Introduction to 'Owl Explains Hootenanny'
00:00:06
Speaker
Hello and welcome to this Owl Explains Hootenanny, our podcast series where you can wise up on blockchain and Web3 as we talk to the people seeking to build a better internet.
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Speaker
Owl Explains is powered by Avalabs, a blockchain software company and participant in the Avalanche ecosystem. My name is Silvia Sanchez, project manager of Owl Explains, and with that, I'll hand it over to today's amazing speakers.
00:00:32
Speaker
Welcome to Owl Explains. We're here to make blockchain policy a bit more simple and also a little bit more fun, if I might say.
Exploring Blockchain in City Governance
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i am Sylvia and today we're flying into city territory where trains meet tokens and where town halls are tangling with tech.
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Joining us is Michael Minelli, former Lord Mayor of London and President of the London Chamber of Commerce and Industry. And we're getting into how cities can harness blockchain to serve citizens better and also what happens when local and national collide. So let's get started. Thank you so much for joining us.
00:01:05
Speaker
Well, delighted to be here, Sylvia. Great. So when you look at how most cities operate today from budgets, bureaucracy, service delivery, what's the one thing that's clearly broken and where could a technology like blockchain actually help?
Rethinking Governance Models
00:01:21
Speaker
Well, I never thought be talking about blockchain being fun, but I think it is. The world in many ways needs a good rethink of governance, top to bottom. And the governance models for cities vary quite wildly as you go around the world.
00:01:36
Speaker
ah We in the city of London are definitely a peculiar remnant of a form of governance which had dominated across Europe for over a millennium, and that is workers-in-residence cooperative.
00:01:48
Speaker
The city of London is actually the world's oldest continuous democratic workers and residents cooperative. And the two elements that a modern audience might not quite pick up is what you mean by democratic?
00:01:58
Speaker
Well, we've been holding elections since approximately 640 AD, not quite 1400 years. ah Those were initially for sheriffs, later for aldermen and councillors, and that's the structure today.
00:02:09
Speaker
The second element is workers. Well, what do you mean workers? Well, we have 678,000 workers in the city of London who have the vote. and we have 8,000 residents. And that is the way that it was run across Northern Europe, about 350 cities. That's Northern Italy, the Holy Roman Empire, the Hanseatic League.
00:02:26
Speaker
So concepts of local governance, which were not about residents, but were actually about economic productivity, were very common. Largely stamped out in the Napoleonic era, and we're not here for history, but you can see that the idea of localism ah was much, much stronger for a millennium, and mentioned the period that people admire.
00:02:44
Speaker
So where does blockchain come in?
Blockchain and Data Solutions
00:02:46
Speaker
Well, one of the problems that we've always had in these things is registries, any area of common data. Common data has been the the fundamental problem. and This is the the the great hope for blockchain. Now, by by blockchain, I mean any kind of mutual distributed ledger.
00:03:04
Speaker
potentially a smart distributed ledger where there's some bit of contracting ah possible across it. But it's not necessarily a cryptocurrency blockchain. Cryptocurrency blockchains are relatively recent. The blockchain concept is actually much older than people realize.
00:03:19
Speaker
We published a paper called Prior Smarts looking at blockchain ledgers back in the 70s. So they were just not called blockchains, but it was the same data structure, which was effectively a hash, except they weren't called hatches, and they were called checksums.
00:03:34
Speaker
But if you look at it technically, it's it's basically the same structure. And the opportunity affords is that we as a community of workers and residents can share data and know that that data is being used for of common good and not appropriated.
00:03:49
Speaker
So we have many examples of places where this has been successful. An easy one would be Wikipedia, where we have a ah shared common data set and a community built around it. The community is far more important than the the use of the wiki that is supporting it.
00:04:03
Speaker
We have areas where people are trying to appropriate common areas. One might look at what three words and wonder why does it need to be centralized. So ah there's ah there's a spectrum here. But blockchain affords us the opportunity to create bottom-up structures if we so wish.
00:04:17
Speaker
However, we then hit the political conundrum. But this is being done, of course, within national context. A nation state is the dominant form at the moment, ah definition of a state being a monopoly on the use of force in a specified geographic area.
