 Sheila Warren is best known for serving as the head of data, blockchain and digital assets at the World Economic Forum. Warren promotes the adoption of blockchain technology and considers herself to be a Bitcoin maximalist. We certainly see a lot in digital currency space, we're seeing NFTs, we're seeing digital assets, crypto art is really exciting to me, but we're also seeing kind of experiments with traceability. In 2020, Warren directed the release of a WEF toolkit aimed at explaining the risks and benefits of CBDCs to global financial authorities. When she's not educating global financial institutions on crypto, she's busy taking care of her three children. This year, she joined our list of the top 100 people in the crypto industry. In this exclusive interview, Warren answers the question, how can blockchain offer a new trust model in an environment where people don't even trust vaccines? Call and post, Cointelegraph's policy editor is the host of today's conversation. And you, our attentive commentators, write your opinions in the comments below this video. And don't forget to like and subscribe. Hi YouTube, I'm Colin Post, I'm your friendly neighborhood policy editor over here at Cointelegraph. Today I'm going to be talking to Sheila Warren, who heads up data blockchain and digital asset policy at the World Economic Forum. Hi Sheila, welcome. Start off with, I wanted to ask about specifics of equity concerns that have come about because of COVID-19. Well, I think we've certainly seen how the brunt of this disease has not been born and equally across the world. Certainly, there's a huge wealth gap in terms of morbidity and mortality statistics that we are well aware of. When it comes time to vaccination rollout, we're seeing a huge divide in terms of which countries, jurisdictions, and even within which people in the societies of where vaccines are being deployed, what does that access look like and what does that mean for kind of our global priorities? I think that we're seeing a lot of unrest. We know we certainly, we had a summer in the United States this year that was really about a Black Lives Matter and a lot of other movements that we're highlighting some of the inequities, again, that economic justice and racial justice that this pandemic highlighted and spotlighted workforce issues. Not everyone can work virtually. Not everyone has the capacity, whether it's in terms of internet access, digital divide issues, or whether it's just in term of the reality of their work day. Not everyone is in a situation where they can work from home or where remote work is even vaguely a possibility and so what does that mean in terms of how we're stratifying our society and who we are obligating essentially in order to make a living to expose themselves to this virus. So a lot of these topics that we always knew about have become top of mind and then pandemic really has exposed some of these problems and cracks and fissures in our society in a way that I certainly hope is impossible for us to continue to ignore. All right. And then obviously the follow up question is how does blockchain policy connect to these issues and any potential solutions? Yeah, well, I think a lot of what we talk about in the blockchain space is decentralized governance and what is really exciting about protocol and what's exciting about a shared ledger really is the governance model underlying it or one of the most exciting things about that and what that allows. And so when you think about a more peer to peer model, OK, that's one thing when you're talking about currencies and certainly those become sort of the use cases there become kind of immediately obvious or somewhat being deployed already in terms of efficiency and other kinds of things. But what I think we don't talk about as much or make as much of a connection to other topics is really these questions around governance, governance questions and how how do you engender trust in a system where trust has been broken? So I think that we're seeing right now, you know, I even think that the vaccine has a tendency that you're seeing around COVID-19 vaccinations. People are simultaneously terrified of dying of the virus and terrified of side effects of the vaccine or they don't trust it or they think it's got a microchip in it or you know, whatever it is, there's an erosion of truth and erosion of fact in our society and I mean that globally. And how do we rebuild that trust? Well, I think that blockchain by nature, by its very nature is offering us a new model of trust. It's allowing us to trust in a system that doesn't require us to rely on a centralized party to our retreat or adjudicate what is true. And I think that's really important. And it's something that I think is becoming more and more top of mind in some of these conversations around our systems, including our public health system, but also transportation and media and other kinds of things as well. So what have you seen over the course of the past year as the most tangible success stories in adoption and applying blockchain to solve these equity concerns? Yeah, well, there's a lot. I mean, certainly we see a lot in the digital currency space. You know, we're seeing NFTs. We're seeing digital assets. Crypto art is really exciting to me. But we're also seeing, you know, kind of experiments with traceability. So our mining and metals community does have an initiative where they're looking at carbon tracing. They're trying to kind of figure out, you know, how do we control emissions? How do we focus on climate? And they all got together. This actually sparked from a conversation that I led last year, last year in Davos with some of these executives, educating them about kind of what blockchain was, and they spent some solid, really solid time, you know, learning and educating themselves and their teams about what the technology could or couldn't offer and then decided they wanted to