Name: Should mainstream financial institutions care about blockchain?
Uploaded: 2022-05-23T14:06:11.534Z
Duration: 220.63
Description: It only takes one question to spark a powerful discussion. "Hot Takes" brings the biggest names in the business to answer all your burning fintech questions.

Hot_Takes_Blockchain_V3.mp4

Should mainstream financial institutions care about blockchain_.vtt

English

{{00:00:00}}
So when blockchain came along about
seven, eight years ago,   in anger,

{{00:00:04}}
what happened was everybody was afraid.

{{00:00:06}}
All the banks are going, oh my
God, if this works, we're going to

{{00:00:09}}
lose a large amount of business.

{{00:00:20}}
So mainstream financial
institutions are always,   reluctant

{{00:00:25}}
to    disrupt their own business.

{{00:00:28}}
So the challenge is with using new
technologies like blockchain and crypto

{{00:00:31}}
has been that it undermines their status
quo and undermines their businesses.

{{00:00:37}}
So when blockchain came along about
seven, eight years ago,   in anger,

{{00:00:41}}
what happened was everybody was afraid.

{{00:00:43}}
All the banks are going, oh my
God, if this works, we're going to

{{00:00:46}}
lose a large amount of business.

{{00:00:48}}
And so what they've done is
they've been really afraid of that.

{{00:00:51}}
Now what's happened in the last
two or three years is something

{{00:00:53}}
called de-fi, decentralised finance.

{{00:00:55}}
And that's the foundation of which is
blockchain technology, the foundation of

{{00:00:59}}
which is crypto,   and the representing
representation of an asset digitally.

{{00:01:04}}
And what we're really seeing is now the
next phase of financial services, which

{{00:01:09}}
is called decentralized finance, which
is effectively changing the structure

{{00:01:13}}
of the financial markets, which are
rather than centrally owned by the banks

{{00:01:18}}
and centrally owned by governments.

{{00:01:20}}
They're becoming decentralized
and,   not controlled by anybody.

{{00:01:26}}
So the banks will eventually
adopt these things.

{{00:01:29}}
They already are.

{{00:01:31}}
They're doing it reluctantly, you
know, maybe five years ago, they

{{00:01:34}}
were just not doing it because
there's the, why should we do this?

{{00:01:37}}
There's no real value.

{{00:01:38}}
But what we've seen is even the last
five years that they've realized that

{{00:01:42}}
there is business value and there is
a place for them in the marketplace.

{{00:01:46}}
And they're now spending
a lot of money doing that.

{{00:01:49}}
One of the things that they're
still resisting is the application

{{00:01:52}}
of  financial services and the new
world of de-fi decentralized finance.

{{00:01:57}}
So for example, borrowing assets,
borrowing money, or having loans, or

{{00:02:01}}
having derivatives, all of these things
will absolutely change into,   into

{{00:02:05}}
the de-fi world and the mainstream
financial markets will adopt this.

{{00:02:09}}
The challenges are things like
regulation,   certainty, risk.

{{00:02:14}}
All of these things are still questions.

{{00:02:16}}
And most governments haven't really
issued new regulation and it's taken

{{00:02:19}}
many, many years for governments to
say, we are going to adopt this and we

{{00:02:23}}
are going to correct regulation because
the reality is it's not going away.

{{00:02:27}}
So a lot of the banks, I think in
the financial services industry,

{{00:02:32}}
thought this is going to go away.

{{00:02:33}}
It's not going to be around.

{{00:02:34}}
We just have to ignore it.

{{00:02:35}}
But the reality has been actually
the adoption's increased.

{{00:02:39}}
The financial services industry realized
that actually there is business value

{{00:02:43}}
for us, and we can position ourselves to
be part of this new world and create new

{{00:02:48}}
products and services that they could
offer to the marketplace and actually have

{{00:02:52}}
a new revenue streams that it can create.

{{00:02:54}}
So there's been a shift over the last
few years on what the business value

{{00:02:58}}
is and they've gone from, well, I'm not
going to do this because it's going to

{{00:03:01}}
undermine our existing business too.

{{00:03:04}}
We can actually create new
business opportunities based

{{00:03:06}}
upon blockchain technology.

{{00:03:08}}
And therefore they've now started to
adopt it also because regulation is

{{00:03:13}}
now being put into place in lots of
different countries around the world.

{{00:03:16}}
And that makes it safer for institutional
investors, for asset managers, for high

{{00:03:21}}
net worth individuals or family offices,
and obviously individuals and retail

{{00:03:25}}
investors to be safe in the knowledge
that this is being taken care of.

{{00:03:31}}
And therefore adoption is, is low
risk and it, it will get adopted.

So when blockchain came along about
seven, eight years ago,   in anger,

All the banks are going, oh my
God, if this works, we're going to

So mainstream financial
institutions are always,   reluctant

So the challenge is with using new
technologies like blockchain and crypto

has been that it undermines their status
quo and undermines their businesses.

And so what they've done is
they've been really afraid of that.

Now what's happened in the last
two or three years is something

And that's the foundation of which is
blockchain technology, the foundation of

which is crypto,   and the representing
representation of an asset digitally.

And what we're really seeing is now the
next phase of financial services, which

is called decentralized finance, which
is effectively changing the structure

of the financial markets, which are
rather than centrally owned by the banks

They're becoming decentralized
and,   not controlled by anybody.

So the banks will eventually
adopt these things.

They're doing it reluctantly, you
know, maybe five years ago, they

were just not doing it because
there's the, why should we do this?

But what we've seen is even the last
five years that they've realized that

there is business value and there is
a place for them in the marketplace.

And they're now spending
a lot of money doing that.

One of the things that they're
still resisting is the application

of  financial services and the new
world of de-fi decentralized finance.

So for example, borrowing assets,
borrowing money, or having loans, or

having derivatives, all of these things
will absolutely change into,   into

the de-fi world and the mainstream
financial markets will adopt this.

The challenges are things like
regulation,   certainty, risk.

And most governments haven't really
issued new regulation and it's taken

many, many years for governments to
say, we are going to adopt this and we

are going to correct regulation because
the reality is it's not going away.

So a lot of the banks, I think in
the financial services industry,

But the reality has been actually
the adoption's increased.

The financial services industry realized
that actually there is business value

for us, and we can position ourselves to
be part of this new world and create new

products and services that they could
offer to the marketplace and actually have

a new revenue streams that it can create.

So there's been a shift over the last
few years on what the business value

is and they've gone from, well, I'm not
going to do this because it's going to

We can actually create new
business opportunities based

And therefore they've now started to
adopt it also because regulation is

now being put into place in lots of
different countries around the world.

And that makes it safer for institutional
investors, for asset managers, for high

net worth individuals or family offices,
and obviously individuals and retail

investors to be safe in the knowledge
that this is being taken care of.

And therefore adoption is, is low
risk and it, it will get adopted.

Hot Takes

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It only takes one question to spark a powerful discussion. "Hot Takes"  brings the biggest names in the business to answer all your burning fintech questions.