is registered into their local school, they’ll be given a digital identity. It becomes part of their education profile, so the information is transparent, and the information is permanent on the blockchain. This could amount to hundreds of lives saved. The kids can really give a proof of who they are. They can say, This is my name. This is my age. This is my gender. This is the year of my attendance.
And this has already been rolled out?
They already ran their beta project, and I would say that up to around 400 kids have been registered.
What’s the next step?
They’re working with the local governments and more schools. The idea is to scale this, to get the whole Cape Town community, and then South Africa, to come together.
Why do you think we don’t see more stories out there like Amply?
Right now the quantity of blockchain for social impact projects is actually quite small. And you rarely hear about that.
One thing is very simple—there are not enough developers. There are literally not enough developers. The developers who might be interested in social impact don’t really think about this space, or even hear about it, because everyone is focused on the commercial applications. Their career choices are limited. Probably only one out of 100 developers want to do something like help the deforestation issues in Indonesia.
You said future might not even hear about social impact projects. What’s the obstacle there?
Everyone keeps talking about the price, price, and the market. Even mainstream outlets like Bloomberg and The New York Times. It’s a ridiculous dilemma. When the price goes up, they say, “You’re just a bunch of rich idiots!” And when the price goes down, they say, “I told you, you’re a bunch of scammers!”
You can’t win.
It’s a vicious cycle, and there’s not enough coverage of the actual social impacts. “Blockchain for social impact”…it’s just not sexy.
Given all of that “price” noise, what’s another project out there that excites you, and you think more people should know about?
One of our strategic partners is called “Alice,” which brings transparency to social funding, through blockchain technology. There are a couple of arms to this: They do donation tracking with both fiat and crypto currencies, and they also help smaller-scale charities get fundraising. Right now the charity world is still very concentrated; you have 1% of people giving to a different 1%. Alice helps out the small charities.
You just mentioned fundraising. What are your fundraising strategies, and who do you target?
We fundraise from crypto funds, ICOs, and high net worth individuals — aka “the whales.”
And many of them are so young, right?
Ages 19 to 40. Unlike the dotcom boom in the ‘90s, the blockchain wealth has happened so fast, and at such an early age. The younger generation has received such tremendous wealth. So we want to cultivate a mindset at an early age to focus on social impact. Imagine that you’re 19. And you have all the money you can ever imagine in the world. You’re like, “Okay, what am I going to do?” This is the critical moment for blockchain for social impact.
Does the blockchain technology—as a medium—help with fundraising?
Absolutely. We fundraise from the whole blockchain ecosystem, and we fundraise in cryptocurrency. We don’t even have cash.
You fundraise in crypto?
What coins do you use?
We prefer Bitcoin and Ethereum but if you have other coins, I mean, we can make it work. We don’t ask for millions. Sometimes it’s $10,000, sometimes $100,000. And transparency has become such a large issue when it comes to charity, and the blockchain is a great help with that. You can just follow the wallet and see where your money is.
What’s another example of a social impact project that you hope exists sometime soon?
One [hypothetical] example we give is a deforestation bounty system. In China, we have deforestation because the local farmers are cutting down trees. We’re thinking about having a deforestation “bounty,” which means that anyone with a smartphone, if they see deforestation happening, can take a picture and send a geo-hash to the blockchain, and report the crime.
Why is blockchain technology so well-positioned to help tackle social impact causes?
One of the first books I read about this space was Alex Tapscott’s Blockchain Revolution. I still remember one of the lines that jumped out at me [paraphrased]: “Blockchain technology can create prosperity for the vast majority, not just for the few.” It can help those in poverty. I was drawn to the transparency, and the permanency of data stored on the blockchain. For the very first time, individuals can have the chance to take control of their data, their wealth, and their ability to participate in the global economy.
You have two different arms at Social Alpha: grant-awarding (for projects like Amply) and education. What exactly do you mean by “education,” and why is it so important?
We want to encourage people to think outside the commercial box, and we want to insert this value system of social impact into the next generation. Think about it. If there’s a student who’s 19 years old, and he goes to a blockchain summit, we want him to think about social impact. Years later maybe he becomes a successful CEO, and we hope that when he looks back, maybe he remembered that there was one person, or one story, that helped him at an early age. It’s about cultivating the right mindsets and values.
How, specifically, do you do that?
We’re partnering with Blockchain at Berkeley [the student-run organization] to have them teach university classes in Hong Kong, and we’re hosting meet-ups [that focus on social impact]. Aparna Krishnan [co-head of blockchain at Berkeley’s education program] hosted one of the classes, and we’re having amazing turnout. Two hundred people attended. It was the second-highest attended crypto meet-up in Hong Kong in the last 4 years.
Just curious, what was the first?
Last question, and I ask this of everyone: What are your short-term, medium-term, and long-term visions for Social Alpha and the space?
Short-term is that we want to successfully fund five projects by the end of this year. We want to have 10 more education projects, similar to what we did with Blockchain at Berkley and Hong Kong. The medium-term goal is for people to see us as a go-to platform; they come to us when they want information for blockchain for social impact.
Hopefully, by then the world is already embracing blockchain for social impact, and we really just become…like a godmother, in a way.