What Makes a Financial Institution Say Yes to Tokenization? | EBC12

Good morning everyone. Thank you for joining us. I just wanted to say something about what Daniel said earlier, because with so much fake news and people constantly trying to organize and promote everything. I've been working at Tradfi for 30 years at Goldman Merrill Credit Swiss and I can 100% say that I've never been to a conference that could truly bring these different ecosystems together in one place and make them work so well. There were institutional, regulated, unregulated, startups.

So it was possible to have these discussions, to communicate with regulators, politicians, which is really very special. So, okay, let's get started. So, good morning everyone. Our headline asks a deceptively simple question. What makes a financial institution agree to tokenization?

The numbers tell us that this is no longer just talk about proof of concept. RWA, the platform’s data aggregation platform , tracks about $39 billion in distributed tokenized real- world assets, excluding stablecoins. And in wholesale markets, the Broadridge distributed repository platform processed an average of 357 billion per day in June. So that's 700-7.5 trillion per month.

So we know that the technology can work at a significant scale in some parts of the market. But the scale of individual use cases is not the same as wholesale institutional implementation. What makes this conversation about competition, uh, particularly useful for a number of the institutions represented on the panel? We have a large state-owned financial institution, Europe, sorry, a European digital asset platform, blockchain market infrastructure, one of the world's largest payment networks, and an insurer. This is important insurer.

This is important because tokenization does not happen in isolation. Token issuance is just one part of a much larger transaction. Someone must want to own it in order to use it. There should be a market around it. Infrastructure must be connected.

Money has to move, and someone has to understand and manage the risk. So instead of asking each panelist what tokenization looks like from their own corner of the market, I want to bring these pieces together and ask what really takes an institution from experiment to adoption. So, I want to start the introductory round, and I'm going to ask each person to introduce themselves and then answer this question. I think this is a more flexible way to do it. What has changed the most in the last three years that makes an institutional “yes” more likely today?

Lloyd, if I may start with you. Hi, my name is Lloyd Nelson. I, um, manage digital assets at Howen. We are a large commercial insurance company based in the UK. And I'm at the intersection of insurance and innovation, and my role is to enable large institutions to scale, ahem, without having to take on risk that they don't have to that they don't have to .

And I've seen a lot of innovation in the last three years. And, um, I've seen institutions go from asking, "Are we really doing this?" to, um, "How do we do this responsibly and how do we do this at scale?" Because once you represent real clients and you represent real money, well, risk management, um, comes to the fore . But also, uh, innovation will get you to a pilot project, but, uh, trust is what but, uh, trust is what allows an industry to scale.

So, these are certainly my thoughts. Yes. Thank you, Matia. Nice to meet you, Matia. I lead the European, uh, crypto team at Visa.

Uh, what we do as a team is scale, uh, digital and blockchain digital and blockchain solutions with our traditional fintech partner. What we see in the market, if you look back at the last, say, four or five years ago, we had what we call crypto- we call crypto- linkage, where some of the most innovative, uh most innovative, uh , crypto players were allowing people like us to spend their crypto assets. I think we're seeing a shift now where a lot of traditional players are actually seeing the value of using, uh, blockchain, uh, for payments. And, uh, that's because it solves some real-world use cases use cases . But I wouldn't say that, like payments, it's definitely a key factor; but that's not the only driving force behind why a bank, acquirer, or financial institution in general is actually exploring blockchain.

There are a lot of other, um, nuances around treasury and internal optimization that happen in the background that then contribute to this. Let's say when these things happen and we see demand for them, then payments become a factor that enables these use cases. So we're really seeing, um, real demand, and we can talk about that later. Thank you, Sandro. Thank you.

My name is Sandra Kepo. I lead the market structure and strategic partnerships department at the Cardono Foundation, and, um, my background is in capital markets. So I've worked in capital markets for 20 years, and what's changed in the last three years is that we've moved away from these buzzwords. We used tokenization for fun things. I remember around 2018 in Switzerland when we started or when we were talking about the first, um, FMI regulated, um, digital exchange, we were still trying to figure out what we could tokenize?

What can we do, what can we not do today. And that conversation has changed now that we see tokenization being applied to certain existing assets, additional access assets to increase accessibility. But with the understanding that tokenization or issuance is like the very beginning, and then you move into the lifecycle, and that's where the conversation is happening today. Um, sometimes I say it's probably the most boring part of the business, but it's the most important. If we do not comply with the requirements, we will fail.

