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IBS Journal November 2015


how banks can test or experiment with it, Buitenhek jokes that the ‘credo is to fail cheap’. Banks should try small things, so if they don’t work it’s not catastrophic.


© Sibos


But as he says: ‘If you ask ten different people about blockchain, you will get ten different answers’. As way of an explana- tion, he says it is best to look it as a pro- tocol – such as Java or the internet. Neal Cross, CIO at DBS Bank, was part


of the ‘yes it’s a solution’ brigade and adds that blockchain is the ‘next big thing’.


The look of love Buitenhek got the audience’s views and asked ‘how seriously is your organisa- tion looking at blockchain technology?’ While the panel were players in the blockchain space, the crowd were look- ing in and wondering how to react to this new entity. The result showed that 32.1% were ‘just monitoring’ with 25% ‘actively engaged’. Discussions moved on to whether


banks were ready for the potential new order.


Bussmann believes they are. Some


banks are engaged in analysis and try- ing to understand more. He thinks they need to ‘team up’ with blockchain firms and set up some industry standards.


Warnings and worries Away from readiness, other issues were briefly looked at. Kim also notes that blockchain


hasn’t undergone enough ‘stress testing’


yet. It needs to prove it can ‘handle scale’ and firms need to ‘mimic’ the types of accounts and volumes they will have to deal with in the future. While Preston J. Byrne, co-founder


and COO of Eris Industries, warns that banks are losing the monopoly on trans- action verifications. He says blockchain ‘eliminates people, not machines’. Com- panies can compete against banks at no cost, but it also means fewer staff num- bers are required. Ludwinsays the industry must take


something ‘abstract’ and ‘make it real’ for it to progress. Dan O’Prey, CMO at Digital Asset


Holdings, says there is also a ‘lack of tal- ent’ as some companies struggle to find the right people to implement the plat- forms or join their firm. Leda Glyptis, head of EMEA inno-


vation centre, Bank of New York Mellon, agrees – and says the ‘talent is outside our organisations’. She also says: ‘We have new capa-


bilities to ignite the imagination, but we may have to redesign what we built’. In her view, the ‘old world stuff’ will have to interface with the new. There will be a lot of ‘philosophical questions and a creative struggle’ as blockchain enters the mainstream. In terms of how it progresses and


Awake, arise or be forever failing Taylor says blockchain is good at data veri- fication and removing the ‘towers of Babel’ that currently exist. But to implement such a standardising solution means the backing of a ‘heavyweight’ company.He thinks firms need to keep their ‘eye on the ball’ when it comes to developments so as to not get left behind. He thinks the next 18 months is a ‘battle for souls’ as blockchain firms need to persuade the big players to join their party. He may not have to wait that long. At the beginning of the hour-long session, the audience were asked the question: ‘How seriously is your organisa- tion looking at blockchain technology?’ Initially 20% were ‘seriously interest-


ed’, but at the end of the talks the same question was asked again to engage impact.The figure had risen to 34.3%. It seems the love for blockchain keeps on growing.


Day 2: Rules and refugees In a session on compliance for ‘big banks and small banks’, the latter are concerned about how they suffer in the marketplace. In fact, it was felt smaller banks are getting a ‘kicking’. The moderator, Jonathan Rosenthal,


editor at The Economist, oversees a dis- cussion on risks, the implementation of anti-money laundering (AML) and Know Your Customer (KYC) programmes, as well as higher-risk jurisdictions. The talk begins with the 300-strong


audience voting on ‘Have any large cor- respondents turned away business in the last three years?’ The options were simple – yes or no


– and 68% voted ‘yes’ due to the costs of ‘de-risking’.


Costs and savings Jack Jared, MD, business compliance and risk head at Citi, says AML pro- grammes invoke ‘significant costs’ and ‘many are not paying their way in terms of relationships with the banks’. An


© IBS Intelligence 2015


www.ibsintelligence.com


31


sibos 2015


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