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Money20/20 Panel: Integrating Blockchain Into Mainstream Business

Source: bitcoin

Money20/20 Panel: Integrating Blockchain Into Mainstream Business

On Sunday afternoon at the Money20/20 Conference in Las Vegas, a panel of industry experts discussed the exciting potential of blockchain applications and the array of solutions being developed to meet the needs of a wide number of players. Panelists urged the packed auditorium to take a serious look at the quickly evolving cryptocurrency technology space, and honed in on the need to lower settlement costs and times.

Also read: Money 20/20: BitPay Announces New Mobile App

Much like the internet of the early 1990’s, blockchain applications can potentially open up an entirely new ecosystem for digital project deployment. Financial services firms are increasingly aware of this opportunity and issue.

Money 20/20 Panel: Which Mainstream Firms Use the Blockchain?

Overstock.com is one organization taking a lead in this realm. Through trading their stock on a blockchain, settlement times are reduced to 10 minutes. Judd Bagley, director of communications at Overstock, pointed out the power of exponential change ushered into the financial services industry by blockchain technology:

“Most tech changes only affect point marginally. This isn’t a small matter of degree, this is orders of magnitude difference. A 90% reduction in cost.”

Such cost reductions make a real business case for blockchain technology to financial services providers such as payment processors looking to cut costs.

By 2017, Overstock will have established a beachhead for blockchain-based equities trading, but will in-turn need to convince others to join the t0 platform. Through eliminating counter-party risk in times of panic, such as the Great Recession in 2008, or the Flash Crash of 2010, opposing parties can leverage shared ledgers to ensure the accountability of an opposing party.

Emmanuel Aidoo, Director of Investment Banking Technology at Credit Suisse, pointed out how much capital is stifled by being locked up in the slow, overhead intensive traditional systems. Credit Suisse has a lot of legacy in these traditional systems, and needs to figure out how to merge with blockchain in the with existing cloud and internal IT solutions.

Many industry players’ hard work is beginning to pay off, as blockchain technology applications have moved towards launches and direct proofs of value. For example, IBM is using blockchain technology to show that transparency provided through a blockchain enables for quicker dispute resolution in for food quality intake tracking on Chinese supply chains.

Jacob Farber sampled things through pointing out that all blockchain application can move beyond Bitcoin towards pointed gateway applications to be implemented within financial systems.

“We went from Bitcoin, what’s that? To, Bitcoin,watch it,” Farber said. “And now, to an assumption now that blockchain technology will be deployed, it’s just about how and where.”

Initiatives such as the R3 consortium, made up of over 50 banks, large financial institutions now collaborating on massive scales to research the potential applications of blockchain technology.

So where are we in the hype cycle, you may ask? Yolanda Goettsch, Vice President and Associate General Council at NASDAQ  was rather optimistic.

Estonia, for one, is a leader in collaborating for instituting blockchain applications, as shareholder voting in a use case in the NASDAQ-operated region. NASDAQ’s Linq platform already enabled a successful trade of shares from Chain.com to a private group of investors last December. Through eliminating processes that are done manually, reconciliation costs are lowered as peer-to-peer, real time information on a distributed ledger can increase efficiencies for many parties.

Furthermore, according to Goettsch, two-thirds of banks are working on commercializing blockchain tech by 2019, with many proof of concepts will go into production within the next 2 years, may take 5-8 years.

The panel painted a rather optimistic future for adoption of blockchain technology. Large players are rightfully looking towards the technology to offer a competitive advantage, increase security, and scale with the experimental blockchain infrastructure in development. Exciting questions are additionally raised around crowdfunding projects and their relation to these initiatives.

What are your thoughts about the increased adoption of blockchain technology? Share your thoughts in the comments below!


Images courtesy of Ryan Strauss.

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Money20/20 Panel: Integrating Blockchain Into Mainstream Business

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Overstock Announces Publicly-Traded Shares on t0 Blockchain

Source: bitcoin

Patrick Byrne Overstock

On Tuesday morning at the Money 20/20 Conference in Las Vegas, Patrick Byrne, CEO of Overstock and t0, announced the historic arrival of trading publicly offered Overstock shares on the t0 blockchain.

Also read: Money 20/20 Recap: Ethereum, Consumer Protection, Investment

Overstock Moving Forward With t0

Starting on December 15th, individuals who purchased Overstock shares by the November 7th record date will qualify to purchase shares of its preferred stock, including preferred shares to be issued and traded exclusively on the t0 platform.

As such, Overstock will become the first company to legally trade a publicly listed security on a blockchain solution.

Overstock intends to offer up to one million shares of its preferred stock, and will give stockholders the opportunity to subscribe for shares of its Blockchain Series A Preferred, which will trade exclusively on t0. Through this, the t0 platform will be demonstrated as a functioning, live proof-of-concept for potential further expansion of equities trading on the platform.

Spurring American Blockchain Innovation

Regulators understand that innovation is coming, and don’t want America to be left behind.

Acknowledging this, Byrne remarked, “We wanted to do something that met the standards of American regulators.”