explore some of this in the carbon tracing context. And so kind of understanding, you know, how do we as an industry, as an industry that is pretty, you know, carbon heavy? How do we get towards neutrality? How do we get to net zero? Kind of what to do that is to make sure that we are having an effective real-time ability to track and to understand, you know, what the source of some of the problem is. So I think there's things like that that I'm excited about that, you know, it brings to be seen exactly what those look like as they roll out. But I do think that there's opportunity for us to think a lot, you know, about what could enhance sort of traceability and transparency in a system, what could that information enable us to do? You know, now I say a lot, and I've actually said to Quinn Telegraph before, you know, transparency is a goal in and of itself is not. I find that to be to immature. You have to understand like what is transparent to whom and what is the goal, what is it you're trying to visualize and what are you going to do with that information, right? Just making something transparent. I mean, we call that in the law, you know, a data dump, right? I could like make everything about my life transparent to you, but you can't you can't separate the wheat from the chaff. You can't separate signal from noise. What's important is that we are able to isolate what actually are important factors and do something about them to correct or to course correct or change or whatever it might be and to create levers that we can actually improve the situation. It's not enough to just say, well, now you can see it and that's the end game. There has to be a follow up mechanism there. And so with this, they are aiming for, you know, basically net zero, which is an important goal of the forum and of many of our constituents and many governments around the world. And I would argue even becoming one of the Biden administration, the administration of the United States. But how do you do that? Well, you need information, you know what I mean? So information can lead to accountability and accountability can lead to change. And so that is where I think we should shift our focus in terms of this transparency component or the traceability component of a blockchain vast system and think about what it is actually enabling us as a system, you know, to do and to do better. Well, if you take transparency as your fundamental guiding principle, eventually you end up running into privacy concerns because, you know, you've done the data dump on every individual. So you also want to protect what you know about a person and what you don't want to reveal. Yeah, I think that's it's that's funny, because that's one of the things that happened this year is I took over our data work. And, you know, there's privacy is a very cultural norm. You know, I mean, different cultures define privacy very differently. Different cultures of different expectations are on privacy. Certainly what we are looking to do when we say we're protecting privacy is we're trying to protect people from exploitation or trying to affect people from having information that they prefer to keep, you know, quiet to themselves. There's personal choice, but there's also that we're trying to limit the ability of a centralized body of whatever that might be, whether it's a government, whether it's a business, and to exploit that data or to use that data for ways that are not desirable by the individual. But we also want to make sure that we're individuals are quite comfortable with, you know, with with a different notion of privacy because that's going to vary. It's very context dependent that we are also enabling people to participate in the data economy and the way that they so choose. So there's an element, I think, where we need to we need to guard against being strictly top down in terms of our, you know, sort of control of a system and saying that absolute privacy is always the end point. And to say that really there needs to be an element of choice and we need to actually have and empower people to understand what's happening with their data, but really understand not this kind of like 100 page notice that you need a lot of agree like I have and even like a privacy, you know, focus to even a comprehend what is being asked of you before you can consent to it. It's what are our defaults? It's how are we thinking about to me that it really comes down to agency and empowerment more than anything else. And so I would I would prefer to shift the conversation away from privacy really towards agency and empowerment. And that starts with a fundamental notion that you are defaulting, right, to privacy. But it is really a little more of an interesting conversation in my mind because what you're talking about is that people are able to engage their economy in a way that makes sense to them and that they can change their minds or they can change their minds dependent upon the context. All right. So one area of the WF's policies that I would be, you know, remiss if I didn't get to would be central bank digital currencies. Everybody's been talking about them, especially over the past year. It looks like China is on the threshold of actually launching one. But what are the sorts of risks and opportunities that all the WF are looking at regarding CBDCs and what are some of the things that you specifically are looking out for? Sure. So last year in Davos, you know, we released our central bank digital currency policymakers toolkit and then we announced we're going to create a digital currency governance consortium. That work is well underway and we actually released a couple of days ago our initial vision for the digital currency governance consortium. It's a concept note that's going to be built out over the course of the next, you know, four to six months. Let's say we're getting into detailed recommendations and interventions and things like this in