The Opportunities Around Crypto

[Music] hello hello and welcome back welcome back to our last session of the day opportunities around crypto adoption for financial institutions as you can see maya is back with her christmas headphones headphones yeah or whatever it is to warm your ears that's nice because it's almost christmas welcome mariana welcome kim welcome simon and yeah this date is yours enjoy thank you thanks aquaria hey um guys the last session of the day um a long day at the ubc and uh as i said i was trying to uh to um cheer up the people could have been listening to the ubc for a whole day it might be a bit tired it's a i like to claim they're my wireless uh christmas um headphones but they're not they're just earmuffs so i'll take them off otherwise i won't hear you but uh listen it's a complete pleasure real pleasure marianna to have to be talking to you again um kim and simon um i think is is this um your first time attending the european blockchain convention um no i attended last april last year yes okay very good can you sign me i think same for me i'm sorry i'm video but yeah i attended last time as well as well fantastic very good so we're not completely newbies so you know what it's like um it's great it's great that it's a virtual it's great to have all the many people actually logging in what's not so nice is that if this was uh in unusual times we'll probably be meeting in barcelona it's the last one of the day we'll have a chat and then we'll go off and have a few years on a few glasses of wine and continue the conversation so unfortunately we cannot do that today so all we can possibly do is have a really nice discussion about what really matters to us that's why we're here um and um let's talk about um crypto clearly uh but also at the future of that um and and how it does have a future within the financial institution sector so listen i have you in order in my screen brianna came in simon if that's okay may i ask each one of you just to give me a couple of minutes intro about what you're doing where you're working um it's always great as well to um for the audience to hear how did you get bitten by the blockchain bug how did you got in to blockchain in the first place so mariana can i give you the floor first sure thanks thanks mai uh very quickly about me i'm the executive vice president for operations at crypto.com um and i currently lead an insanely large team that deals with back-end operations anything from customer services to risk and fraud payments reconciliation operational compliance and my teams are spread across the globe um i i would really love to answer how did i go into crypto because it's a very um funny story actually i i did have a very small investment in bitcoin and i was practically freaking out about it because i wasn't sure if um i made the right move there and then i met cz um in early 2018 and somehow i ended up being the first person that set up the offices of finance in europe and that's what really got me into crypto and got me very familiar with um not just with everybody in the industry because it was still um very small i would say although it was 10 years after bitcoin popped up still it was a very nascent um industry got to know a lot of people got to know the business a lot better and i told myself like only a couple of months after that it would be impossible for me to go back to financial services the way they were because they don't make sense anymore absolutely i can i can understand that i could totally understand that um and you're not the first person to say that to me so um yes there's like many many of us um thank you thank you mariana very interesting story um kim may i ask you to do the honors yeah sure thanks me um yes i work as a blockchain and cryptocurrency specialist at raibo bank at this moment um and i did a lot of different blockchain projects from self-suffering identity to tokenization but at this moment and for the last two years i only focused on crypto at the moment unfortunately um all the dutch banks don't have crypto services in their portfolio but that does not mean that we don't look into the crypto world what is happening around us what are our clients doing and are there possibilities maybe to start offering crypto services as well um so that's yeah i always say pretty pretty nice job in a traditional finance institution um and i came across blockchain and crypto five years ago during a lecture at the university i was studying digital business uh part-time besides my job and one lecture was about blockchain for like 45 minutes and it really stole my heart i really thought this is the future what a nice technology so many possibilities and that was also um the moment when i thought okay when i want to go into blockchain i also need to buy some cryptocurrencies so um yeah really cool very good so it was love love at first sight yes it was love at first excellent thank you kim um simon give us that two minutes on your journey please yes so crypto uh was not love at first sight for me funny enough and i touched crypto at 2011 in berlin um which was a bit early maybe and then i was like i should do more about this but then i was studying and yeah i just lost it and then it got me back in 2015 but then more from the general life technology side from blockchain side and i started to investigate use cases for commerce bank back then like analyzing 50 use cases for the bank and then started up in the newly founded blockchain lab and from there on then went to deutsche bers and now i at talking now further a german private bank and i'm heading their department for digital assets where we are building up own infrastructure and on the value chain so from custody to portfolio management everything that you could think of in managing crypto assets very good very good so um excellent well listen thank you thank you to the three of you um the panel discussion title opportunities around crypt adoption for financial institutions um it's a very very large broad title for the 45 minutes we have on on a monday evening um but a very neat one i think very very interesting one so um it talks about crypto it doesn't say about digital assets so i really like us to now discuss really about what we're talking about these cryptocurrencies i mean you've