Steve Zylstra
President and CEO, Arizona Technology Council


The financial technology (Fintech) sector is among the most promising and fastest growing in today’s technology landscape. More than $50 billion has been invested in nearly 2,500 Fintech companies since 2010. Arizona businesses are actively participating in the growth of Fintech by offering a diverse range of products and services that potentially could “disrupt” traditional financial models.

Blockchain is one of the primary technologies leading the Fintech industry due to its promising capabilities of revolutionizing multiple facets of the United States economy. This technology allows supply chain, financial transactions, asset ledgers and decentralized social networks to run more efficiently. To understand blockchain, picture a spreadsheet that is duplicated thousands of times across a network of computers. Then imagine that this network is designed to regularly update this spreadsheet and you have a basic understanding of the blockchain.

Blockchain can help improve property law, credit enforcement, financial services and crowdfunding agreements. The technology promotes improvements in these areas by solving fraud and inefficiencies brought by traditional paper contracts. Blockchain also enables the storage of information across a network of personal computers, making the network not just decentralized, but distributed. This means that no central company or person owns the system, but anyone can use it and help run it. The use of U.S. National Security Agency-level encryption in the blockchain makes it incredibly difficult for any one person to take down or corrupt the network.

Blockchain’s groundbreaking technology is leading the way for a new realm of business models. Similar to the internet, blockchain is altering models for both businesses and consumers, and the technology is likely to facilitate new commercial interactions in the future.

Arizona recently passed a bill amending the Arizona Electronic Transactions Act to include digital signatures recorded in a blockchain, which preserves the validity and enforceability of contracts. This regulatory clarity has become a primary reason why Arizona has become an attractive place for blockchain companies to develop their applications.

Arizona-based Nexus Earth is one of several local companies developing innovative applications of blockchain technology. The company is currently researching three types of networks that work cohesively to form a new, telecommunications system. In addition to Nexus Earth, other influential organizations pioneering technology in the blockchain sector include Arizona State University, Dash, KryptoPal and Sweetbridge. Also, one of Arizona’s largest technology sectors, cybersecurity, is benefiting greatly from the state’s emergence as a blockchain leader.

To combat the hindrance of blockchain growth, the Arizona Technology Council is working with its partners to advocate for a streamlined, transparent and supervisory experience for cryptocurrency and non-bank firms. This experience needs to provide a level playing field for both large and small businesses while appropriately protecting consumers from harm. One way Arizona could accomplish this is through collaboration with other states and organizations to establish common, multi-state money transmitter licensing (MTL) laws that would ensure legal and regulatory reciprocity between participants.

However, Arizona has a key advantage in its realm of policy makers. Many of Arizona’s legislators are dedicated to fostering the growth of blockchain and firmly grasp the impact this technology can have. Some influential policy-makers include David Schweikert, co-chair of the Congressional Blockchain Caucus and congressional representative; Mark Brnovich, Arizona Attorney General and Jeff Weninger, member of the Arizona House of Representatives. The commitment of these legislators can further result in significant advancements for Arizona’s economy.

While blockchain and cryptocurrency startups are emerging in Arizona, the state is also home to several innovative companies in other areas of Fintech. AmCheck, BillingTree, Desert Schools Federal Credit Union, CARDFREE, Infusionsoft, PayTech, Unanet and Upgrade Inc. are all applying Fintech to their operations. These companies are working to streamline payrolls, credit transactions and customer relationship management (CRM) software.

In addition to these applications, another key opportunity for Fintech is the Internet of Things (IoT). According to a recent study, there will be an estimated 263 billion connected Fintech devices worldwide by 2020, totaling an estimated $35.2 billion in IoT spending. Companies with a major presence in Arizona like Honeywell, Intel, Uber, Avnet and Boeing are leading the way in IoT innovation.

Because Arizona is becoming a hub for blockchain and Fintech startups, it’s critical to promote legislation to further advance this growth. While Arizona has positioned itself as a leader in the Fintech sector by amending the Arizona Electronic Transactions Act, other state regulations aimed at traditional banking and financial services tend to deter these innovations and emerging business models. Fintech startups are particularly disadvantaged by the difficulties and costs of complying with traditional MTL requirements. The Council and its Public Policy Committee support the passing of legislation to permit a “regulatory sandbox” to allow these startups to grow.

The federal government need to determine its own internal uses of Fintech, develop pilot projects and integrate Fintech into its processes going forward. This will provide government officials with a hands-on understanding of new technologies, in addition to empowering administrators and lawmakers to craft more effective legal and regulatory structures that work for a broad array of stakeholders.

Blockchain technology is revolutionizing the functionality and security of Fintech, including cybersecurity, contracts and IoT. If business and government work together effectively, blockchain can unite people across the world in ways that have yet to be imagined.


Steven G. Zylstra Sc.D. (Hon.) serves as president and CEO of the Arizona Technology Council, a role he assumed in December of 2007. He is responsible for strategy, operations, all financial matters and accomplishment of policy development for the Council. Steven is a vocal spokesman for the value technology can provide in raising social and economic standards in Arizona. Steven has served in numerous technology leadership and advisory roles to the Governor and currently serves on several association, industry and community boards, including being recognized as an Aspen Institute Fellow for his work in workforce development. Between August 2013 and August 2015 he served as the Chairman of the global organization Technology Councils of North American (TECNA). Steven can be reached at 602-343-8324 or at