Blockchain technology has created considerable buzz among all the major business enterprises the world over, and it’s not hard to guess why. The cutting-edge technology provides unparalleled utilities with regard to safety, transparency, and efficiency. As DLT has already shown promising results in industries like supply chain management, real estate, law, and finance, there’s no reason why it can’t venture into relatively unexplored avenues.
Take for instance Akropolis, a 2nd layer protocol aiming to leverage the decentralized nature of blockchain technology in the global pensions sector. It is a multi-jurisdictional technology platform for the delivery of pensions, social welfare, and future benefits in a portable manner, with a vision to bring together individual end users and large institutional players in a new system of incentives. The project is basically building the next-generation financial infrastructure to address the 3 main consumer pain-points of the $43 trillion pensions sector. The goal is to design an alternative pensions and savings infrastructure to the current deeply broken system where:
- Individuals have no self-sovereignty over their assets: pension funds are regularly being raided across the globe, both in developed and developing countries;
- No “single source of truth” in record-keeping and either no or poor portability of records, leading to hundreds of millions of employer contributions being left on the table by the user, which is essentially lost money;
- Individual pension contributions are massively eroded by a combination of high inflation and high hidden fees at every step in the value chain. The ultimate goal here is to create a generalized alternative infrastructure layer for managing pensions presented as a blockchain-agnostic layer-2 protocol portable over a number of other networks.
As the project dives deeper into the research of international pensions systems, country-specific challenges, regulatory and legal considerations, it is becoming apparent that in a generalized way it is tackling the ability of a distributed network to re-organize capital flows in entirely new ways within the system characterized by a set of assumptions, such as beneficiaries being largely passive, PFs abstracted as curators and delegated governing actors of the pooled groups of beneficiaries, and FMs abstracted as profit-seeking agents pursuing their goals of maximizing assets under management (AuM).
So, how would Akropolis develop a self-sustaining incentivizing pension ecosystem?
To begin, all actors are incentivized to maximize benefit distribution to beneficiaries. A passive beneficiary can trust the system to present him/her with the optimal selection of options (list of FMs, list of financial products, list of any options that satisfy long-term alignment of interests.)
It’s no secret that due to the actions of the companies and institutions around the world, pensions are collapsing and vulnerable consumers are paying the price. Lloyds Banking Group, for example, is in the midst of a multi-million dollar lawsuit that alleges that women received fewer benefits than their male counterparts.

(Source: Caroline Hernandez from Unsplash)
At the same time, Future Income Payments, a private pension fund based in the U.S., shut its doors after their operation proved to be little more than a Ponzi scheme that preyed on retirees. Offenses like discrimination and mismanagement are made possible by this demonstrably opaque nature of the current solutions, but blockchain technology’s transparency can renew confidence in a wilting industry.
With no extra interference, consumers on a blockchain-based pensions system could access previous changes to their accounts with total reliability and clarity. By far the most impactful element of the blockchain in a pension application is its fraud elimination potential. As discussed earlier, the construction protocol for each link in the chain unbreakable ties it to surrounding blocks, thereby making post-entry alteration by dishonest means almost impossible. Only approved rights-holders, then, would be allowed access (by private key) to their data.
By addressing the most pressing issues plaguing the pensions systems in place today, a totally novel rebuild with blockchain as the operating framework provides the best path forward. On a global scale, such an application would provide scalable traceability and accessibility of funds, solving the cash sinkhole that is fraud.
Consumers also benefit from the increased autonomy and accessibility of data, with a clearer path to discovery and dramatically improved authenticity. Blockchain technology provides for transparency in the management of beneficiary’s funds. Smart contracts execute scenarios of allocating pensions to the beneficiary’s account in a timely manner without any human interference, thus the risk of human error, bias or beneficiary’s funds being corrupted is eliminated.
A crucial part of the pension’s reform battle is already won: there is widespread consensus that the core change to the pensions system is needed.
In order to change the sentiment into proven result yielding action, Akropolis is incessantly working towards a transparent, smart-contract-based pension fund infrastructure which eliminates all the current faults of the pensions system. This would be a whole new infrastructure that incentivizes every stakeholder to work in the interests of the saver by encouraging saving, facilitating timely remittances, increasing understanding, making risks more foreseeable, and boosting our ability to avoid them, or remain resilient to them.
In Akropolis-like systems, a user is entitled to possession and control over their assets and savings at any time. It is basically an open borderless competitive marketplace for asset management service made of the set of crypto financial primitives that opens up access to effective asset managing strategies to virtually everyone.
R&D on the Potential of Smart Contract’s to Align Incentives and Eliminate Costs of Conventional Asset Management Systems
Akropolis has been conducting research in the field of crypto economic incentives and governance to tackle the issue of misaligned incentives in the realm of asset management. Being a part of the emerging stack of decentralized finance, or #DeFi, Akropolis is building a blockchain-agnostic protocol for decentralized pension management.
The Road Ahead
Akropolis’ latest major update from the month of November spans from the roll-out of the new website, the launch of the Token Generation Event, the revision of AKT-token model to polishing up the tech stack and protocol-level MVP. Last week, the project updated its GitHub with smart contract backbone. Earlier this year, MVU v.1.0 was released that is soon to be replaced by MVU v.1.1. featuring the new tech stack along with the brand look. The project is slated to release the MVP in the next coming month.
With regard to partnerships, Akropolis has no dearth of collaborations. It has already received requests from the World Bank Group in Washington and Irish Life in Dublin via a San-Francisco InsureTech incubator. There is also a large number of academic partnerships coming up including Oxford University and Imperial College London Centre for Cryptocurrency Research and Engineering.