all talked about i know you're head of digital asset simon kim you've talked about cryptocurrency specifically looking out for rapa bank and mariana obviously because of your work and your experience in this last 10 years so um my question i suppose would be first um mariana for you why do you think that financial institutions would be wise to adopt crypto or to have a crypto strategy as in in a way yeah so at one end financial institutions i think have reached a level of development um that already comprises of everything that they could possibly do on the market the latest one being the open banking right if they want to develop any further they have to utilize blockchain one way or another whether they're going to take cryptocurrencies as a utility for blockchain or they're going to build other products on a particular blockchain um that may or may not be powered by cryptocurrencies they still need to follow the trend because we all know that with web 3.0 it may not come tomorrow right it's not one year away maybe it's two three years away but when it comes financial institutions that do not develop their product to be based on a blockchain are simply going to fall out and it's already very difficult even from a p l perspective to run a psp right everybody has the same products and services everybody's charging a minimum margin it's very difficult to find customers the one way is to offer value and added value to your customers and we all can see it it really stroked me a couple of months ago somebody told me that they asked me how do you see yourself as a competitor of revolut how big of a competitor is revolution they're not a competitor they have nothing to do with us this is not someone that we even look into and they're like well according to your users you are a competitor of revolut because revolut sells crypto and i try to explain it's not the same thing you know they don't own their keys or it's not they they can only sell that crypto back to revolut it's not the same thing but for users it is the same thing so whether you do it in a completely vanilla way whether you offer something like revolut half or you're going to go the full way and have a full ecosystem whether it's for centralized applications or decentralized applications you would still need to tap into that industry to stay adequate to everything that's happening around us that's that's fantastic insight um and and you're right um so many users would just say crypto and crypto.com is just direct competitor to to revolut so extending that um that challenge i suppose or that view um kim um how would rubblebank see the likes of them of uh crypto or coinbase or binance like would you see those as competitors would you look at those as the uh business model to uh to come in and adapt uh to stay relevant i mean yeah yeah well i don't think um it has been seen as a direct competitor but i think when you look clearly to what our clients are doing they are into crypto i read a research from last week in the netherlands 1.2 million dutch people have crypto so that is a lot and all those um persons are not uh having their crypto at a dutch bank or yeah doing business uh only with the bank accounts just sending their euros away to a crypto exchange like you mentioned and then it is out of our size and we i think we are losing partly clients on that part i also saw visa published some sort of info last week about that clients are willing to change their bank if they are offering crypto services so i thought it was like 20 or so so i think that's really a high amount so yes i i should say we offer a lot more of course than the crypto exchanges are doing so but i think like mariana said i agree um yeah we are develop yeah out developed or something like that uh on the on the products we already have and if we want to be a part in this new digital world then yeah we should adopt it and i also agree what you said about the blockchain projects i see that myself every day um one way or another we need to take the the crypto wheel as well to to join yes and i would about thank you for that i'm sorry kim um simon i would imagine you'd have a similar position do you see pretty much what kim is seeing yeah i think most obviously um i can tell for sure like within the existing industry there's literally no bank with let's say more than 50 employees i would say that serves private clients with bitcoin and we have now other players in the market and um i think what we what we see is basically that there is always need for financial services in crypto as well but there is no need for a bank and this is something that i think we have to keep in mind financial services is a serving industry we are offering services we have to fulfill client needs if we don't we fail our job and clients obviously have a need to invest in crypto in different vehicles so my conclusion is until at least now most of the banks have failed their job to be a financial service provider for the financial needs of a lot of customers and here i'm completely risking we now started to buy partially and build infrastructure for crypto specifically and also investment vehicles be it a cryptocustodian uh according to the german license um be it's setting up a fund so that you can invest in an actively managed crypto portfolio i think these are needs for people that do not want to engage for example too much in crypto but still see that there is a market homo heterogeneity yeah that one should recognize at least and and so for this reason i would say yes the banks have failed their job including what i have done previously to some extent and this leads to them and i'm here with kim as well losing clients at least clients in crypto for example because there are other financial service providers that provide this very service that they need and so they offer solutions for this need of their customers which makes them the correct service provider and if the banks do not come down from the high horse saying like what is okay and what is not okay but serving the clients in a proper and regulatory compliant way of course that they need but not saying like this type of asset class is not regulatory compliance so i won't do it they will simply go somewhere else simon very interesting and i think very insightful as well