00:04:32
Speaker
And these structures are, I wouldn't say they're in conflict, but there's definitely an opportunity to rejig the way that things are. And the technology of blockchain or distributed ledgers allows us to do things. So I can give you a few examples in a minute, but ah hopefully that gives your audience an opening.
00:04:49
Speaker
Great, no, that's an excellent introduction.
Cities as Complex Adaptive Systems
00:04:51
Speaker
And now that we're into this part of, okay, cities and blockchain, when we were offline, you called cities complex adaptive systems, and I thought that was a cool concept. So what does that actually mean? And how should that shape our approach when we're introducing something like blockchain, especially when we're dealing with all this pool of data?
00:05:10
Speaker
Very good. Well, there's there's a huge history starting ah ages ago in cybernetics, moving through chaos theory into complexity theory, as basically, if you're honest, scientists realize that things have unintended consequences.
00:05:27
Speaker
So, a complex adaptive system is complex. We can't quite figure out what it will do given certain parameters. It's adaptive in the sense that it seems to adapt to its environment to change and improve.
00:05:39
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Basically, it wants to stay alive and and perpetuate itself and system that there are interlinked bodies of feedforward feedback, governing, monitoring, that are all nested within one another. so you know, a city might, well, let's let's take the traditional view of a city ah that there's a mayor who's elective, so the citizenry, I've got a system of saying this is where we want to go. Somebody proposes that I'd like to take us this way, no, I'd like to take us that. We vote for her instead of him.
00:06:08
Speaker
She's now in charge and so she drives the city forward. ah blah, blah, blah, and we get feedback that the the rubbish is there, so we're going to vote her out. So it's it's a kind of a very, very complicated set of of of of interactions.
00:06:22
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Now, these interactions are not scaled. If you look at federal systems, for example, ah Germany, America, Canada, Australia, you'll see a lot more thought has gone into the way in which the levels are structured. What is central?
00:06:36
Speaker
What is state? What is local? And they ah they you see probably more commonality across American mayoralties than you would in Britain, where we have things from no mayors at all, lord mayors, lord mayors with power, lord mayors who are symbols, lord mayors who...
00:06:53
Speaker
And and it's ah it's a very, very messy structure because we've never thought in the United Kingdom about delineating our constitutional structure as clearly. In fact, we boast of having an unwritten constitution, which which I think kind of says it all.
00:07:08
Speaker
So now as we move into where you're going in in the Citi blockchain type world with a complex adaptive system, one of the other things we've lacked has actually actually been an historical record of what's going on.
00:07:22
Speaker
So blockchain affords us the opportunity to be writing these transactions out and see what was the evolution over time of of the city. So let me give you a ah good example. One of the things that cities really focus on is planning.
00:07:38
Speaker
by planning permission, buildings, you want to put a building up. I happen to have spent a of time in architectural research, but I've also been on the planning committee for the City of London and our skyscrapers and our our new public areas and things, so I've been poacher and gamekeeper.
00:07:53
Speaker
Now in a situation like that, you've got a complex adaptive system, being the city itself, but how does the city know whether or not planning is any good?
00:08:04
Speaker
You just just don't know. And i said, well, we put this building up. Well, I hate it. I think it looks terrible. No, I think it looks beautiful. and so It's the Kirkland. but what was the effect on the area? I don't know I can barely remember. Wasn't it a corner shop here a couple of years ago? and i guess you So you've got this ability to hold the record.
00:08:21
Speaker
Second thing is you have the ability to hold the future record. So, when you're on planning, let me take a simple example. um A typical fight would be over the impact of a building on the environment. We would think about things like light.
00:08:34
Speaker
But we would also think about water usage, numbers of taxis, stress on public transportation, ah wind and noise. so So, now we've got a ah decision to make. This building or not. Okay. So, it comes to us.
00:08:49
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The developer, typically, a lot of money, a lot invested, wants to make this move. And a planning authority like the City of London, which tends to be pro-planning and development where possible, the EMB as opposed to NIMBY. So, you know, predisposed.
00:09:04
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But the residents or others say, well, there's going to be a lot of noise out of this thing. And the developer will put forward a model, a very complex model of wind flow and all saying, no, no, there's going to be no noise at all.