So, um, we've grown up quite a bit in the last three years, and it's great to be on a panel with such great colleagues. I just want to say that I was on, um, I was on a wave in Monaco, and someone was talking about, um, someone was tokenizing these little dolls, and I just couldn't get it, but, Nadia, please. Um, hello, Nadia Fidali. I'm the Chief Innovation Officer at Queso. Um, I've been working on the topic of cryptocurrency and DT for over 11 years.

Um, we are a custodian of cryptocurrency for the government. 10 years ago, we launched a startup called Liquiter, dedicated to asset tokenization, which was a kind of first infrastructure on this issue. But the difference, uh, today is that there's a shift in the institutional part, uh, because there's really strong action happening in the US. And I think that's one part of the movement here. When, uh, a market or a government decides to move a market to a tokenization market, that's something very powerful, and I do n't know how it happens in other parts of the world.

But in Europe we are reacting to this, uh, this moment. Uh, the second point is maybe when we start working on this, you have some post- trial experiments. Good. But you can't keep working with one test on the same bones, etc. And last year it was seen in this room, but it was nearby, and I said if you want to have institutional adoption, we need to, uh, get not only the people in the room who are here not only the people in the room who are here , and we've been talking about digital assets together for years, but also get the operational side in the room.

And that's what we do: if there are four institutional representatives in the room, then there 's an operations department in the room, I'm very happy about that. But also we are launching a strategic roadmap for the group and we are really working specifically on what we are doing for five years to fund the ecosystem, to provide storage services, settlement services, etc., and also to get different types of training, expertise for the market and for the internal KZ depot, to work with research, and last but not least , to transform and issue and invest in real tokens, financial tokens, as I said. And the world is moving, moving fast, and I hope this time it really is moving. Hello everyone.

I am Sabine Leu. I worked at Kcoin EU, and Kcoin EU is a Mika-compatible digital asset platform regulated in Austria. Of course, it was a journey, um, to becoming a Mika-compatible platform, and um, from initially being a global centralized exchange, and my previous um, role before joining Kcoin was um, at the London Stock Exchange. So, I've been doing, um, business development in the stock trading industry for 14 years, and, um, I think that's a very good question that's a very good question , what's changed in the last two years. I think what changed for an institution to be able to get into, um, the digital asset space is that everyone came together to actually build the market infrastructure.

Tokenization is certainly only the first step, as Sandro just said, and it concerns issuance; but if you look at the entire life cycle of capital markets and trading, there are many other steps there, and then we need that to be completed, um, for institutions to feel comfortable feel comfortable coming in. And of course, this is supported by the regulatory, um, developments that we've had , um, over the last few years in the US, but also in Europe in Mica; and, um, also, um, ultimately, that's what's driving people wanting to be in the tokenized space. So I look forward to today's discussion today's discussion . Thank you. Thank you very much everyone.

Hmm, Nadia, let me give you the floor. You talked about, you know, you've been working at a financial institution for over ten years in the blockchain space. What really needs to happen inside it for a successful experiment to turn into real production? First of all, we decided to launch this strategic support roadmap, sponsored by the DPT KDEO head responsible for KDE asset management. The bottom line was that there are assets in the group .

I won't talk about it because I'm not sure everyone here knows what it is, but it's a public financial institution. Within the group you will find BPI France, for example, private equity investments; you will find the French Post bank, and so we have different types of insurance, also with CNP, and we are a very big investor, so we have the opportunity to try different things. And we decided to launch this roadmap, looking at what we can do for the ecosystem, because that's part of our role. But how can we get the operations department to work? So, we had the first , uh, release in November 2024 with Bong France, and everything was clear.

It was one time, one operation. But the first reaction of the finance team was: “ team was: “ Why am I doing one operation, one transaction here? It's not my job to do just one transaction; "It's a little uncomfortable." So we brought together the entire operational value chain, from start to finish, into a working group. We are also trying to reach the IT community.