um i think you're right and i think i'm not misquoting bill gates when he did say what 25 30 years ago when we don't we don't need um banks but we do need banking um and i think this is along the lines and we certainly that the need for that service is going to be there i also do think there's lots of different nuances and different ways to attach that so um potentially and so maybe that's a question for you um we tend to look at crypto and financial institutions in a very black and white uh manner so there is a bank you need something you need you know there's a payment you need x so it's quite a binary in black and white whereas um with the acceptance of of say retail acceptance of cryptocurrencies even even d5 and i know that this panel discussion about d5 but as the other dlt technology application is moving and exploring new financial services money and the services in financial services institutions is also changing so it's potentially a case that in the future we might use different payment providers depending what the monies might be used for the same way that we use different methods of transport depending on the distance um and this is an idea that i wanted to float and i said with all of you um it's probably less about competition but more about over time um actually building a niche for each one of those so that crypto might be used for something um in a very specific way and then other money or if you have money or whatever might be the future for something else but this is looking at cryptocurrencies um in the payment sphere okay then we also have investment speeds and then we have financial institutions that do invest in crypto so um i said crypto is a very high level um title for lots and lots of layers underneath and this is something that we need to be um very cognizant cognizant of so let's bring it back to it to a level um and i'm conscious there's a there's a couple questions there but um um i i totally agree i think chris reed i'm i'm i'm calling you out because your name has come up and that's a problem with virtual i don't get to see your face and i don't like to look at the audience and ask your questions but we'll come back to you and your questions i think you're you're totally right potentially um in terms of in the future financial institutions and um and cast crypto asset service providers there will be an element of of of merging potentially but we'll come back to that said let me park it for a little bit um marianna can i come back to you again um you you mentioned something just thought it was very very interesting as well and you talked about cryptocurrencies and the utility of cryptocurrencies and this is a very important important point because dlt in the cryptocurrency is a utility in the layer and then that's very different from the cryptocurrency that's actually seen as a commodity as an investment so how do you see the potential for that let's decouple the cryptocurrency the utility layer from the currency investment case and tell me do you see either of them an opportunity for a financial institution and how would they go about to utilize it as an opportunity so perhaps it's best to also decouple what a financial institution would mean in that case i'm i'm going to take the european example since i said in europe and that's way easier for me but if you look into financial institutions this would normally have a financial institution license which practically means payment services then either the new psd2 aisb and the pisp or an emi um company right so if you look at these companies the services that they have been authorized to provide play around the provision of payment services we don't speak about investments right investment services holds under mifit and these are not financial institutions these are different kinds of institutions so financial institutions would most likely go around the use case of payments right and i think this is the most i wouldn't call it a failed attempt um from a blockchain perspective but this is the lesser um the the less strong opportunity in crypto because cryptocurrencies are still very volatile a lot of people would love to pay for their goods in crypto however there are a couple of issues one is what happens if i keep let's say my money in f and then f depreciates because of market conditions and it just goes down and i no longer have 2 000 euros i have 1 000 euro and this really is going to hurt my personal finances so i don't want to be paying with my ass because i'm just waiting for it to appreciate in value then maybe turn it in stable point then maybe pay with it then there is a second thing um and that's regulation right right now paying in crypto is actually frowned upon because regulators have no means to control that so they have the means to control the investment side and that's i would say already very well put into a framework that is going to be executed by introducing mica but then um paying by crypto is still done in um i would say less optimal way right um if you look at australia who are the first ones i think to introduce crypto payments you are even able to pay your taxes and and your utility bills in crypto but the way this was done is technically you're paying crypto and then there is um an exchange that takes your crypto conversation fiat and then pays your bills in fiat currencies um the same happens in merchant acquisition right and there we for example have a product that sits on one of our blockchains that offers merchants to accept crypto payments but then again these merchants can choose to have a fiat settlement so we're still utilizing the bank network for that um so we're only going halfway through there isn't a full convergence between providing payment services in crypto and then taking a crypto settlement and a lot of this i think has to come with market volatility and regulation per se um i think financial services companies are um more and more interested like we get a lot of companies interested in partnerships with us because they want to introduce crypto one way or another they recognize the fact that they may not have necessarily the expertise they want to partner with someone who is strong in that and provide financial services added to it but then there is the other point as well right a lot of the uh crypto companies that actually wanted to build a starter business just like crypto.

