Central banks from over 90 countries participated at the event titled, “Finance in Flux: The Technological Transformation of the Financial Sector,” where the Chamber of Digital Commerce, a global trade association representing the Blockchain industry, helped facilitate discussions at an event hosted by the Federal Reserve, World Bank, and IMF in Washington, DC on June 1 through 3, 2016.
Adam Ludwin, CEO of Chain, delivered the keynote address in the Board of Governors of the Federal Reserve System’s Board Room.
“Blockchain technology will provide central bankers, regulators and policy makers with new tools to enhance the safety, soundness and capabilities of the financial markets and payments systems globally. As participants on industry Blockchain networks, regulators will gain real-time transparency to measure systemic leverage and monitor compliance. And as potential operators of networks for issuing central bank digital currencies, policy makers have the opportunity to forge a payments system that will enhance security, reduce settlement times and create new possibilities for monetary policy,” said Ludwin.
“If I hold this $20 bill in my hand, you know I am the owner. But if I hand it to you, you are now the owner by virtue of the fact that you now hold and control it.
So here’s a pop quiz: now that I have handed you the $20 bill, how do we go about clearing and settling the transaction? It’s a trick question of course, because the answer is that we don’t have to.
With bearer instruments the payment is also the settlement. It is one step. This is a neat property of a bearer instrument. But if the bearer instrument is physical, we have to be in the same room to achieve this. However, with digital bearer instruments like Bitcoin, we can achieve a single payment = settlement step over distance. For example, watch as I send the Wikimedia foundation some bitcoin. Now that I’ve sent it, we are done. The funds moved over the internet. It is as if I handed them cash.
But wait, don’t we have a digital payments system today? Not really. In almost all cases we have a digital messaging system, and those messages trigger a series of steps across multiple organizations: record, clear, settle, reconcile, etc.
The goal of the blockchain industry is to collapse these steps into a single step, where payment is the settlement, just like with physical notes. This is what I mean by digital value transfer, which I sometimes like to call money-over-IP. Soon, the phrase “cross-border payment” will make about as much sense as “cross-border email.”
Jeff Garzik, CEO of Bloq and Bitcoin Core Developer, outlined the innovative elements of Blockchain technology, including trust shifting, decentralization, cryptography, immutability and others.
“Some of the greatest potential benefits of Blockchain technology are going to be first seen and actively leveraged in emerging nations,” said Garzik.
In her remarks, the Chair of the Board of Governors of the Federal Reserve System, Janet Yellen, addressed heightened concerns about cybersecurity. She also said that it’s undeniable that the global financial system has benefited from FinTech and encouraged central banks to do all they can to learn about financial innovations including bitcoin, Blockchain and distributed ledger technologies.
Perianne Boring, Founder and President of the Chamber of Digital Commerce, encouraged the Federal Reserve and central banks to focus on and embrace innovation in Blockchain and distributed ledger technology.
“We believe Blockchain technologies are capable of providing the Fed and other regulators with next generation tools to fulfill their mission of monitoring the safety and soundness of the financial system more effectively,” said Boring.
Chain CEO Ludwig was blunt in his keynote:
“Many people are asking the wrong question when thinking about blockchain technology. That wrong question is “How can we use a blockchain to streamline our existing systems? The right question is “What role should we play in the emerging digital asset economy?”
“There are many questions and implications of such a future, like the impact it would have on credit creation in the economy, whether it could or should be used as a new tool for monetary policy, and how to protect the privacy of those who hold digital currencies.
But the technology is here and the first movers will find that it grants their currency a comparative advantage as network effects get created around faster and more secure payment networks.
This is why we see central banks around the world already beginning to ask and answer these questions through real technology pilots,”
- Bitpay Opens Up Doors For Ethereum Payments - September 16, 2019
- Neufund Launches Blockchain-Driven Equity Token Sale for Retail Investors Out of Lichtenstein - September 16, 2019
- London Blockchain Accelerator Academy Looking for Partners - September 13, 2019
- Blockchain Startup Blockstack Raises a Whopping $23 Million In SEC-Qualified Reg A+ Token Offering - September 12, 2019
- France Vows to Block Facebook Libra Cryptocurrency in Europe - September 12, 2019
- R3 and Mastercard Team Up Mastercard to Build Overseas Payments System Build on Blockchain - September 12, 2019
- ConsenSys Officially Joins Hyperledger Project – Adding Public Blockchain Capability to Hyperledger - September 11, 2019
- Telegram Open Network Labs Releases Development Suite for TON Blockchain - September 11, 2019
- Whale Alert: USD One Billion+ BTC Was Transferred in One Transaction Last Week - September 11, 2019
- New Professional API Trading Program AlgoX Prime API Launched by eToroX - September 11, 2019
- Bitcoin.com’s Roger Ver Steps in to Operate Node on Cryptographer David Chaum’s New Elixxer Project - September 11, 2019
- Seychelles Heats Up With a First for a National Stock Exchange – MERJ Exchange Goes Live with Tokenized IPO - September 10, 2019
- Computing Legend Steve Wozniak To Launch Blockchain Energy Project – EFFORCE - September 10, 2019
- Hollywood Star Wesley Snipes To Tokenize $25 Million USD Movie Fund with Liechtenstein Blockchain Innovator LCX - September 9, 2019
- Netki Extends TransactID Solution For FATF “Travel Rule” Compliance - September 9, 2019
- Market Demand For Sophisticated Crypto Trading Methods Drives Singapore’s Broctagon Fintech Group To New Heights – Pushing Them Past $5 million - September 5, 2019
- London-based Custodian For Digital Assets, Copper, Reach $500m In Transactions In Just Three Months - September 5, 2019
- UN Meeting: Gibraltar Lawyers Call For A Global Regulatory Framework For Cryptocurrencies - September 4, 2019
- Michael Terpin’s BitAngels Investor Network Partners with Bitcoin Bay to Expand Blockchain Investment Ecosystem in Toronto, Canada - September 3, 2019
- Coinanalyst Launches Socializer – New Communication Tool - September 3, 2019