the digital currency space. And this is kind of wide ranging. It's got everything from kind of aid and development, you know, to financial inclusion, you know, regulation, like a whole bunch of different kind of areas and it's available for anyone to kind of take a look at. I think it's important to look at CBDCs as part of the financial system. So there is I think that I still think there's this kind of like concept in our in our in our language around this that it's like CBDC or crypto or stablecoin or, you know, Bitcoin or and I would argue it's like all of these things, all of these things are going to become or already are in some ways, you know, a part of our financial ecosystem. They're going to continue to be so they are fit for different purpose. And so for us to say that a CBDC is not a crypto, therefore it's useless, it makes no sense. Similarly to say, you know, everything has to be like a CBDC or it's dangerous and horrible, it makes no sense. Like these are different things and they have different design elements in them very deliberately. And so to me, what's the most exciting across the spectrum of all of this is the programmability of money, right? And so thinking about how we could actually program money in a way that could be quite valuable, you could think about the CBDC context in terms of, you know, taxation, taxation deliverance and just because of one narrow example in crypto. It certainly has engendered things, you know, like DeFi and new capital market creation, things like this. There's all these different things that can be done, but we shouldn't be we shouldn't sneeze at something just because it has a particular orientation. All these experiments and we're still in a phase. Let me be really honest with you. I mean, in my view, where all these experiments are valuable because we are still pretty early in all of this stuff. You know, as much as we feel like we watch price indexes and things like that, and we think, oh, we've come so far. You know, we're still really, really early in experimentation with all these things. So in my mind, I very much welcome and celebrate the fact that there are all these different kinds of things happening around the world and that the approaches to CBDC is whether they're technically CBDCs are kind of more, you know, digital digital money. I think are more like a stable coin. I think are really exciting. You know, we should kind of be looking at all these different things and look at the sort of orientation of the institution in some cases that is launching something and say, what are they learning? What are we learning about what they care about? What are we learning about how governments think about money? What are we learning? All these different things are really, really interesting if we just take a step back and stop being so competitive within the ecosystem and say, well, that's terrible. And this is the only way and that thing is the same as the other and all that kind of thing. Now, what I worry about is that, you know, within the ecosystem, we're just going to wind up recreating exactly what we have. And certainly, we see a lot of innovation in the financial services industry is a general matter, right? A tremendous amount of very exciting innovation. But I also think we have opportunity to kind of think really, really outside that box and very creatively about money. I would like to return to this this notion that you mentioned in the middle of what you said there, this idea that we might be recreating what we already have with new technology. So a lot of the conversation in the US focused on these $1,200 payments that we could not get out to people nearly as quickly as we would have imagined we'd be capable to, given the technological backing we thought we had. The second time around seemed to be a little bit more successful. But that was also that was really when people realized that we are not as good at this as we would like to be. What are concerns that you would look out for for central banks issuing digital currencies so that they would not just be replicating the same sort of inequities in bank access that we already have with our existing system? Yeah, I mean, I think, well, that's an interesting question because you're kind of getting at the last part of your question into kind of like a wholesale versus retail sort of model. Right. And so I think I don't think that's quite where you what you what you're what you're meaning. But I'll just kind of point that out. I think these are very different things. I think that as a general matter, you know, it comes down to kind of what are the goals, right? Like, what are the goals of any CBDC issuance? And so if you're really focusing on the use case you talked about, which is we had stimulus payments, there was a premise on a fraud in that system, you know, we couldn't get them in the hands of people at all, let alone the timely manner, you know, there were a lot of intermediary middlemen that cut out a lot of that value because of like check cashing or whatever it might be, right? Like all of those things that have been embedded in inequality in our financial system for a very long time, they're not new for COVID. COVID just kind of made them more acute because the money was really critical to people to like get food on the table, you know, or pay rent or whatever it was. So first of all, I'd argue that's part of a broader system and we won't go down that road hole, but you know, is it better to get cash to pay your rent or to have an eviction moratorium? You know what I mean? Like these are the broader policy questions around response to COVID-19 that we'll just put aside for the moment, but assuming that you decided stimulus payment is the way to go and that that needs to be handled very, very quickly, which I agree with. I think that you have to look at like what are the design choices that you're gonna make there? Like are you dealing with people