com it took us a while to get there right you started in 2016 and somebody would say well it took you five years to get where you are but the reality is if you want to exist in the future and you know that the future is going to be happy to regulate it you start preparing yourselves very slowly by stepping on the footsteps of compliance sturdy sturdy compliance getting those licenses takes a lot of time all of you know because you come from regulated environments so we took the very hard steps of first investing in a compliant platform and then ramping up the services um in the last couple of years that we offered to form that ecosystem um and a lot of uh i would say the decent crypto companies would do the same thing which kind of leaves financial services outside of this because once you have those licenses yourself you're very unlikely to partner other financial institutions if you can close the circle and remove the intermediaries which the blockchain is all about right um we speak about the removal of the intermediation so i think the one way uh financial institutions should go is to try and either partner smaller companies or just build the expertise on site so that they can again remain relevant in the services that they are authorized to offer or just get new licenses and go into a completely new line of business which um i think proves to be rather difficult right there's a huge difference between um payment services directive and the markets and financial instruments directed to separate business lines super fascinating i think that's that's there's so many so many strands of conversation that we could pick up there particularly i'm just in my mind uh for example um this afternoon i think it was uh i think it was big stamp and they mentioned that um 120 out of the 600 staff were actually just doing compliance yeah um you know which is huge uh and we are looking at kim and simon and their respective banks you know i mean do you even know i mean in comparison um how many people do you have in the banks um because we know and we know the regulation entities compliance compliance costs are high um but yeah even even with the technology and what it can do um clearly that there's a there's a huge ramp um i think to to to have to climb also um another something else has come up there as you were talking mariana and you mentioned about partnering for example and it's come up in one of the questions as well there's a two-way street i think in in this case right in some cases you mentioned mariana financial institutions reaching out to crypto.com with potentials uh to partner because they don't have that uh crypto services um experience in-house to bring that in um and kim and simon i don't know maybe maybe your respective financial institutions are building out that that um that staff that knowledge with the potential maybe to go back out but i was just wondering um there's also um an element of mistrust of financial institutions right and this is a challenge back to one of the questions from from the audience um you meant you mentioned kim that um 20 um of uh dutch people i think would be willing to change the bank if they offered crypto right so how many how many crypto holders would be willing to to change bank if the bank started to offer it and what's a limit of trust so some people mistrust financial institutions because what happened ten years ago because the financial crisis um and they're willing and happier to actually have control of of of their uh cryptocurrencies or of their financial um well-being um so i just think it's a little bit of who would be providing um reputation services to whom would it be the traditional bank um you know bringing in a crypto service in-house to appear to be cool to you know to to kind of to really modernize themselves and and set forth would that be detrimental you know like would cryptocurrency holders want to have that partnership or would it be decoupled from from um from a finance institution what do you think kim what do you think simon yeah i think um i think it's yeah it's in separate ways you can see this right i think there's a large amount of people that already already found their way so to crypto.com to binance to other dutch players for example that also have a license at the at the dutch gentle bank that part maybe is okay with that want to stay at their at their provider as they are uh happy with it maybe right now but i also still think there's a large amount as i speak for the netherlands that yeah is not so sure about the provider that yeah they bought their cryptos at and um is not so sure how to save store their crypto assets uh on a ledger for example or another hardware wallet or there's also a lot of people that lost their keys you know i think that's still a large amount so on the one hand you have people that say i will be my own bank and i don't want to have crypto services at the traditional uh bank but um yeah we researched already i think three years ago um ourselves how the market was moving back then and we wanted to start crypto services but back then yeah the dutch regulators were not willing us to do that so that's why we did not proceed um but yeah clients were already uh telling us back then that they lost their keys that they are not so sure what to do in the market etc so yeah may i i'm not sure what the percentages will be but they're yeah they will be divided listen like kim i think that's very interesting and um i i mean exactly i mean you're talking to you to your market and i do think there's an element of very different nations have very different levels of financial literacy they're very different levels of cryptocurrency adoption and and reasons of being so yeah so what's happening you know in salvador and venezuela for example is totally different to uh say a nation like japan which they were really in uh on the bitcoin very earlier on and they might not be um as comfortable or as willing maybe to to accept um and invest in it in another cryptocurrency so i i really appreciate the insight to the dutch market i think it's important because we do tend to uh gener generalize uh speak in general terms and we talk about crypto but we're all quite