Royal Bank of Canada Chief Describes Blockchain as a ‘Quantum Innovation”

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RBC logo is seen in Toronto financial district April 19, 2010. The Royal Bank of Canada (in French, Banque Royale du Canada, and commonly RBC in either language) is the largest financial institution in Canada, which is measured by deposits, revenues, and market capitalization. The Canadian Press Images/Francis Vachon
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Dave McKay, chief executive of Royal Bank of Canada, likes the blockchain, loves his bank’s mobile wallet and thinks banks should focus more on fixing their legacy systems than trying to pull fintech startups under regulators’ purview.

At least that’s what Robert Barba, technology editor of American Banker and editor-in-chief of Bank Technology News, is reporting. 

Here are takeaways from the conversation.

Dipping a Toe into Blockchain

Like most large banks, the company is experimenting with the blockchain, a technology that McKay described as a “quantum innovation.”

The company could roll out a loyalty program that relies on the technology known for its fast settlement and distributed system of recordkeeping by next year.

“It would be a nice hybrid step” into integrating the blockchain into banking, McKay said. “A loyalty account is a good, safe currency to start with.”

When asked why RBC would use rewards — rather than tangible money — as a test case, McKay said an unproven technology “begs caution.”

“It is a brand-new technology, and what do we really know about it? How cyber-secure is it? We are going to learn a lot more about it,” he said. “Given what is at stake, it is not something you can rush to market with and fix as you go. You want it to work.”

Although several recent announcements indicate that financial institutions are still curious about bitcoin and cryptocurrencies — not just the underlying blockchain architecture — McKay seemed uninterested in bitcoin, saying that the industry wouldn’t be “solving any problems with a new currency.”

Besides using the distributed ledger technology for its loyalty system, RBC is also one of the 13 banks that have formed an alliance with R3CEV, a blockchain startup, to develop commercial applications of distributed ledger technology in the financial industry.

“Some of these issues are best broached as an industry,” McKay said.

Read full article here.

About Richard Kastelein

Founder of industry publication Blockchain News, partner at ICO services collective CryptoAsset Design Group (helped raise over $200m+), director of education company Blockchain Partners (Oracle Partner) and ICO event organiser at leading industry event  CryptoFinancing (first ICO event in Europe) – Richard Kastelein is an award-winning publisher, innovation executive and entrepreneur. He sits on the advisory boards of half a dozen Blockchain startups and has written over 1200 articles on Blockchain technology and startups at Blockchain News and has also published pioneering articles on ICOs in Harvard Business Review and Venturebeat.
 
Kastelein has spoken (keynotes & panels) on Blockchain technology in Amsterdam, Antwerp, Barcelona, Beijing, Brussels, Bucharest, Dubai, Eindhoven, Gdansk, Groningen, the Hague, Helsinki, London, Manchester, Minsk, Nairobi, Nanchang, San Mateo, Shanghai,Tel Aviv and Venice. His network is global and extensive.
 
He is a Canadian (Dutch/Irish/English/Métis) whose writing career has ranged from the Canadian Native Press (Arctic) to the Caribbean & Europe. He’s written occasionally for Harvard Business Review, Wired, Venturebeat, The Guardian and Virgin.com and his work and ideas have been translated into Dutch, Greek, Polish, German and French.
 
A journalist by trade, an entrepreneur and adventurer at heart, Kastelein’s professional career has ranged from political publishing to TV technology, boatbuilding to judging startups, skippering yachts to marketing and more as he’s travelled for nearly 30 years as a Canadian expatriate living around the world.
 
In his 20s, he sailed around the world on small yachts and wrote a series of travel articles called, “The Hitchhiker’s Guide to the Seas’ travelling by hitching rides on yachts (1989) in major travel and yachting publications. He currently lives in Groningen, Netherlands where he’s raising three teenage daughters with his wife and sailing partner, Wieke Beenen.

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