that are gonna have digital wallets? Are you dealing with people that have traditional bank accounts because certainly, you know, we had a lot of people that when you get your, if you get your tax return, kind of like digitally, you know, whooshed into your bank account, which a lot of people do now, you know, in many parts of the world, like that's not a really big issue because you get your stimulus payments similarly, but a lot of those people aren't the ones who got stimulus payments. The people who use stimulus payments are people that were out of the banking system that were getting paper checks and they had to go to check action places and get them cashed. So what does it mean in terms of adoption for people? And so that's where I think you get into things like devices. Like are you actually enabling digital wallets on your smartphone, right? Like are you realizing that people might be using payment apps that aren't necessarily tied to back-end banks? Are you like all these, like are you issuing a debit card that they can kind of like use, you know, through like a, you know, totally blanking on the word, but you know, that they can just kind of go and tap and do a tap payment, right? Like in a store or whatever it is. Like what is the mechanism that you're gonna be releasing this? And so I think that some of the early thinking was just get cash out, get cash out, get cash out without really thinking about the mechanism to make that cash usable by people and to make it usable without cutting out a giant swath of it through intermediaries or other functions that we're gonna, you know, eradicate some of the value, like literally take away some of the value through fees. So it's a broader, I think orientation to how people are really paying for things. How, and again, this is very cultural, right? In the United States, we still use a lot of paper cash in other societies, nobody uses paper cash. Doesn't matter who you are, everything is done through your mobile device, right? Like all of your accounts run through there. And whether that's tied in the back into a bank account or not is complicated, particularly if you're talking about a central bank issued, you know, form of money, but it's easier if you recognize that that's the mechanism, that everyone is using a device and like what that, so who are you partnering with as a central bank? Like how are you thinking about payment services? Like all these things become very different depending on where you are in the world and what population you're trying to serve. So that's a long-winded way of saying, you know, I think when it comes down to it, the issues around financial inclusion are much bigger than who's issuing the money. Is it Fiatback, CBDC or Bitcoin or crypto or whatever it is, right? Like there are a lot more issues around financial inclusion. And this is a very well-documented, you know, well-researched area. And so I think that we have to put some of these conversations into context. We can't just say, oh, we're gonna be able to push money out through an app and that's necessarily gonna get everybody what they need. We have to say, okay, what is happening in this society? What are the reasons that people, all of these different kinds of questions that come into play? Internet access comes into play. All these things become critical, you know? And that's where I think a lot of the, I think we're gonna see a lot of like the failures, you know, around some of these experiments is because the people designing them aren't necessarily able to, because of the speed that they have to roll out these solutions, able to take into consideration all these other systemic issues, infrastructure issues that are hugely problematic and are major, major barriers to people engaging in any formal financial system. Back when people were introducing initial legislation in March, April to try to deal with COVID, there was mention of Fed accounts, right? They were trying to make sure that everybody in the US could access money directly from the Fed and they would be able to do so through the post office, rather than having to depend on, you know, banks being everywhere, which they obviously aren't. The bill that ultimately passed did not include that provision, but are these things that you are optimistic about CBDCs addressing? I mean, are these inequities that you would think that CBDCs as a development would be able to address? Or do you think that this needs to be a broader policy issue before CBDCs can come in and do what they promise to do? It's always the latter, right? Like I don't think any form of money or technology backed solution can solve these problems without accompanying policies. It's about the broader context. So what you've heard me say this entire time we've been talking is you have to ground things in context. Like it's just really, really important. And so part of what we focus on is what's the accompanying policy? What are the other things that are happening in any particular environment that are making it impossible for people to actually deploy a technological innovation in a way that can be very powerful, right? And those limitations often are not about the tech itself. That's not the issue. It's just the accompanying environment. It's the enabling environment around it. So to your point, right? Like you're in bank deserts, let's call them, probably isn't a word, but like there's food deserts, right? There's like banking services deserts. Certainly we know that there are parts of the population and this is rural, whatever it might be, there just is not access to banking services. You have to do it online or whatever. So post offices are an example of a place, well, where because of the mandate of the post office, they go everywhere, right? Like that's part of the deal of the post office. It's part of the requirement. That's why last mile service is often happening through big shipping providers or big UPSs