Alex has decades of experience in uniting global communities as an inventor of Voice over Internet Protocol (VoIP), which allows over a billion people around the world to communicate over the Internet for free. He also brings experience founding seven New York-based startups, including GroundLink, Transit Wireless, Elematics and Arbinet, and has invested in over 60 startups.
What brings LendLedger and Celsius together is a vision of the future where the power of a decentralized and open network eliminates the need for intermediaries and unlocks access to capital for the underserved. And we couldn’t be more thrilled to have Alex on board!
We spoke to Alex to learn more about what led him to join the LendLedger team and get his perspective on the blockchain-powered lending space. Here’s what he had to say:
Tell our community a little bit about you and what led you to join the LendLedger team as a new advisor
I’m originally an immigrant from the Ukraine. I’ve been in the US for 30 years and I’ve founded seven startups in the tech space. One of them was Arbinet, which was the first company to do VoIP back in 1994. I took it public in 2004. A few years ago, I got into the blockchain world, and started Celsius Network, which is trying to bring the next 100 million people into crypto.
I’m a big believer that the community needs to support each other, and not compete against each other, and I think helping companies that are in this space and that are trying to solve big problems is the right way forward. After getting to know the LendLedger team, I think it’s one of the better teams out there. Using blockchain and cryptography, they are equipped to actually solve some of these big problems and enable communities to get access to credit.
LendLedger uses blockchain technology to provide equal access to loans to over 250 million underserved small businesses globally. Where do you see the biggest opportunity for LendLedger’s impact?
Nowadays, banks have no reasons to issue risky loans. They are doing extremely well and are more profitable than ever. They do that by taking as little risk as possible. So while community lending used to be about caring for the community, now it’s just about banks being money machines. They’re just focused on maximizing profits. They couldn’t care less about helping society.
We cannot fix that with regulations. We really need to create a separate process that takes money from sources who want to generate returns and gives it to people who want to borrow it because they’re trying to grow their business or improve their lives.
“After getting to know the LendLedger team, I think it’s one of the better teams out there.”
And that’s what you guys are working on.
In your view, what will be the social impact of unlocking small business loans on this scale?
Today insurance companies, family offices, retirement plans, they’re all struggling. Their goals used to be 7–8% returns and they can’t even get to that. They’re struggling to get 3–5% because yields are so low. At the same time, small businesses cannot get a loan. It’s a paradox that really needs to be solved.
Taking the banks out of the middle and stopping them from deciding who gets credit and who doesn’t will open up the economy and enable much more growth because the banks who are supposed to provide liquidity are actually the ones who are starving the small businesses.
Why should the global underserved population care about the crypto space?
If you let the banks make these decisions, the underserved will always be left behind and be taken advantage of. If you create a system for the people, and the system is actually programmed to do everything in the best interest of its users, then the results are going to be very different.
We’re going through this decentralization revolution, in which we’re replacing the banks — the toll collectors, the monopolies — with systems that are acting in our best interest. If the underserved population doesn’t care about that, then they will never rise from the bottom of the pyramid.
“If you create a system for the people, and the system is actually programmed to do everything in the best interest of its users, then the results are going to be very different.”
You recently mentioned that, in your view, the largest crypto players will be bigger than Google or Apple in the next 10 years. Which sector(s) do you believe these crypto players will come from / have the greatest potential to leverage blockchain technology at scale?
Blockchain definitely favors financial solutions. There is a big opportunity to take advantage of this environment, and reinventing finance as we know it. Other areas definitely need innovation as well. Real estate is obviously a great opportunity.
The question is what’s going to take first? What’s going to be the killer app that everybody follows and that sets itself apart? In our view, lending and borrowing is the killer app because almost every person on the planet needs it.
However, the community must grow for it to work. There are about 50 million active users so the crypto community definitely has not done a good job at bringing a massive amount of new people. It’s mostly speculators, anarchists and libertarians, and we’ve now run out of these three segments.
So the key question is who is going to be the next wave of adoption?