But here, I think it's more complicated because I'm not sure that the IT not sure that the IT system will be the same as it is today. Hmm. At the end of tokenization, but that's a different topic, and, uh but that's a different topic, and, uh , we also work together with the compliance department and all the people in the room. I think one point that is also really important is that this roadmap is supported by our CEO, it is supported and it is of interest to all the participants that we work with, even the regulator in France and Europe, so if you have real leadership and support for your actions, you will move faster. And you won't just act, sorry, this is truly human, this is not a technical moment.

I think once we move to production, we also need to recognize that today you don't have an STP system to run all your transactions or all the experiments that you run. You don't have just one technology, you have different technologies. Uh, maybe you don't know how to manage a wallet, uh, so it's a little different when you have securities or bonds and you don't see anything, it goes through STP in your system. Everything is different here. You need to embrace it early on, so we're working with the team to embrace it early on, and we want to be agnostic in KDO about what system we're working with, because at the moment, okay, there's a step moment, okay, there's a step , but it's really, um, um, not defined at the moment or the infrastructure that we're working with.

Thank you. No, you are absolutely right. I mean, if you don't have, um, support at the highest level, it's really hard to get anything done. Infrastructure is incredibly important. Collaboration between top and bottom.

Absolutely. I just want to say if any of you want to make this interactive, so if you have anything to add, challenge, or change, please, please go ahead. Um, Sabina, I just want to reach out to you. So, we heard from the institutional side, from the market, and from the client side. What do you think?

What needs to happen to achieve real, ahem, real demand from your customers? I mean, if you look at Cool Coin, as an exchange and as a broker, the clients are mostly retail, including quite a few institutions that are now entering the market. But I have to say, if you look at traditional exchanges, a lot of their customers in the pool are still web customers, original customers, who don't really need much convincing. They will come to trade on the platform. Yes.

I think the problem that needs to be solved is not in this equation. The problem that needs to be solved is for the people who really manage big money, the people who really work in traditional institutional finance, to realize that there is potential in blockchain and potential in digital assets. How do they get into this world? I think that's exactly the question. So I don't know question.

So I don't know if I can speak for them completely , but I think if I were in their shoes, if I were at the London Stock Exchange, what would it really take for them to come? It's not just a shiny product, it's the entire infrastructure. So, very simply, I mean, everyone in the room knows this well : tokenization is like the issuance phase, but after it, you need a secondary market. So, after tokenization, there is distribution, but essentially distribution, but essentially , you need to go to the secondary market, where you need liquidity, and you need to have true pricing. And then the question: clearing and settlements.

And this is a very common thing in traditional finance traditional finance , but in cryptocurrency people are discussing, "Do you really need clearing and settlement?" I think it's not that we need to copy everything in Trefy, but from my perspective but from my perspective , everything in traffic happened for a reason, and that reason is not related to technology. There are many other reasons why legal risk management happens, besides all these so-called intermediaries or functions. So I think we need to embrace this wisdom. But now, with blockchain, cryptocurrency, and other great technologies, you can, excuse me, block blockchain and all these great technologies, when you add that layer to the traditional market functions, then you can start to sort out which ones should actually be preserved and which ones should actually be changed.

So I think that's where we are right now . I think for institutions, because large institutions are still operating under the old system today, they wo n't easily transition to certain things if the technology isn't robust, if risk management isn't very comfortable, and they also don't have responsibilities to their clients and their customers. So it's not easy to break it immediately. So what they need to do is that we actually move more in that direction, but also, please, continue to work with traditional currency, that we can actually innovate actually innovate . Yes.

I saw, did you want to say something? I want to respond because I agree with you, and I disagree a little because I saw it moving a little bit moving a little bit . I won't tell you who is which organization in the group, but, hmm, there's something interesting here. This is the boundary between trfy and defy, the retail world and the institutional world; she is moving. And some of the bunkers in the institutional, um, saw that, um, some people are playing with defy now, trying to have their savings in a different way than they did traditionally.

The first reaction was: they said, "Okay, we'll put up regulatory barriers," even now, in the discussion that we're having at Mika, okay, new. But they started trying to say, "We need this offer for our customers, because if we don't do it, maybe someone else will take it someone else will take it ." And I, I, I saw it move a little bit. I don't know, but, it's moving a little bit , and it's moving with a very large, um, institutional. So I agree that, and we're also working on that, how it will be, how the value chain is completely transformed.