individuals and we do live in in a society environment and and i do think that um trust in government trust in in the banking and services even your experience with the financial services i think they're all obviously uh determinant um as to whether um you're happy to just to do your crypto services yourself or uh trust it to a trusted bank okay so like an example here in ireland um it was a research piece done last year um a lot of young people were happy to say become customers of revolut because they didn't want to bank with the same bank that their mom and dad were banking so uh you know this is just a totally you know a very unique maybe thing to to to our jurisdiction here but i think that uh um that's an a cultural element to it that's very that's definitely interesting um simon what do you think about this do you think that um your entities selling cryptos would that be seen as a cool thing to do and do you think that it will work the other way around what's your experience we are starting to offer different products for making crypto investable for our clients i think what you stated before is quite important that there is not a common client i think every client has the individual needs there are clients that have similar needs that makes it easier to target them and that's why different banks have different target groups for us as a private bank a regular retail client is simply not the target group this makes our service differ from other bank services because our service is much more tailor-made to some extent so if you go into the crypto space or as you discussed before like who's your competitor why is revolut competitor because it fulfills similar client needs right and it addresses similar target groups maybe and for us also a crypto solution is maybe to some extent need and especially as we also target that let's say like smith small sized nc clients as well that of course here the client needs are completely different uh from the one of a private client yeah and a larger family office wants to invest in products that completely differ from a product that a private client wants to invest in so our job is to tailor products to the client needs in crypto as well and i think a common misconception here is that crypto is a totally different animal and everything's different yeah i i think so yeah um there are similarities between crypto and existing asset classes there are difficulties that are especial to crypto of course especially when it comes to for example as you have mentioned custody for what we regular business call corporate actions yeah corporate action in crypto is for candling and not so many financial institutions yet being familiar with how to handle a fork uh you have to teach them yeah and if you teach them then they already know okay it's maybe similar to a volunteer with a corporate action or a fund and then if you're setting up a fund for example where crypto is being owned of course you have to handle fork when you do a fork handling as well but then ultimately for the client it's a position in the account and for most of the clients the need to invest in crypto is to have it in their portfolio at least and their will to to move somewhere else only to invest in crypto already shows the potential that the asset class has now what if they could simply just stay maybe for a bit of higher fees yeah and not have to keep accounts separately separately for another asset class so what i see as a job is like make crypto investable now for our clients in the way that they need it yeah and in a way that it's convenient why do private clients go to something like revolut or i think personally to be honest the trade republic has done it very well because there it's also in your portfolio only and then we also see that the clients ultimately do not care maybe about best price or whatsoever in the market if it's convenient yeah a lot of crypto solutions out there simply to it's new to its novelty are very convenient in how it's being handled for an institutional client convenient means that it's part of his portfolio that he still gets his tax services and that he can still simply book it into his accounting system that's convenient for instant client very different from convenient for private client and so we have to differentiate the market groups i think banks will have to investigate what is our current target group in terms of customers do we still want to target them or are we losing existing ones even maybe do we want to target additional then maybe we do need to offer a different solution even because our current product portfolio is not even tailored and the people are not tailored so then we need a really different organization and that's when banks start to buy other companies yeah for us we have partially board companies partially we are building up on products for their own products it has to fit the existing infrastructure including the target client group for new target client group maybe i need another infrastructure it might make sense to partner by very listen very very useful insightful and i think you're you're you're totally right i mean at the end of the day um financial institutions have shareholders that have a p l products have to make sense so not only in revenue terms but also in terms of value offered to to those customers um and on that there's michael astra just put in a quick question there directed to kim and simon but maybe i'll ask you simon to answer it first because i think it's uh it links to what you're just mentioning there um what kind of projects are you working on to get blockchain i would say crypto into the site of the regular portfolio of the organization i think you've answered that in terms of um looking at what the customer wants and particularly looking at private clients um would you be able to give one example simon and then maybe i'll pass it on to kim so so an example of our product basically what yeah sorry it's in the questions uh what kind of projects are you working on yeah okay sorry so um we are setting up a fund for making crypto investment for our clients we are investigating at least um how to issue a node because there might be different um a different target group that prefers that we have bought a cryptocustodian and are thinking about