and FedExs. Last mile is often through the postal service because the postal service is required, you know, basically through regulation and other things to provide service to every citizen and every resident in the United States. So when you think about that, yeah, there's an example of kind of creative thinking that didn't pass, you know, but again, the game's not up, game's not over, right? Like we're just in a new inning. So, you know, how do you access people? How do you meet people where they are? How do you ensure that you're creating a user experience that's not just a technical user experience, it's kind of like a life user experience. It's acknowledging people's realities and saying like, who is it we most need to get things like a stimulus payment? It's not me, you know, it's not a lot of people that are in my neighborhood, but let me tell you, it's a lot of other people in my neighborhood, I live in San Francisco, right? So there are an awful lot of people that live right in my neighborhood that are the ones that need access to these payments more than I do because I have a home, you know, because I have a job and for a variety of other reasons, right? So how are we thinking about who we're trying to help here and how are we making sure that while we roll out a solution that's kind of 80-20, we're not leaving the 20 behind because that's I think what we saw happen in the first round of payments as you mentioned, right? And that led to a whole host of other issues and problems that were really, really challenging. So this is the stuff that I think it's really, really hard, you know, and there's a tendency, I think, in a lot of, well, it's not just tech, a tendency kind of in life, you know, to sort of ignore last mile. But what you'll hear from a lot of people who are really thinking about this, including the sessions that we had on digital currencies, you know, here at the Davos agenda, we had two different sessions of digital currencies and in each one there was discussion about last mile and how you actually think about standards of living for people that don't have access to the financial system or to certain kinds of technology or that have very spotty, you know, internet access, like all these kinds of things that kind of come into play to make their life UX very, very complicated. I like how you phrased that, life UX, that might be a very big one in San Francisco, but that's a new one to me. Yeah, I just made that up. I kind of like it. I'm gonna like, I'm gonna refine that a bit, but I really like it, you know? That's kind of what it's about, right? Like you can't just think about, like we think so much about the technical design and that's of course really important, don't get me wrong, but you have to contextualize that in someone's life. Like I'm a really busy parent of three kids. I'm running around like crazy. My life experience, right? Like what I can do with it, like I think about this with it with, you know, the clubhouse app and there's this kind of running joke that clubhouse is really mostly for like single people during a pandemic or kind of sitting around a lot of time. I don't have that time. I'm on clubhouse. I am like changing a diaper or I'm like making dinner for my family or I'm like, whatever it is. I'm always doing something else, right? Like I'm driving to the drug store to get like band-aids cause my kid got it, whatever, right? Like they need the frozen band-aids or the old band-aids or what, you know? There's like a whole other life experience that's going on and you kind of have to think about the reality of what you're designed. So that's kind of one very narrow example with an app that I was kind of joking about the friend earlier today, but it's really more, how are you meeting people where they are? How are you accommodating very, very different life experiences and what is the goal in focus? And so it's something like a stimulus payment. That's a particular set of people, right? You're not building for like every single person. You're building kind of like to say, how are we getting money to the hands of people that need it to literally survive? That will literally be out of their homes, start, you know, not hung growing, hungry, cold, can't pay their heating bill, forget paying their mobile phone bill. Like don't have the money to do those things, right? Like how are you going to be accommodating that in a time of pandemic when you don't want people out on the streets, roaming around, waiting in long lines, you know, because you're spreading a disease? Now, who saw that coming? You know, obviously just like an unprecedented situation. So I don't mean like, why weren't we planning for a massive pandemic? Although I would also say, why weren't we planning for a massive pandemic? You know, that is very true as well. But you have to kind of be, we now have the benefit of experience and the reality is these problems aren't going away and they were always here. It's just the pandemic made them acute, but they were always acute for part of the population. There is a tremendous amount of people in the world who live paycheck to paycheck and that paycheck is in danger of being a vanishing. And then what do you do? Like how do you get them their unemployment, you know, insurance payments or whatever it is? These are really complicated questions and it behooves us as a society to kind of think about them, you know, more systemically both in terms of policy interventions and solutions, but also in terms of the design and the life UX, you know, that people are bringing to the table. Thank you very much for your time, Sheila. It's been great. Oh, well, it's my pleasure. Yeah, thanks so much. And thank you all for watching. I'm Colin Post, policy editor here at Cointelegraph and we've been speaking with Sheila Warren of the WEF. If you enjoyed the video, please hit the like button and subscribe to Cointelegraph's channel. Thanks y'all.