By Joseph Raczynski
October 2017 – Blockchain 360 IoT Conference – InterContinental New York Times Square – An esteemed panel took the stage to discuss the state of the union surrounding proof of concepts in the financial industry. The focus of the six; to delve into what is working with blockchain, what is not, and what is ahead for the industry.
I had the good fortunate to moderate the group including Igor Telyatnikov, President & Chief Operating Officer at AlphaPoint; Ron Quaranta, Chairman, Wall Street Blockchain Alliance; Scott Matsumuto, CISO, Circle; Morgan Hill, Managing Partner, AxionV; and Yorke E. Rhodes III, Global Business Strategist, Microsoft.
The first topic lent itself to a deep dive in our current perspective within finance. Quaranta, who comes from a background in the financial markets spoke about how blockchain has developed incredibly fast. He has the perspective of an association where many groups of all sizes engage with the Wall Street Blockchain Alliance. While the financial institutions have been involved with this for several years, there are other groups flocking into the space. He said, “Now that you see the lawyers and accountants opening their eyes to it, you know it has legs”. They need to be involved because those two groups will help “aid the industry” and create structure around the new technology as it is applied to the financial industry. There was a bunch of head nodding on the panel in agreement.
Rhodes focused on what is preventing wider adoption of blockchain. One of the primary areas he cites is a lack of trusted sources or oracles in the space. These are known entities which can be a verifiable source of information. Think of the Social Security Administration and their records of death certificates, or a known source which can verify the price of Facebook’s stock on a particular date. While this data might be available currently it is not as well developed and built out to interact with the blockchain just yet.
Hill jumped into the fray by discussing integration and interoperability. Right now most blockchain’s cannot interact with other blockchain’s. They are siloed. Rhodes said that Microsoft is looking at how to resolve this issue.
The panel discussed how ICOs (Initial Coin Offerings) impact POCs. Telyatnikov described this phase as a mania that is currently a bit frothy, but noted this is a “new asset class” that will be here for the foreseeable future. The ICOs are almost POCs, but in the nascent stages, as “often these companies have concepts, which are not built out yet”. It is hard to have a POC when a company only has an idea spelled out via a whitepaper – with no working model.
The panel answered questions from the audience, including one around regulation. What is ahead for the law makers when it comes to blockchain and the financial industry? The panel chucked. Quaranta and Yorke summed it up for everyone by stating these are the early days of blockchain. “Legislators and other agencies are in the information gathering stage. We are beginning to get a sense from them about guidance, but much more is on the horizon.