Through forming partnerships in with key industry players and remaining transparent with regulators, Overstock was able to overcome the technical and policy challenges to arrive as the pilot child for this initiative.

Detailing the history of hosting crypto-bonds on a blockchain, Byrne explained that such an offering is the culmination of years of collaboration and diligent work.

Two years ago, Overstock created Medici Ventures to explore possibilities around blockchain. By April 2015, Overstock had developed an order matching-engine linked to a blockchain. In June of last year, they issued a $500,000 crypto-bond on the t0 platform, followed by a $5 million bond being the first privately purchased blockchain security in August 2015.

Upon receiving an S3 Declarative from the SEC in April of 2016, Overstock and t0 were able to proceed with the announcement.

Being the first large player to market in the crypto-equities space will enable for other organizations to learn from the process through which a company must take to publicly trade shares on a blockchain solution, as well as the advantages and challenges to using the t0 platform.

“My allegiance is not to Bitcoin per say, it’s to the blockchain,” Byrne said. “I’m one of the few who was here for the early stages of the internet and the early stages of the blockchain. . .and I think that the blockchain will be more disruptive than the internet.”

What do you think of Overstock’s announcement to issue publicly traded securities on the t0 blockchain? Will other organizations follow suit? Share your thoughts in the comments below!


Images courtesy of Ryan Strauss.

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Overstock Announces Publicly-Traded Shares on t0 Blockchain

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Patrick Byrne: Barbados Tests Fiat Hosting on Blockchain

Source: bitcoin

Patrick Byrne: Barbados Tests Fiat Hosting on Blockchain

At the Cato Institute’s “The Policy Challenges of a Decentralized Revolution” in Washington D.C. on Tuesday, Patrick Byrne confirmed that the island nation of the Barbados has indeed ran trials hosting their local fiat currency, the Barbadian Dollar (pegged at $0.50/1-dollar), on a blockchain equivalent. Mr. Byrne spoke to the larger trends ongoing with the technological shifts towards decentralization, and then off-handedly mentioned confirmation of Barbados’ successful trail linking fiat currency to Blockchain technology. Given the pioneering nature of this move, it will be a great case study for future nation states looking toward this technology in supporting fiat.

Also read: Security Experts Create Solution for Petya Bitcoin Ransomware

Barbados Tries the Blockchain

Answering a question about the Barbadian dollar experiment, Mr. Byrne confirmed, “We recently just bought a large interest in a Barbados company. The Barbadian Central Bank, quite intelligently, about a month ago was the first central bank to say ‘you can put our fiat on the blockchain’. And they were given permission to do so. A company down there did it, and we went and bought a nice little stake in it.”  The willingness of the Barbadian government to work with industry leaders such as t0 to help facilitate such a maneuver demonstrate the importance and potential symbiotic relationships between regulators and private blockchain firms, especially in the developing work.

The Barbadian dollar is relatively small in the global financial economy, yet its inclusion in such a trial run aligns with past initiatives such as that by the government in the Isle of Man.  Developing nations have strong incentives to help rid of corruption and find ways to be innovative in order to attract foreign investment to their capital markets.  To residents of the Barbados, this could prove to be very valuable to alleviate future travel hurdles and also in sending remittances abroad.  On a larger scale, the Caribbean islands and island-nation-states worldwide are ripe for blockchain adoption as a means to increase their exposure and investment channels.

One outstanding question, however, if whether or not the Barbadian Dollar is being traded directly on the blockchain equivalent, or if an “Alt-coin” representing the Barbadian Dollar with a 1:1 peg is being used.

Uses for blockchain technology can impact central banks on a more widespread scale, Mr. Byrne remarked.  “All of this can be done to create a transparent and rigid version of central banking… you can apply it to remittances which is a $500 billion industry of which $75 billion gets taken by guys in the middle. 87% of the world is unbanked, yet cell phone penetration can be 140%. Everyone can be banked on the blockchain.”

Speaking to the shifts towards regulators embracing the technology, Mr. Byrne added, “In fact, after 2008, there’s (I think) a $500 million budget to get a consolidated audit trail going. And you can do consolidated audit trail in the blockchain for about a tenth of that cost. There’s a lot advantages for the buyers, sellers, and regulators, thought there are some people in the middle who won’t be too happy about it.”

For the t0 system, the acquisition of the Barbadian firm adds to its robust technical offerings.  With the t0 software, “the trade is the settlement.” as one of Mr. Byrne’s slogans goes.  With Overstock positioned to use the t0 platform for blockchain securities processing, it will be fascinating to see if islands such as the Barbados implement blockchain technology to help with securities or commodities market settlements.  “My attitude was that they should love this. I mentioned that NASDAQ was formed with the desire in 1971 to have, among the broker dealers, a peer-to-peer electronic settlements system. Well that’s what the blockchain let’s us have.”

What do you think of the Barbadian Dollar and blockchain coupling?  Should t0 look to partner with other national institutions over hosting fiat on a blockchain?  Share your thoughts below!


Images courtesy of Patrick Byrne, NelsonCarvalheiro.com. 

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Patrick Byrne: Barbados Tests Fiat Hosting on Blockchain

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