00:09:14
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The protest ah group, if they can afford it, will then hire their own experts. Both of them will use a model. And they will tell us that it will have noise or won't have noise. And we will approve it or not approve it based on what we think.
00:09:28
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But if it's billed, we never go back and check the noise. So how are we learning? How are we being complex and adaptive? I'm proud to say, in all honesty, that very, very recently the City of London has, in fact, particularly on the area of wind and noise, actually set up a unit to actually monitor what has happened over the years. But it's that recent.
00:09:49
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And there are a whole host of other areas where we could look at. I'm going to bring thousands of visitors to our city if you give me planning permission to put up this the virtual reality museum. OK, great, Michael.
00:10:03
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But where's the evidence? Well, then, if we had the phone ah records of people coming in, you know, anonymized, but we knew that then we'd seen a whole bunch of mobile phones moving through the area, we'd go, well that's amazing, Michael put up this museum.
00:10:15
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And suddenly, we had 2,000 or 3,000 people extra every day. And that was a good mobile phone phone call there, so perfect. um No, and I think it's ah maybe ah an example you don't really think about, no like tracking the permissions for the buildings and all the city planning, because I think that many people, when they hear blockchain, they immediately associate it with but money. But what's the real value of blockchain infrastructure for cities? Not just payments, but what's like the bigger value of it ah from your perspective, like on the city perspective?
00:10:47
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Yeah. Yeah, I'm on record as
Clarifying Blockchain Misconceptions
00:10:50
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not being a particular cryptocurrency enthusiast. I'm not anti it. I'm just kind of, to me, these are a bit of gambling tokens. and ah And there are many other payment things. And I'm at least as interested in central bank digital currencies, which in many ways would make much of this superfluous. So let's leave all that to one side.
00:11:06
Speaker
And the blockchain itself has become a much abused word, strictly speaking. ah You know, blockchain that comes into being, i think around 2013. You're going to say, wait a minute, Satoshi Nakamoto, well, read his paper if you want to get me up on it. But he actually, only at one point,
00:11:22
Speaker
talks about a chain of blocks, he's referring to data structure us programmers understand. So that was the term blockchain became. And then blockchain became ah basically a portmanteau for a whole bunch of technologies. So you've got the consensus mechanism in Bitcoin, which is grotesquely inefficient, as is well known.
00:11:39
Speaker
And certainly it's not the way you're going to be running a city. yeah mean Bitcoin ah consensus mechanisms handle 350,000 transactions a day and they have millions of transactions in cities and every every hour. So that's not a feasible.
00:11:53
Speaker
Then you get to blockchain, the data structure. And it's not a particularly great data structure. It's it's also grotesquely inefficient. But the point I made earlier, it allows you to create a distributed ledger that nobody owns.
00:12:06
Speaker
And that's really important. And if you're just writing to it, it it's not inefficient. it's It's a good storage place. And we have built trading systems. Now, you're using that, where in you're actually using the ledger merely as the ultimate record.
00:12:23
Speaker
That's all. So you have to stay in sync with the ultimate record. And that's what I think blockchain can serve for a community. It becomes the ultimate record. Efficiency processing wise, you're not using it on a daily basis or anything, but it's there is that we agreed this and that's what we said at the time.
00:12:39
Speaker
And that that that that to me is the glory of it. And there were so many areas. that we We mentioned planning, which you wouldn't think about. I might talk about just access and security, you know, where are people at certain times, what's going on, there's a lot of that.
00:12:53
Speaker
Again, these are questions, you do we want to take on some of the privacy issues? We've got identity, you could have a city identity. You've got a library card, you know, there are a lot of other services that you might use if you could have an identity provided.
00:13:06
Speaker
So payments are not, one, payments are well served, two, many other payment mechanisms, and I don't think there's that much more to be squeezed out of it. Where there it is stuff to be squeezed out is in all the paperwork.
00:13:20
Speaker
The huge quantities of paperwork, if you're a business person like me and you're purchasing ah something that's going to cost you a thousand pounds because it's going to cost you a thousand pounds, okay, you know, the payment provider is taking out, you know, one and a half percent.
