The Nordic Blockchain Industry

An Outsider’s View

WEB 3.0 is a possible future version of the internet based on public blockchains, a record-keeping system best known for facilitating cryptocurrency transactions. This prospect of eliminating a central authority has garnered interest even in Nordic countries, where the establishment typically has a higher level of trust. Ask yourselves if any other generation of hackers could dream of eliminating state-owned institutions. I can think of one such incident from our recent past that kicked off with the same promise.

Today marks the 30th anniversary of the World Wide Web being made public to the world for the first time on April 30, 1993. The European Organization for Nuclear Research (CERN) made this historical moment possible. I was born in the same year in the southern city of Hyderabad, India. I would have laughed if you had told me that I would be studying the details of the Nordic blockchain industry even a year ago.

Why am I interested in the Nordic blockchain industry?

I had no intention of moving to Scandinavia until COVID struck. I moved here in 2021 to accompany my partner, who is a permanent Danish resident. My inability to speak Danish has effectively forced me into a career break at the moment. To keep sharp, I started looking for volunteer opportunities, and the Nordic Blockchain Association was hiring. Before getting into the meat of my argument, I’d like to introduce some basics.

Let’s begin,

1. Who makes up the Nordic countries?

The Nordic Region is defined by the Nordic Council of Ministers as Denmark, Norway, Sweden, Finland, and Iceland, as well as the Faroe Islands, Greenland, and Åland. Here are some salient features of the Nordic region:

  • The region’s current population of 27.7 million in 2021 is expected to grow by 6.6% to approximately 29.5 million by 2040. Greenland is the only Nordic country where the population is expected to decline.
  • The ratio of old to young people in the Nordic region is increasing. Current forecasts indicate that 8.6% of the total Nordic population in 2040 will be 80 or older.
  • The dependency burden—or elderly burden—is expected to increase in all of the Nordic countries.
  • As of January 1, 2017, Åland and Norway had the largest percentage of citizens from other countries, with 10.6% of the population, followed by Iceland at 8.9%, Sweden at 8.5%, and Denmark at 8.4%. At the other end of the scale is Finland at 4.4%, the Faroe Islands at 2.9%, and Greenland at 1.8%.

All the above data has been taken from an article published on the Nordic Council of Ministers’ website.

2. What is a blockchain?

Here is how a partner at Deloitte, Switzerland, described the original intention of blockchain in 100 words:

“You (a “node”) have a file of transactions on your computer (a “ledger”). Two government accountants (let’s call them “miners”) have the same file on theirs (so it’s “distributed”). As you make a transaction, your computer sends an email to each accountant to inform them.
Each accountant rushes to be the first to check whether you can afford it (and be paid their salary in “Bitcoins”). The first to check and validate hits “REPLY ALL”, attaching their logic for verifying the transaction (“proof of work”). If the other accountant agrees, everyone updates their file…
This concept is enabled by “blockchain” technology.” Richard Bradley

“Blockchain is a distributed ledger technology (DLT) arising from the world of Bitcoin and cryptocurrencies which has been advocated as a disruptive and revolutionary innovation." Silvia Semenzin (Head of Research and Advocacy at the CRO Cyber Rights Organization, Netherlands)Disruptive and revolutionary. I have heard technology described in this way before. Wasn’t the internet promising a revolution? I was born the same year, and the internet has been reduced to establishing tech monopolies. The internet promised to empower the masses, narrow economic disparity, and democratize knowledge collection.The internet, in fact, is a deeply centralized and hierarchic space, colonized by economic and political actors who own the means for producing, collecting, and analyzing digital data, which today is popularly considered "the new gold" or "the oil of this century," as reported in The Economist, 2017.

So, did the new communications protocol, Transfer Control Protocol/Internet Protocol (TCP/IP), a.k.a. the Internet, deliver on its promise? Let me know your thoughts in the comments. You can also read: Whatever Happened to the Internet’s Promise? by Simone Ross

3. What is it like to navigate this industry?

The World Economic Forum expects at least 10% of global GDP to be stored on blockchain platforms by the year 2025. In the year 2021, the global GDP was 96.53 trillion USD. Therefore, blockchain platforms are expected to contribute at least 10 trillion USD by 2025, which is a significant amount for an industry that is relatively niche and limited to a handful of cities in the world.

Information on the Nordic blockchain industry’s size, value, and limitations is difficult to find. What I do know is the existence of a Danish blockchain industry cluster.

An industry cluster is a collection of firms and related stakeholders that gain productive advantages from operating nearby. The presence of a cluster translates into deeper labour pools to hire from, better access to customers and suppliers, and an exchange of knowledge. These industry clusters improve the competitiveness of a nation or a region.

Clusters allow members to operate with higher productivity by improving supply lines, skills, and access to specialized information, technology, and dedicated institutions. Most importantly, a well-rounded cluster would stimulate innovation and the creation of new businesses.

As mentioned above, finding exact numbers and details on the Nordic blockchain industry was difficult. However, in a joint report published by the European Blockchain Center at the IT University of Copenhagen, the Fraunhofer Institute for Industrial Engineering, the Confederation of Danish Industry, Statistics Denmark, and the Danish Industry Foundation, the Danish Blockchain Cluster has been classified into 3 main sectors:

  • FinTech
  • Professional Services, IT
  • Maritime shipping and transportation

Now, you might wonder if it is necessary to invest your time in understanding the blockchain industry, Web3.0 world

Irrespective of where you stand on the rise of cryptocurrencies, blockchain, or any advancement in technology, a general understanding of how things operate is essential to raising the level of debate. Otherwise, technocrats will continue to sit in public hearings wondering why the system has such a hard time grasping even the most basic concepts. I had to add this section at the last moment after I heard comedian Roy Wood Jr’s speech at the White House Correspondents Dinner, 2023, this morning.

He explains the concept of NFTs in a room filled with the most influential media personnel in the country. But more importantly, he draws attention to the importance of the "local reporter” in raising the level of awareness, speeding the upward mobility of minorities, and raising the level of discourse. Here is a line from the speech that stuck with me:

“They record history in real-time.”
— Roy Wood, Jr. at the 2023 White House Correspondents’ Dinner.

Is it possible to create more inclusive, cooperative, sustainable, and ethical digital and physical spaces in the Nordics? The answer is not simple. There is no universal definition of a blockchain, which creates room for myths and narratives. Silvia Semenzin deploys the Foucaultian concept of “regimes of truth” (Foucault, 1980) to address this issue in her doctoral dissertation. She states that “the urge for a data justice and human-rights approach to data and algorithms is one of the biggest challenges of our times of crisis.”

You can also read and download Silvia’s doctoral dissertation, titled: Blockchain & Data Justice, the political culture of Technology, University of Milan

In the next article, I will be looking deeper into the application of distributed ledger technology in the Nordic region of Denmark. The financial application of cryptocurrency remains the most popular even in this region, but the intention is to look outward and study the exciting work being done outside the finance industry.