making it possible um to to also make direct investments in crypto available via the cryptocustodian and within the manco that will issue the fund we are also setting up capabilities to offer basically everything the value chain from portfolio management only to issuing for a third party a crypto fund to maybe doing like only cryptocustody and depository services that's that's very useful that's very useful insight so when you meant to fund um simon do you have a particular cryptocurrency in mind um like would you be largely bitcoin is it a case that you're still exploring that here we have um i mean the current limitation might be simply the kind of tokens that are or assets that are already connected in terms of the custodian because you have to put it in custody as well with the custodian but here we are not focusing on singular assets i guess that we will have at least 10 crypto assets in the portfolio for the beginning and we'll actively manage that with we have two open positions currently one a portfolio manager for crypto specifically and an analyst for crypto and so they will basically actively manage the portfolio within the scope of at least 10 10 currency sources very good so any of you listeners um there's jobs there to be had call simon after this uh very good i like that simon um kim tell us um any specific projects would you like to um give us an insight so we we we see how rubber bank is um um capitalizing on the opportunities of crypto for for the institution yes i think it all starts with knowledge right and um when our blockchain team started five years ago it was fully focused on blockchain and not so much on crypto so i think for the last couple of two two and a half years we are focusing more on crypto so it has all a lot to do with sharing knowledge um yeah present a lot to important stakeholders within the organization um so we also set up a crypto board where uh different expertises come together so compliance legal risk but also our kyc department what are our clients doing in our daily lives with crypto and what kind of cases do we see so we discussed that um every two weeks so that's really uh on a high frequency and we see that yeah more and more colleagues as well are gaining more knowledge around this topic so i think that's a really good thing and also yeah a basis you need to at least start crypto projects and for myself i researched a lot of custody providers last year and also yeah seeking for opportunities to start with uh for rabobank um and i had the opportunity uh to present about the world of crypto and decentralized finance at our managing board uh last month so that was really cool so um at least i've been at the highest level of the organization to tell them what's happening in the crypto world what our clients are doing and yeah what we as a tech lab should do into next steps and that's a part i cannot tell you a lot about but at least we are researching the possibilities your research in the possibilities okay very good i mean and having this conversation at c-suites level obviously i think it's totally part of that of that potential crypto adoption uh certainly for financial institutions you know the um the decision makers at the level and certainly those that manage risk within a financial institution need to understand and be educated in terms of what crypto is and it it definitely isn't um very good marianna um maybe i i'll turn that question around to you i mean you you're you're seeing things completely from the uh from the other perspective and and and i'm sorry because we did have a stephanie from gemini who was meant to join this panel uh discussion but unfortunately um um she she isn't um unwell to be able to join it so it's it falls squarely on your shoulders and mariana so from from the cryptocurrency asset provider point of view how do you go about you offer your services do you consider um financial institutions are doing this that that's not what we're gonna do is it a case of you know what you're doing you know your clients you're going ahead um it's not so far that you're looking for partnerships or m a um activity potentially to um to to go hand in hand with your business um which is strategy maybe the short term you guys are very clear in terms of what your markets are and you continue with this tell us um so since inception right i think crypto.com was very very different from the native crypto companies that were existing at the time because if you look at kraken and the likes they all started as crypto exchanges whereas crypto.com actually started as a payments company the first product um that evolved around the crypto ecosystem was the crypto.

com card that card was done with the corporation with visa and the people that the the initial team and that was gathered had a lot of specialists that came um from visa from mastercard people with financial services backgrounds so we started as a crypto bank payments company so for us the journey was always very different since day one what we had in mind is to proliferate the usage of crypto across the world to just facilitate the adoption of crypto we wanted to see cryptocurrency in every wallet right this was our motive to do that you have to start with a product that in the beginning resembles something that users wanted we have always had in mind to create the crypto ecosystem that comprises of all use cases of finance so we were never going to limit ourselves just to products um that resembles new banks so that people can sign up that's just the beginning the centralized front end has always been just a way to show people that it's not so different as simon said it's not so different these asset classes are just a new way to call a certain asset class but it resembles currencies it resembles commodities it resembles securities so it's not so different to work with it you just have to pretty much put behind the bias if i'm not tech savvy i don't know if i'm going to be able to even sign up go through kyc i don't know what to do with this it actually resembles any card that you have having um set the foot out okay we're going to start with crypto adoption the easy way to get the people who are most difficult to convert not not the crypto fanatics but people who are a little bit later later in in the adoption