Decentralized Insurance: A Conversation With BlockApps’ Mark Caraway

The following is an interview we recently had with Mark Caraway, Head of Partnerships, BlockApps.

What's your background? How did you get involved in crypto/blockchain?

MC: I moved to San Francisco after getting my Bachelors and MBA in Finance seeking a career in Finance. I ended up becoming a Finance recruiter for 7 years working for insurance, fintech, and  banking industries just as the original Fintech and P2P lending industry was starting in the Bay Area. 

I had the experience of staffing major bank and payment firms in response to intense new regulation, staffing payment and technology companies' first loan and credit analysts as they were transitioning from tech to financial firms, and staffing traditional industry operations staff.  

I realized that a lot of the work my team was supporting was extremely manual such as data entry/movement, reconciliations, and verifying someone else’s verification of an event happening.  

As crypto became more popular I helped oversee Coinbase’s hiring of its original compliance team and realized that crypto was now officially here to stay.  

I was lucky enough to meet with the BlockApps team when they were at Google Next announcing their partnership as Google Cloud’s first blockchain partner in 2018.  The more I learned about Blockchain technology I realized that it is the fundamental technology of the future of business.  Later that year I joined BlockApps to oversee our Financial Industry vertical and our key partnerships.  

What value does your company bring to users? 

MC: BlockApps provides the enterprise-grade Ethereum-based platform (STRATO) for decentralized communities to build blockchain solutions.

It provides a secure, scalable means to build DeFi apps without dependence on cryptocurrency or unrelated projects.

So the value we provide to true “end users” is in simplifying the process for blockchain networks. For example, in financial projects like Minuteman Capital, BlockApps STRATO is used because it is easier to both build and scale decentralized applications. 

In this case, Minuteman Capital was able to take advantage of a powerful combination of affordable scale and advanced privacy to create a network for investors and individual participants very quickly, and include them in the same financial system as large corporations and mega investors - democratizing capitalism.

Where do you see your company five years from now? 

MC: In 5 years I expect to see BlockApps become a household name as a trusted, neutral data custodian for all major business functions - finance, HR, accounting, product, and even engineering. I think of us as the “Intel inside” for blockchain networks. 

Within the insurance industry specifically we will be highly involved with insurance settlements, compliance and operation automation, transparency, and be the key tool for advanced analytics Machine Learning and AI capabilities to leverage the blockchain data for insights and forecasts.

What are the most common misconceptions you hear about decentralized insurance? 

MC: The first misconception is that decentralized insurance will magically fix all of the inherent issues in insurance.  It won’t, and it certainly won’t happen overnight.

Second that it will eliminate the need for major insurance institutions.  There will still be a need for commercial support and accountability related to major issues.  

The third is that pooling risk is always a benefit. This actually creates the potential for system risk such that we saw with Mortgage Backed Securities in 2008.  

What's next for decentralized insurance in 2021?  

MC: We’re going to see a digitization of almost every type of insurance product – whether commercial, individual, asset-related. Along with that we will see a pooling of capital from larger groups of people, with lower entry costs required for issuers than in the past where, for example, a single large entity requires millions of dollars in capital to issue. This naturally diversifies the risk associated with the insurance default.  

In addition, new products such as parametric and event based insurance.  Lastly we will see enhancements of current business models, and new models for the industry leveraging real-time data sharing capabilities.