CryptoSlate recently held an exclusive interview with Pat Larsen, the Chief Executive Officer and co-founder of ZenLedger.io—a leading cryptocurrency tax software company. He shared his valuable perspectives on Web 3.0, data privacy, crypto-economics, and how Fortune 50 corporations are positioning themselves for blockchain adoption.
Pat Larsen studied material science chemistry at the United States Air Force Academy and earned an MBA from the University of Chicago Booth School of Business. He is a former US Navy surface warfare officer and has worked with organizations including Blackstone, Vets in Tech, and China Phoenix.
In June 2017, Larsen, together with Kevin Starbuck and Charles Nordstrom, established the crypto tax platform ZenLedger, which enables cryptocurrency investors to more efficiently manage their tax obligations.
When questioned about his expectations for Web 3.0, Larsen expressed his belief that achieving "greater user control over data and assets" will continue to be a driving force.
He maintains that rather than surrendering data to third parties, individuals should retain ownership of their personal information. In his view, nothing should prevent people from having authority over sensitive data since they are already accustomed to "controlling their social security numbers, bank account details, home addresses, physical location of activity and electronic devices, login credentials and passwords."
Larsen also anticipates the development of faster, more affordable, and improved algorithms that will facilitate higher-quality data analysis. These algorithms will translate into more apparent and easily accessible benefits regarding data privacy.
Larsen also emphasized that the verification of online content is an essential component of the economy. According to him:
"People want to believe that content on the internet is free, but clearly it's not. You must pay for your internet connection, your hardware infrastructure, your devices, and then you must subject yourself to advertisements or data harvesting."
However, there should be a solution that can balance data privacy and verification. More specifically, he mentioned the Basic Attention Token (BAT). While somewhat centralized, in his opinion, it is a "powerful tool" that enables individuals to be compensated for their time and attention.
According to Larsen, this represents an improvement over the current system which rewards services capable of (often non-consensually) selling people's attention.
Regarding crypto token economies, Pat Larsen believes the "future is already here" since people are already comfortable with digital money. According to the ZenLedger CEO, it's a question of "where this will happen and for whom?"
He pointed to Venezuela and Argentina as regions where the adoption and utilization of cryptocurrency and blockchain technology could be faster, more impactful, and without "interference from established interests":
"In the upcoming global economic downturn (because we are due for one) it will be critical to see if crypto correlates with other speculative assets—paper sold off so people can pay for food and shelter in their local fiat currency—or if there will be a flight to an asset that doesn't inflate when central banks need to engage in massive asset purchases again."
Furthermore, the CEO is not alone in his desire to observe how crypto assets will correlate with more traditional assets, especially in the context of a global financial crisis.
Some experts have suggested there is minimal correlation between the crypto markets and other traditional markets. Research conducted by CryptoSlate also points to this conclusion, finding that Bitcoin and the S&P 500 are historically uncorrelated. Another point to note, the relatively small size of the crypto market (compared to traditional assets) means it is unlikely to have a significant impact on other markets.
According to Larsen, unlike the internet in the 1990s, blockchain is something that major corporations are predicting will be a transformative force in the digital landscape:
"I believe things are likely to be more centralized in the foreseeable future. Blockchain is not going to catch anyone by surprise like the Internet did in 1995. All the Fortune 50 companies see this coming and are actively taking steps to prepare and benefit from blockchain."
Consequently, Larsen anticipates the emergence of more centralized blockchain platforms in the future. According to him, centralized blockchain platforms—such as those from Facebook and JP Morgan—will encourage more mainstream investment into the sector. His reasoning: large corporations have the resources to hire the best talent and the capacity to drive innovation.
The interview concluded with Mr. Larsen's views on the most important use cases of blockchain technology. Whether centralized or decentralized, the CEO considers control of personal data, verification of supply chains, and voting as some of the most significant applications of blockchains. Payments and money transfers with low transaction costs also ranked high on his list of top blockchain uses.
