Though cryptocurrency and blockchain technology have gone through rough times over the past years, it has evolved to the point where we see the massive potential of different sectors in our society. Blockchain technology has helped businesses streamline major processes, and cryptocurrency, on the other hand, strengthened financial capabilities.
Now both technological advancements are making its way towards humanitarian and developmental services. UNICEF just recently confirmed its nod of approval in using or making a custom cryptocurrency.
A bold, but smart move by an international organization! This will enable a bigger reach of its efforts to further gain more donations using the digital currency.
No Token Response: UNICEF Is Open to Doing Its Own ICO
So-called token sales or initial coin offerings (ICOs) are getting a nod of approval from an unlikely source.
Revealed in an exclusive interview with CoinDesk, the United Nations Children’s Fund (UNICEF), the U.N. program tasked with providing assistance to children around the globe, said this week it would be open to exploring how it could issue custom cryptocurrencies, either to further its mission or the goals of its partners.
While it might seem surprising that an organization like UNICEF would make such bold claims, it’s actually consistent with the organization’s drive to position itself as a leader in blockchain.
From making its first blockchain investment this year to exploring the creation of an investment fund backed by cryptocurrency, the UN agency has embarked on a widespread effort to utilize the nascent technology.
The co-founder of UNICEF Ventures, Chris Fabian, said the humanitarian and developmental children’s aid organization is open to following the blockchain wherever it leads.
Fabian, who was previously the senior advisor on innovation to the executive office of the U.N. secretary-general, told CoinDesk:
“If we are in a place to look at designing our own token, look at others to help design theirs in a way that we can be a part of, and potentially also have a crypto-denominated investment fund, those would all be things that would be on our roadmap for the near future.”
Far from a passing fancy, Fabian framed this outlook as part of a sophisticated two-prong investment thesis driving UNICEF’s blockchain work.
First, Fabian said the venture capital arm of UNICEF is being run like a traditional investment arm, and therefore, has an obligation to build a profitable portfolio. And second, and perhaps more interesting in how it aligns with the organization’s possible ICO, is the company’s emphasis on learning how to utilize blockchains itself.
Eyes on ethereum
To that end, UNICEF’s work has largely focused on open-source public blockchains like bitcoin and ethereum, the latter of which, through its ERC-20 standard is responsible for the recent influx of ICO tokens. The organization began accepting ethereum donations to its own ethereum address in August as part of a study on smart contracts and has raised about $600-worth of ether at current prices.
UNICEF is now running what Fabian believes is the first public ethereum node managed within the U.N., and this is primarily a mechanism to learn more about the tech.
“We’re using that because we think it’s important for our team to understand [ethereum smart contract language] Solidity and kind of have a sense of what an ERC token looks like, how that would work,” Fabian said.
Under the guidance of their first blockchain lead, Qusai Jouda – who previously designed software for wellness startup Lighter – UNICEF has developed a series of curricula on blockchain generally and ICOs specifically.
Previous classes have focused on what Fabian calls “the less speculative token work that’s being done,” such as the one-off reconnaissance being carried out by the World Bank and U.S. State Department.
But UNICEF’s classes aren’t just for beginners. Rather, they’re primarily designed to explore whether the venture firm could “invest in companies that would provide a crypto return,” thereby providing better liquidity on investments.
ICO or not, UNICEF is already starting to build out a network of blockchain startups to invest in. Last November, the agency invested $99,000 in South Africa-based TrustLab, which is building identity and social development tools with blockchain.
Then, earlier this year, UNICEF became a founding partner in the IXO Foundation, a spin-off of the protocol design part of TrustLab aimed at making the vast amounts of data that could flow through a blockchain more easily measurable.
“If it works as expected,” Fabian said, “we hope that [UNICEF] would have a protocol that we might be able to apply to other parts of our work at UNICEF for monetizing some of the collection of data that we do.”
Currently, UNICEF’s investments are limited to $100,000, though it has raised $12.6 million to invest from limited partners including the governments of Denmark and Finland, and public conglomerates like Disney.
According to Fabian, UNICEF is in the final stages of putting out a call for blockchain startups, and expects to fund as many as 10 of them, bringing the maximum amount invested to over $1 million.
“We believe that a lot of the places where this particular technology can be applied to global scale come out exclusively when you have the public, permissionless blockchains.”