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Common Misconceptions about Working in the Blockchain Space, Part 1

Before starting at Paxos, I had a lot of preconceived notions about working at a company that uses words like crypto and blockchain to describe products. These notions caused a lot of hesitancy as I evaluated the opportunity –  it almost pushed me away, which would have been a big mistake. This post outlines some of my initial revelations now that I’ve been with Paxos for a few months. While I’m approaching this from a product management perspective, my hope is to dispel general misconceptions anyone might have in joining a company in the crypto/blockchain space.

Misconception #1: Finance is inaccessible unless you studied it for years

Unpacking finance is actually not nearly as complicated as I thought. I’ve worked for some tech startups in more mature industries that have been far more difficult to understand. And because Paxos acknowledges that the learning curve can seem steep, we’ve invested in areas to make this easier. Whether it is our public facing masterclasses or our comprehensive onboarding experience, Paxos helps employees get up to speed quickly. Plus, bitcoin is only 10 years old – the entirety of the ecosystem has been blogged about since day one. Google and whitepapers are a blockchain newbie’s best friend. Every startup in the space has launched with thorough documentation as a requirement for entry. 

Misconception #2: The “product” problems I’d be solving would be unlike anything I’ve ever encountered before

While there are definitely some technical challenges I’d classified as unique, the majority of the product challenges are similar to issues I’ve seen before at other tech companies. For the unique technical challenges, we hire engineers with specific domain expertise. I’d say it’s similar to working with machine learning. While you’re going to have at least a few PhD level engineers who specialize, it isn’t the expectation that everyone knows these ultra-specific technical details, you just need to be able to work with these colleagues more generally. Instead, most of the product work is similar to what I’ve already experienced. Bottom line: software is software and that applies to companies in the crypto/blockchain space as well.

Misconception #3: Everything we build has to be a special snowflake

As a corollary to my previous point, I also had concerns that we’d need to create many custom tools. Fortunately, I was also proven wrong again. In 2018 alone, $4.1B in capital was invested in blockchain startups, meaning the vendor ecosystem is rapidly growing and maturing. We can make thoughtful “build vs. buy” decisions for much of the blockchain-specific tooling we need. Very rarely does the “buy” analysis yield a result of “this solution doesn’t exist.”

Source: https://www.cbinsights.com/research/report/blockchain-trends-opportunities/

Misconception #4: Finance is already a “high-tech” industry

Our co-founder & CEO Charles Cascarilla’s “eureka” moment for launching Paxos resulted from his experiences during the 2008 financial crisis. He saw first hand at his asset manager how outdated technology could not keep up with the pressure exerted on the financial system. Assets like cash or stocks and bonds could not be located by trading counterparties because ledger systems were unable to keep up with the rapidly changing realities of the stock market. That meant if one trade could not be completed, it could cause a chain reaction for the entire economy. 

Chad saw that blockchain could theoretically be used as a better ledger system for keeping account of all the world’s assets. Anyone who has read Flash Boys or used Robinhood can see the innovation happening at the buying and selling level of the stock market, but few are aware that little innovation has happened to the critical back-office systems that power the global economy. Believe it or not, most of the core operations that our financial systems are built upon technology from the 1970s. Paxos is working to modernize that infrastructure and bring greater efficiency to that system. It’s in desperate need of an upgrade.

Stay tuned for part 2, coming soon.

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