Blockchain and Web3 in 2022: Where Are We? (John Bass, Hashed Industries)

It seems that blockchain is one of the buzzwords that got pushed in the background most in health tech. And that’s a good thing, says John Bass - Founder & CEO of Hashed Industries (dba Hashed Health).

Last year, one of the key buzzwords in healthcare was virtual care; in 2020 it was probably telemedicine. In 2019 it was AI, in 2017 and 2018 it was blockchain in interoperability. There are many others of course, and many of these terms are still popular today. Blockchain, not so much, to a degree it got merged into the debates and movement toward web3.

John Bass is an internationally recognized author and speaker on value-based care, blockchain, and decentralized healthcare technology. He is the co-author of the HIMSS-published book “Blockchain in Healthcare: Innovations that Empower Patients, Connect Professionals and Improve Care."

At this year’s HLTH conference in Las Vegas, we caught him for a brief chat about: where is blockchain in 2022, what can we expect in the future, how it relates to web3, and what could NFT - nonfungible tokens do for healthcare.

John, before HLTH 2022, there was a joke on Twitter about what the most common phrases will be heard on stage at HLTH. And then someone said what's not going to be in the vocabulary this year is “this is built on blockchain”. Was the state of blockchain in healthcare in 2022, according to your observation?

I think people have come to realize that's not what's important. It's like talking about the cloud. What's important is that we solve real problems for real companies in today's world. And anytime we talk about blockchain, I think we're distracting our listeners or our customers from the solutions we're trying to deliver to market.

And so blockchain was kind of the hype for a long time, and I think it's rightly faded into the technology stack. And so, for certain types of use cases, I think it's a tool that can be used to solve trust and transparency, and incentive alignment challenges. And, the days of people thinking they were gonna use blockchain to solve everything from soup to nuts are over. And that's a good thing. 

What are some of the actual practical use cases that you see that blockchain is being used for in healthcare in 2022? Because the common critique also in 2017 and 2018 when blockchain was very popular was that the problems addressed with blockchain can be solved with existing solutions in IT. 

Yeah. That's a little bit of a challenging question to answer because part of it depends on how you define blockchain. True blockchains are open source. They're publicly verifiable ledgers, they're forks of Ethereum or things like that. Then there are distributed ledger technologies that borrow certain properties from blockchains but aren't really blockchains. Sometimes they're being used by private networks. So is that a blockchain or not? We have this spectrum or this family of technologies. Sometimes people collapse everything under the word blockchain. 

John Bass.

At Hashed, we're working on seven or eight different startups now. Some use some form of blockchain or distributed ledger technologies. The common thread across everything we do is we bring communities together to solve shared problems and create shared value. And we use community and collaboration as a mechanism for solving problems that drive the cost of healthcare.

There are lots of lots challenges in the healthcare world that no single company can solve by itself. It requires companies to come together and trust each other and align with each other and be transparent with the sharing of information across that network. Where we see opportunities for the technology are in things like the community curation of data, where you've got a bunch of organizations who are trying to solve a problem in supply chain or credentialing, where there's the opportunity to create an exchange of information across that community. And they're all kind of participating in solving a shared problem. For example, professional credential exchange.

We’ve got all of these organizations in healthcare that are all trying to credential clinicians or practitioners, whether it's a physician or any other type of practitioner in the healthcare space. And so each of those organizations is currently independently doing all this primary source verification work every day, usually in the basement of a building, and the hospital down the street is doing the exact same.

They're credentialing the same people, and they're doing work on top of each other. There's a real need to prove the source of that information. The pedigree of that data is really important. You have to prove that it's a primary source-verified artifact. That to us is a good opportunity for this technology. We're excited about NFTs; we're excited about using a kind of tokenization of lots of different things. We're using it to represent a healthcare service, and so a provider can create a digital asset that represents an episode of care, and drop that asset onto an exchange for it to be purchased by a buyer. And because it's a digital asset on a blockchain, we can prove who owns that, and we can be very transparent within the community about who owns that asset at any moment in time.