00:13:33
Speaker
Maybe you can squeeze them down to one percent. Great, you squeezed out half a percent. But it's the 50 pieces of documentation I needed to get it to the doc, to get it authorized, to get it insured, to get all that. Each one of those documents is costing me, what, 25, 50 pounds if somebody has to fill it in and do it and then double check it. And then if we can cut out all of that, we're going to save at least that half percent and more. So when it comes to real savings, payments are one thing, but process documentation is another. In fact, last year we we had a project in the city, which is still continuing, called Smart Economy Networks.
00:14:11
Speaker
And I was trying to say, please continue with the payments efficiency, but you've kind of squeezed most of what you're going to do out. But the real money ah to be saved is in all of the boring admin and paperwork Interesting, but I think at the end of the day, like you were mentioning, it comes down to the data.
00:14:26
Speaker
um Because it is a database. Whether you get into crypto or not, that's a different side of it. That's another thing you can do with blockchain. But the way we can think about it is like, okay, users can program on these databases, on this blockchain, to leverage, okay, their computing power to create applications that are part of a much larger tech stack for anything people's creativity can imagine or that they might need.
00:14:49
Speaker
In this case, tracking city records, city planning. um And one tension that we can sometimes see is the central versus local authority. So I want to shift gears a little bit into that. So how can blockchain help cities assert control without creating chaos or fragmentation, or can they? I'd like to hear your thoughts on that.
00:15:13
Speaker
Well, I don't think there's much more opportunity to create more chaos or fragmentation. It's it's pretty bad. you ah London is a complex city with 32 boroughs plus the city of London. New York's got its five or six boroughs complexity.
00:15:29
Speaker
All large cities are complex. In fact, they're very difficult to to actually identify. What is the boundary of London? Is it the city? Well, no, no, no, that's ancient history. Yeah, okay. is it the 32 boroughs? Well, it's kind of more the M25. Well, it's really southeast of England. you know And each of those numbers you know brings you from...
00:15:48
Speaker
The formal definition of London as measured by the ONS, I think, is 9 million. The area contained within the M25 is about 13, 14 million people. Southeast England is about 25 million people out of 67.
00:16:00
Speaker
sixty seven So you get these wildly different numbers, and you can't define it. um So I think what a lot of this is doing is just laying down the data. So if you want to analyze a borough of London, we can give you the data.
00:16:13
Speaker
And because we've geolocated it, we know we're, you know, which borough it's in. So if you're trying to analyze, say, your bus routes and determine whether or not you need a new bus route, wouldn't it be great to be doing that on hard data?
00:16:26
Speaker
Not on sampled data, not on this, but on actual real data that's that's going on. And those are, I feel, the opportunities for cities so to build these things. One of the problems, of course, is that cities, particularly in in the UK, but I know of itself, are terrified of any information technology project, IT projects tend to go wrong. So the minute you say, all we need to do is provide a database, everybody's running away.
00:16:50
Speaker
at great speed. But in truth, there are a lot of opportunities to put in, again, simple blockchain recording tile style structures that would start to record some of this information.
00:17:02
Speaker
And it's the information that, ah in my opinion, will will drive things. I might add ah as ah as a coda to this, because you know you're supposed to in any tech session throw in words like quantum and big data and visualization.
00:17:16
Speaker
So I've got to throw in AI. um but But there is an interesting point here on ai And I always talk about John Snow. in eight eighteen fifty four In 1854, 661 people died in Soho on the Broad Street water pump, which was full of cholera.
00:17:34
Speaker
And, you know, John Snow worked out epidemiology, his beginnings going, oh, I think it's this water pump and turning it off. That's the legend. um In truth, we're seeing this already on data. We are, just as they were sort weeing in their water, we are putting a lot of junk on the internet.
00:17:52
Speaker
And cities are going to have to, so a lot of this AI talk, which has got real potential, I'm not anti it at all, but is completely data dependent. That's what AI is, it's data driven systems.
00:18:04
Speaker
Now, if the data isn't reliable, then you're in deep trouble and we're polluting the internet as a whole. So if cities are actually going to be using all of this AI, they're going to need to have a very reliable data set And what could be better and more reliable is a dataset where they are authorizing people to write the history and that that history is unalterable. I think that's really important.