curve and then we started adding more advanced projects so then came the exchange and obviously trading on an exchange i i know crypto i think did a lot for the financial literacy of people overall because many um private investors were not private retail investors were never investing in stock before in their life their first investment purchase was in crypto um so people got financially richer um not just in terms of money but also in terms of knowledge then we started doing the d5 projects and built our own blockchain and recently um launched the first d5 project on our kronos blockchain that already is for more advanced users but what we're trying to say is you have a full ecosystem you have every use case that you could possibly have you can enter at any stage that you like maybe you're an advanced user and you just want to join a liquidity pool and have some really fancy apy and earn from the cryptocurrencies you already have or maybe you just want to own some bitcoin because you heard that it's going to reach um massive value in 2023 and you want to be part of it you can do either you don't have to choose you can enter at any point of that ecosystem so this is what we're trying to build to create a real community to be a real participant in building web 3.0 you have to allow different participants to access at a different point um i saw a question in the audience that went around defy and the importance of defy in the future services and in the marginal communities it's insanely important right it's a permissionless um application you can enter without kyc so you can potentially sit in a country um that the u.s does not favor that much and usually you get denied onboarding at centralized exchanges you don't even have to have native crypto right now um you can also buy with your credit cards on certain defy applications right and you can enter um that ecosystem you can maybe make a little bit more by participating and lensing pools where you can maybe um you know even get a loan yourself to invest any further it all helps you develop first your mind and your edu educationally it's priceless because to enter a defy ecosystem or a centralized one even you still need to familiarize yourself with how all of this works and ultimately it leads to um puts you closer to let's say financial independence maybe not in all cases everybody would be so lucky to actually reach a financial independent stage but it opens up doors in literally every corner of the world that being said of course again it's going to be heavily regulated that's why d5 right now plays a huge role i think defy in a way will be self-regulated moving forward there are talks in the u.s that this is going to um be the next thing in d5 but even so if you look at the convergence between financial services and maybe dfi applications i totally see how banks or financial institutions can be the forefront of these services and the services will be run on a defy application on the back end so you would still have this fully compliant front end but actually be able to offer the fancier services that a defy application can give you access to that's super insightful marianna and um um i think your last comment is really interesting and i think it would be great for us to uh to bring in um the d fights in the comments um i didn't want to get too deep into it because we know we have very dedicated d5 sections in ebc over the next couple of days as well but um you've spoken to d5 um in crypto.com you obviously have the products you mentioned how they're probably more for the um a bit more i would say expert or a bit more um sophisticated investor of sorts and a very recent um chain analysis uh report showing out the default adoption um was actually showing a really high level actually the largest d5 market in the world beans concentrated in europe um and asia being the second which i think is quite interesting now that seems or it speaks to me to institutional adoption of d5 it doesn't speak to me to the um moms and pops and you know young people actually getting into d5 just yet um i think it's it's certainly not the case and and the generalized analysis report pointed out to institutional investors of you know ten thousand sorry ten million dollars um which is quite a big you know it's a big chunky transaction level certainly not something i'd have in the back of my pocket so keem and simon when it comes to defy um is that step too far for your institution in terms of looking at crypt adoption is this um at the moment um reserved as mariana has mentioned maybe to the most sophisticated and bold investors um are you financial institutions maybe exploring or waiting into the approach what do you think kim yes of course at our team we are exploring this field as well because it is in line with crypto um i really think when traditional institutions want to do something with d5 it must start somewhere with providing crypto services a custody surface things like that to offer yeah defy on the other side because traditional central institutions are not decentralized finance institutions but they can offer their clients a way to that world and i also believe that yeah financial institutions might have an important role over there also on the education side um yeah what is this all about you know i think a lot of people are into crypto and define not knowing what they are doing um and not knowing what kind of protocols and what kind of code is beneath the the platform they are using um so yeah that might be a possibility and i really think yeah it's good to look into that and within our team we are researching of course this field thanks kim what about you simon [Music] so for me personally um banks especially that are strong and advisory services are in a great position to be a gateway into d5 even though it might look ironic i mean the whole concept of d5 was like directly giving access but to be honest it's quite technical now there are a lot of starters being founded to making defy access less technical and it's a very same development as crypto in the beginning right people who needed to get an own wallet needed to be tech savvy in the beginning and to set it up as some regular guy that's not an idea regular woman that's almighty they might not be able to set up wallet