A week ago today, 20 November 2019, a highly interesting blog post appeared on the Medium platform. The article was written by the European Investment Fund (EIF) and bears the self-explanatory title “Why do we need to support blockchain and AI in Europe?
The article itself contains a traveling plea for strengthening financial support for future technologies. At the same time, the EU announces an investment offensive of 400 million for the coming year and a further billion from 2021 as part of the InvestEU programme.
Competition from USA and China puts EU under pressure
Let’s start with the good news. The European Union and the EIF recognise Blockchain as a central issue for the future. The report states that ‘it is clear that technologies such as Blockchain and Artificial Intelligence will change our lives’. The relevance is already clear from the fact that this is the opening sentence of the article itself.
The article then reflects on the current state of European development for new technologies. For example, it says that from Maastricht to Berlin to Tallinn, the brightest minds are already creating innovations that will change ‘everything’: From medical technology and defence to the way we store information.
The report also gives concrete figures. This year, for example, the European Union is investing more money in blockchain than China, for example, but still less than the USA. So far, so good.
Nevertheless, the article then reveals the weakness of the current investment policy. The money is mainly used for basic research and the preparation of proof-of-concepts (PoC). In short: Figuratively speaking, we help the child learn how to walk, but we don’t show him how to sprint. And this is precisely where the future challenge lies, which is also recognised as such in the report.
Company founders and start-ups who want to be successful with their business and therefore also need growth migrate to other countries such as the USA or the Asian continent. This is not only a transfer of knowledge. From a European perspective, the fact that the associated job opportunities and the economic upswing in other countries are being exploited is particularly problematic. So what can the EIF do?
Targeted investments in blockchain should improve promotion
Together with the European Commission and the InvestEU programme, the European Investment Fund will now provide funding for the next 100 million euros. The money will be used for venture capital funds, which in turn will invest in AI and blockchain-focused companies. The EIF calls these initial investments ‘cornerstones’ and expects an additional 300 million euros from private investors.
From 2021, this investment scheme will also give development banks the opportunity to participate. The European Union hopes that this will lead to a further significant increase in capital, especially at the national level. It is also stated that the current subsidy amounts are only a beginning. Both the EU and the EIF are aware that the current amounts are insufficient and will have to be significantly increased in the future. Nevertheless, the current step is a clear commitment to the future technologies of Blockchain and AI.
At the end of the article, what many people (especially here in Germany) and also at the European level miss comes to the fore: the courage to think big and to have visions. That’s what they say:
“Imagine a world in which we can reduce waste in supply chains, trim costs and increase efficiency – thanks to the transparent nature of the blockchain. AI and blockchain can only change lives if they are commercialized and used. We look forward to implementing this!”
The EU and the European Investment Fund are planning an investment package in future technologies such as AI and Blockchain. Next year 400 million euros and from 2021 up to 2 billion euros. What do you think about these figures? Can the EU become a pioneer for blockchain?