00:18:28
Speaker
Of course, because with AI, it's only as good as the data you're putting in. and And we can't go out there and demonize AI that, oh, AI is bad, but you were the one feeding it bad data in the first place. like we We need to make the distinction between, okay, this is a tech issue, this is a data issue, a people issue.
00:18:47
Speaker
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Blockchain in Future City Systems
00:19:51
Speaker
transportation. Especially for a big city like London or for a huge city, like the numbers you were mentioning.
00:19:57
Speaker
So let's talk about blockchain for for transportation. Could you walk us through what that could look like for a commuter or traveler a decade from now? What could be a potential use case when it comes to and implementing blockchain for transportation?
00:20:10
Speaker
Mm-hmm. Well, um a lot of people would start with payments, and I wouldn't ignore that. But there is an interesting issue about transportation in cities. ah Should transportation be free?
00:20:23
Speaker
but Question mark, right? if i If I could operate a city with free transportation, one might surmise we would do very well. People would love to move there, they would they'd be highly flexible in their jobs because they wouldn't worry about, there would be distance that would be bothering them. So there's interesting bit there about at what point is transportation something that should be fully paid for.
00:20:46
Speaker
And we in London claim, you know, that we do that. We don't actually. I'm over 60, so I don't pay. So we've squeezed this this group of people. Students don't pay. and so you're you're kind of left with sort of an age range of about 40 years, bearing the cost of the whole system. Yeah, but we want the system to pay for itself. Well, you've actually disadvantaged the workers that you claim you're trying to help.
00:21:09
Speaker
So these are political discussions. But blockchain, well, not blockchain, but data, is how you should be making those decisions. so So that you can actually say, well, if we increase it at this age range from 20 to 60, we're going to get people commuting less. If they're commuting less, they're not going to be going to the shops in the center.
00:21:27
Speaker
they're not going to the shops in the center, then we're actually losing money, you idiot. So let's not overcharge them. So you get these sorts of interesting interesting dynamics, which we don't really do.
00:21:39
Speaker
Then we move into areas like congestion charging. So the more data that we have, ah the more power we will have. Now, we could abuse that power. haste that. And I think one of the great ironies of life is that New York City has only just finally put in finally put in congestion charging, despite being the very first city to propose it.
00:22:01
Speaker
So it's ah it's an interesting dynamic there. But data is going to be crucial to solving all of the transportation problems, which are at the moment, if you've ever really dug into them, and i'm I'm not having a go at officers who work very, very hard to do what they can, but they're doing what they can because we're not recording the data at the time.
00:22:20
Speaker
So, you know, a blockchain application would be writing out, again, this all requires discussion on privacy and things, but you would write out your Oyster card details to a public database, not a TFL database, a public database. If you want to set up a coffee shop, you might determine that actually, strangely, most of the people coming to your coffee shop are coming from, I don't know, Maldon.
00:22:42
Speaker
Well, the interesting thing about Molden is that's full of South Koreans. I didn't know that, so maybe what you ought to be doing is you ought to getting some South Korean specialties into your coffee shop. that All that kind of dating information could make cities grotesquely more efficient over transportation if it was more widely shared.
00:23:00
Speaker
We have seen examples. California, 15 to 20 years ago, very open data oriented. That's where we saw many of the very first apps on traffic. and control, but there's a lot more that we could do if the data was much more open.
00:23:16
Speaker
Fantastic. And i think back to our point earlier, when you remember, it's just a database. The use cases are so wide, depending on what you think about, what you need, and what the city and the community needs.
00:23:30
Speaker
and It leads us up to a
Blockchain in Healthcare and Planning
00:23:32
Speaker
lot of cool things. And I think also on this podcast, like we've also mentioned people that are using blockchain for health research and for helping people access healthcare. care So, um,
00:23:43
Speaker
It's so interesting to hear from the city perspective. I think this was something we hadn't mentioned so much. And since we're... Oh, yeah, go ahead. but Well, you're right. it's and we can even take ah We were doing some work two years ago on climate change and energy efficiency in buildings in London.
00:24:02
Speaker
And we were using approximations of certificates. ah you know So you see the ratings from a to E on on building efficiency.
00:24:13
Speaker
Yeah, well, those are one thing, but what was our actual energy consumption? Well, we don't know.