right and to download a full node or a flash node or whatsoever yeah and um so so we see now companies building up that need that is upcoming to cover that need and if there are clients of us that want to in somehow invest in something that is connected to d5 they have to get access and so forth it's a prime position to provide them with access the difficulty now is banks starting to build up infrastructure for the crypto side where they have kind of lost track at least last year's now d5 around the corner explain to your board members why you now need the money for the crypto side and the defile and by the way also electronic securities that are also upcoming especially in the german revolution with the elect electronic security act and then you say oh i need all of that and then they say like okay you think you should focus a bit and you're like yeah but you don't need the crypto stuff because they're already gone and you need the security stuff because that's your home turf and the electronic fund shares by the way as well then you'll say okay you need to also to prepare for default and then they say maybe look i already built a 20 people apartment for you in a bank that's not too large um so i think you should better be a bit calm and finish of stuff first and then go into the default space and that's the difficulty i i guess um even so i would say our house for example is quite bullish on it and especially from the board side really with actual belief in that this is a disruptive and innovative technology and it's still hard out of a running business like not separately funding it from outside as an own kind of business um to to here kind of tackle everything that's also difficulty of banks because banks regularly want to fulfill all their customer needs of course and that's also very much sales driven but if you look how how different startups are approaching it there are startups that are dealing only with cryptocustody software then there are startups that are doing the cryptocustody itself then there are startups that are specializing into define then there are startups that are specializing in the tokenization then there are startups that are doing specialization in token analysis and chain analysis yeah and so um if you're now coming as a bank and saying that we won't do everything then it will be quite hard to do this and you won't get it funded as well you said this before like in a startup you have maybe like hundreds of peoples ultimately that are dealing only with crypto compliance and then i'm coming along and saying look uh i managed to get a one crypto compliance uh full position yeah for for the bank that's already quite impressive but they have like 30 people over there yeah why it's a separately funded own company with own structure that's purely focusing on this one business goal and personal purpose so my takeaway is we have to address define it's at the core of my belief that is the prime position for being a gateway into d5 for a regular bank the question will be in what speed can i take the bank with myself to provide which kind of services at which point in time and which urgency and um this is a difficult question which i'm getting paid for so often after very good summer yeah um very good listen simon victoria showing up with herrera light and i have to stop you there but um i have a solution for you simon we need to get all your board in the bank free tickets to attend the next ebc and then you'll get all the funding you want for all the d5 projects because then they'll get to know what it's all about so that's my solution for you um listen um yeah victoria shows up which means ah we run out of time which is i'm sorry because um i could if we were in barcelona or in denmark right now having this in the flesh we'd be going off i said to the bar having a few um venus and we continue to talk absolutely i've learned so much from you guys i've taken a few words to summarize our discussion and about the opportunities of around crypto adoption for financial institutions i've taken conversions as a big word so we're not talking about dying when i talk about taking over we're not talking about any sort of i think conversions is a good way i think there's an element of of the two elements um on the crypto side of the financial institutions coming together um i've taken the not crypto crypto's not so different um famous words from simon i totally love that the way you said that he totally he starts to feel it's not that different when you start really understanding some of the products there um i like the giving what users want i think this is very important because at the end of the day what users want and to mariana's point um the dlt technology allows for that universal participant access which is something that sometimes financial institutions have lost um a way to to to to provide to each one of us so with that mini summary a huge thank you to mariana kim and simon we did miss stephanie but um you did fantastically well i learned so much and thanks to the audience for the amazing photo questions um and until next time and thanks victoria for this chance to uh to participate in ubc again thank you everyone thank you thank you thank you thank you kim yeah i think it was an amazing way to wrap up the day and well we still have four days to go so uh that's amazing you know you can all reach out to to the speakers mariana simon mai and kim via the people's tab and also you cannot i mean not just it's not just about reaching out to speakers it's also about reaching out uh out to people between you some of the other um oh attendees so make sure to network you know tomorrow we're starting again at 12 central european time so you have the whole morning to do networking so make sure to do networking at the end of the day you know it's very important for us that you learn through the european market function and that you connect with whoever you need to meet and to make sure that you reach the next step within your within your project i know maybe you're looking for a new employee maybe you're looking for an investor maybe you're looking for a client they're all there so again thank you so much for the four of you amazing we're ending up the first day of the european block dimension 6 edition bye bye everyone