And so that in both of those use cases, the use of technology uniquely enables a brand-new business model that the world has never seen before. 

I'm really glad that you mentioned NFTs because that's one of the questions that I am wondering is why would you use NFTs in healthcare. You mentioned an episode of care, but to me, that sounds if you really wanted to create NFTs for that, I start thinking about the amount of data that we are already producing in healthcare and just the energy consumption that's required to drive blockchain solutions. If I consider that information would now be translated into NFTs, I see a sustainability problem. So how do you see these discussions? Many discussions about blockchain today are discussions of “this is not good for the environment”. 

Yeah. think that's, fortunately, less of a concern now that Ethereum has moved to proof of stake.

So moving off the proof of work algorithm has been great for the environmental impact of Ethereum. So we're using layer two that's anchored to Ethereum. So the environmental impact is minimal. 

Here at HLTH you had a presentation that was also focused on Web3. There's a lot of confusion around Web3, what it is, how to define it. It's similar to the discussions of “what is blockchain” we heard years ago. And probably a lot of people still wonder about that. What's the most common question you get about Web3, and how do you define it?

 I think people want to know what it is. It is kind of a rebranding of blockchain, and I think it's a better brand. And blockchain needed some rebranding. But it also, when you talk about web3, the definition of blockchain is expanded to include NFTs, DAOs (decentralized autonomous organizations), even Metaverse. And it encompasses this idea of our ability to own things in a digital world. That's at the core of Web3. It's all about the ability to own things online. It's uniquely enabled by blockchain. And it is commonly the things people like to talk about.

This idea of a curator economy or the creator economy is where you've got a version of the internet that's owned and governed by the curators of the information that the information that's flowing across the internet rather than centralized companies who are owning and controlling that digital world.

And the common examples are what if Uber were owned by the drivers or what if Spotify was owned by the artists? That's the vision of Web3 -  taking ownership away from these centralized organizations and giving it back to the curators and the creators who are currently selling themselves for little red hearts and little thumbs. I think that's a really attractive idea for a lot of people. And in healthcare, there's a lot of data that is being curated, but it's being controlled by centralized middlemen.

There are lots of opportunities in web3 for us to embrace these ideas of community ownership and community curation of information, self-sovereign identity, and those types of things. It's an attractive space. There are lots of ideas, but there's honestly very little in the way of real companies who've really leveraged Web3 and done something meaningful with it.

I mentioned the use of NFTs. That is, for a lot of people, that would count as a kind of web3 initiative. We've got some ideas around DAOs, like how you create organizations of physicians or patients who share a common purpose and can support each other socially and perhaps even share a treasury.

And then do things with that money. I think those are interesting concepts for the healthcare space that we're gonna be exploring in 2023. 

So what do you think needs to change so that this would turn into something that's done in reality? Because at the moment, data is held in centralized systems. I have a hard time imagining that you could break the power of centralized organizations. And blockchain is an old idea, so why would it succeed now? Because it failed already in the sense that we didn't see the adoption even when the ICOs and the ideas were very popular and hyped.

You're right, there's a lot of really entrenched interests and there's gonna be a lot of resistance. I think the opportunity is for us to unlock the communities of consumers using web3 technologies and using these web3 technical models and business models.

It would have to be consumers who lead the way. if you look at some of the statistics, web3 is on par with the adoption of the internet.

In fact, the slide I showed in my presentation shows that it's actually outpacing the adoption of the internet. But it's still gonna take some time for these wallets and these kinds of crypto concepts to be widely adopted. And so it's gonna be really hard for the average consumer or a nurse, or a doctor or a cancer patient to be an early adopter outside of small communities of people who are already doing it. So I just think you can't expect these things to happen overnight. This is a long game, and the only path I see to accomplishing what you mentioned is through network effects of consumers adopting the technology and driving those solutions forward. It just hasn't happened yet.