00:24:21
Speaker
Right. and And there's been enough done here in in the UK, building research establishment, cetera, where it turns out that you can put in all the right things.
00:24:32
Speaker
You know, I've got triple glazing, I've got insulation, I've got this, that. And you have an estimated performance. That's what gives you your certificate, is the estimated performance, not what it actually was when you put it all together.
00:24:44
Speaker
And if they all don't quite fit together and there's leaks or something and all that. That doesn't matter because you used all the right equipment. No, it does matter because you're not achieving the goal. And so we would really, really dearly love to have much, much more data on stuff like that. So I could actually say, well, I don't care. I've got a whole bunch of B-rated buildings, but they're performing at E. Why? What's going on here? or that's amazing. I've got all these old structures that shouldn't be able to get even into a C category that seemed to be performing at B levels. Why is that?
00:25:12
Speaker
But we don't have that data. And I feel that this is the great revolution from the bottom up is, you know, free your data. If if you're a community, one one I've always said, you know, a community is a group of people prepared to be indebted to one another. That's actually a fairly strong anthropological definition.
00:25:29
Speaker
one you When you really want to be, a you go to Paris, you meet a whole bunch of Christians, you're not part of their community. It's only when you say, you know what, I want to move to Paris and now I'm going to pay taxes here, and I'm going to get involved, and then you're part of it.
00:25:42
Speaker
Well, one of the definitions I think of bottom-up communities may be we are committed to sharing our data openly with each other for mutual benefit. Oh, that's a cool definition. And just to add to the point of becoming part of a community, it's like, yeah, paying taxes, but also dealing with the bureaucracy and the data. And when I look at it, I'm like, wow, so many systems could be optimized. And it really makes all of this click. Like, oh, it's not just the theory. It's not just crypto, but you could actually be speeding up processes, dealing with visa applications, residency. like i
00:26:18
Speaker
I recently moved to Italy and I was like, oh my goodness, no. like the The bureaucratical part, crazy. scene so it It's all part of a social movement. yeah I'm old time internet you know from the 70s, first on the net in 76 or something. and you know we In those days, we believed the internet would be an unparalleled good. you know As you grow up, you learn that all technology is double-edged.
00:26:41
Speaker
That's the number one of our conversations but back in the late 70s at Harvard. was We had this paradigmical Indian farmer's wife that wouldn't the world be a great place if we could just type and ask some Indian farmer's wife what she thought about a subject that we were discussing.
00:26:56
Speaker
I'm not too sure we ever thought about what the Indian farmer think about us talking to his wife when we were coming from Boston. But anyway, you know, that was kind of it. but But we have this view that it would be a better place.
00:27:09
Speaker
And this is bounded. You know, Berners-Lee, Tim, is you know really keen, been served. They're all keen on open data. The one thing we have found is that open data is a really, really great thing. And I think a lot more communities should be getting the data in the first place, not worrying how to make money out of it, using the data to define their community.
00:27:27
Speaker
And they will become more efficient and more successful by offering open and free data. Open and free data. And you mentioned the Indian farmer's wife. I think that could be like somebody might get the idea and build an AI, or I don't know if it already exists, like the AI agent, and get it to act as an Indian farmer's wife and ask it all of these questions. Who knows? It could be also an application. Well...
00:27:50
Speaker
We're almost out of time. this was This was great. Thank you so much for all of those great examples and also helping us think about blockchain through a different lens, especially something that maybe most of our listeners might not be super familiar with. So huge thanks once once again to Michael Minelli for helping us reimagine also what UrbanEive could look like when local meets ledger. thank Thank you once again for joining us. And to our audience, if you're a regulator, curious owl, policymaker, don't forget that blockchain isn't just finance tech.
00:28:23
Speaker
It can also be civic tech if we build it that way. So we'll keep you posted with our and next episode. And thank you so much for joining us. because Goodbye.
00:28:36
Speaker
We hope you enjoyed our Hootenanny. Thank you for listening.
Conclusion and Further Resources
00:28:39
Speaker
For more hootful and hype-free resources, visit owlexplains.com. There, you will find articles, quizzes, practical explainers, suggested reading materials, and lots more.
00:28:51
Speaker
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