Uh, when you have, um, intermediaries in the room, they don't want to lose their jobs and their incomes . That's normal, but I think things are moving. And it is also moving because regulators understand where there are certain frictions that can be overcome, and where we can move forward. So maybe it will take longer, but I think it's a year faster than it was a few years ago. Thank you, Sandro.

Yes. So, uh, when we look at what makes a financial institution agree to tokenization, and when we listen to what we just heard, uh, from Nadiya and Sabina, I think it's really important to understand that for a, uh, financial institution, it has to integrate into the current system. We have a pretty efficient system built with a few, uh, some frictions, obviously, that, uh, will be improved. But today you run a core banking system that multitasks and coordinates. And we see these frictions happening in the traditional system with ISO 2022.

With the transition from empty messages to MX messages to MX messages, you can already see these frictions building up over the last decades. Now a new technology comes along , uh, and how do you handle it? This is one of the main issues. How do you integrate this into your system while remaining compliant? Now we can talk, starting with custodians: do you have an established network of custodians and sub-custodians, do they offer custody of tokenized assets?

Maybe they offer for cryptocurrencies, but no, maybe not for risk assets. So now the question is , who is interfering in this? Who can you collaborate with? How can you expand your existing network in a way that still looks efficient, because in the end, honestly in the end, honestly , the math or calculation has to be right. So, there is demand, but there is also internal costs, and that is one of the main issues where we see technology can significantly improve efficiency.

But to get there, we need to put the right pieces together, and that's what's happened over the last three years: we've seen us come together on the DeFi side, the streaming side, to fill those gaps, and also think about what comes after the asset, and then we look at, for example, the lack of money. So we all know from a long time ago know from a long time ago how DVP works. How does this work, uh, with real assets? There are many questions that need to be answered, and this is where we, as the Cordana Foundation, for example, are also actively collaborating with industry leaders. For example, we were a key participant in the development of a risk mitigation system, where we work together with Ava Labs, with JP Morgan, with DTCC.

So we have the D5 side, we had the thrfy side to create a system that those who just named use to solve these kinds of problems that are not non-financial risks. And lastly, Sabina, what did you say, uh, post-trading, right? So, the agreement, uh, it's exactly in that direction. If assets and lack of money are isolated and separated, uh, we're not solving the problem of risk, right? Then, uh, you still have some friction, which is not very acceptable to the bank yet.

100% thank you, Sandro, definitely. I want to ask you, Lloyd, from your perspective, we have the institutional side institutional side , the technology, the infrastructure, the traditions, all of that together, that from a risk perspective, uh, you see that maybe the institutional side institutional side , the technology side, doesn't see if there's something that's missing, uh, I would say, innovation teams always want to build, you know, uh, the way they should, they want to build, and uh, and the risk management team looks at what could go wrong. And I am a father. It just occurred to me. I have four kids and they just want to go outside and play.

They don't see the cars speeding by. They just want to see how high up the career ladder they can climb, but they don't think about what will happen if I fall. So that's what we're really focusing on. I would say that insurance really reduces risk and kind of clears the field so that innovation teams, senior leaders can just continue to build momentum. And what kind of cars or apples can fall on their heads?

What are these specific risks? Do you think these are common risks that the industry or customers may be missing? Well, from a risk perspective, it keeps you up at night. Yes. So from a risk perspective, when I meet with leaders, they think about storage, you know, they think about how do we manage our public private keys?

They are thinking about the failure of smart contracts. Uh, about things like that. And this applies to kidnapping and ransomware. So that's what keeps them up at night. And that's exactly what we do in the insurance business.

We meet with leaders and ask them about their deepest fears. What keeps you up at night? Which could make you go bankrupt, and we transfer that risk from their balance sheet to the insurers' balance sheet. Perfectly. Fantastically.

Okay, let me jump into this me jump into this , because obviously we could talk about this for a really long time, but, um, I want to address that issuing tokens is not the same as creating a market. So I'll start, um, with Sabina. We are pretty well versed in tokenization and asset issuance, but when does a tokenized asset actually become a market that institutions can participate in at scale? I just mentioned infrastructure. I think that's where people are, but of course when you say "at scale," that also again requires progress in legislation and regulation, and then certainly infrastructure, and, um, I think ultimately, you know, what drives institutions to do two things for the organization: either they make more money or they reduce costs.

