Spring Labs, a Los Angeles start-up that wants to overhaul the consumer credit industry using blockchain technology, has added Gary Cohn, a former top Goldman Sachs executive and economic aide to President Trump, to its board of advisors.
The announcement marks Cohn’s biggest move since ending his sometimes acrimonious tenure with the Trump administration. The former official was a key figure in the White House’s tax cut plan, but resigned in March as director of the National Economic Council in opposition to Trump’s tariffs on aluminum and steel.
Cohn joins a board of advisors that already boasts a number of high-profile names, including Sheila Bair, former chairwoman of the Federal Deposit Insurance Corp.; Nigel Morris, co-founder and former president of Capital One bank; and Bobby Mehta, the former chief executive of credit bureau TransUnion.
Their association gives the start-up some immediate credibility in an emerging field of technology that has widespread potential applications but has been tarnished by its association with fraudulent cryptocurrency offerings. Last year, JP Morgan Chief Executive Jamie Dimon called bitcoin a fraud and “worse than tulip bulbs.”
Others remain bullish on the technology. Walmart recently announced that its suppliers of lettuce will have to use blockchain so any outbreaks of food-borne illnesses can be traced more rapidly.
Blockchain is essentially a digital ledger that’s kept on millions of computers at the same time. That decentralized network prevents any one person from taking ownership of the ledger and corrupting it. When changes are made, anyone with access to the ledger can see the changes.
Spring Labs, which raised $14.8 million in seed funding in March, believes applying blockchain to consumer credit could help thwart hackers and streamline the way financial institutions access personal credit ratings. By sharing that data using blockchain, banks can potentially circumvent credit reporting companies such as Equifax and Experian, which aggregate consumer credit information and sell it back to the banks.
“I have been very interested in blockchain technology for a number of years, and Spring Labs is developing a network that could have profound implications for the financial services sector, among others,” Cohn said in a company news release. “I am excited to actively support the Spring Labs team in the development of this important business and network.”
Cohn received an undisclosed amount of equity in Spring Labs, the Financial Times reported. Spring Labs could not be reached for comment.