Yes. So if those drivers are regulated, or you, because, you know, you look at the digital asset space, a lot of people in the traditional, you know, traditional, digital asset trading platform, they already see the benefit there. So they, they benefit there. So they, they , they, they, they, they, naturally, do the distribution, but not everyone sees it, and that's one, one part of the equation. But the other part of the equation is certainly removing friction in the system, um, and reducing costs if possible, you know, in the future.

And that's what a lot of large institutions are actually looking for in this equation. But it has to be right, you have to be able to make money and reduce costs, and reduce costs, and hopefully that's the way it's going, um, so Sandro, if Sabina needs liquidity distribution of institutional assets, what should infrastructure do differently? Um, what you need to do is have the right layers of identification, um, because one of the key elements is getting liquidity. You need access to different places, to provide, uh, there are a lot of flows as we know them today, and you need to be able, in a blockchain environment blockchain environment , a blockchain-enabled infrastructure blockchain-enabled infrastructure , to identify them correctly. Uh, these are, uh, verified credentials.

From our side, when we look at this industry, uh, one key element is VLEI. Uh, most of you are familiar with LEI, which is an established identifier. So instead of creating new identification standards that are not accepted by the market, use what we have. We have a standard set up with VLI that works very well, and we've done a couple of reporting demos with Grant Fornton where they ran an on-chain at the station backed up by VLIS, uh, to make it verifiable in our financial reporting financial reporting . This is included in the reporting.

That way, you can create transparency that can be verified, and that way you create trust and, uh, accessibility. So uh, accessibility. So , we need to have a proper environment where we solve some fundamental problems, starting mainly with identification and, um, accessibility, because as I mentioned earlier, we are not in an isolated environment. Because now we see that many have built these solutions, um, in a private environment, um, that cannot allow, for example, moving an asset to another, um, environment, and when we build our isolated solutions, we find ourselves, um, in the wilderness. Therefore, compatibility is incredibly important.

It is this interoperability and this public infrastructure that needs to be opened up, but also secured in a way that we maintain the control that we heard about earlier. And, um, there's been a lot of, um, great, um, developments in recent years, and we're seeing that build up among associations and also from a technology perspective, where we're seeing that programmability in the network is something that's going to allow, um, to create whitelists and a lot of other things that, you know, have an asset on the same chain. Hmm, but it's actually possible, if it, uh, meets a certain condition, uh, to make a transaction in another environment. Many of these things, uh, are critical and are being developed and released right now. So, uh, we're very close to solving this issue.

Perfectly. Thank you. What do you want to say? This may be a pointless question, but as it increases, one might think that the risk increases, but does the risk necessarily increase? Do you understand that as things grow, as they scale, there are different risks, or does the fact that it's becoming more balanced in the industry and ecosystem reduce the risk?

Yes. Uh, with market scaling market scaling , with greater liquidity, volatility decreases, but risk does not disappear. It just seems to migrate. Uh just seems to migrate. Uh , I'm really sorry, I think that with regard to children, you just have more children on the playground, so people have more opportunities to trip.

But what I do in my role is, uh, put in place protective measures. We put up handrails put up handrails , we put out mats so that, you know, one trip doesn't bring down the whole market. Yes. And I think, using the same analogy, if there are more kids on a playground, maybe more kids will pick them up so they're not lying there alone. Yes.

That's right. That's right . Hmm, I want to look at the full transaction, and now I'm looking at the one related to money. Hmm, let's take the same transaction... the same transaction...

Well, actually let me start with Sanders. Let's say we went through, um, the Hope institution. has a viable viable market, ahem, around the asset. What else needs to work before we have a full institutional transaction? I didn't catch the whole sentence, but I know I heard you in the back of the room, sorry about Sandra, so I'm just saying that we're looking at, actually, you know what, let me go to Matija, because we didn't...

we did n't engage you at all , I just didn't hear... No, I was just asking Sandra in his sense, " Once you have your side, you have the customer, you have the institutional side institutional side , um, where does the money fit into the infrastructure?" So, just looking at you, and then we'll bring in Mathieu. " bring in Mathieu. " Sorry, I didn't hear."

"I... I'm Sorry, I didn't hear." "I... I'm sorry." Good.

Um, yeah, I think I mentioned that a little bit earlier, didn't I? So, this is the important part where we move to this DVP model where we have Cashlac that is properly integrated, or at least needs to be synchronized. And we saw exercises in Germany where it worked very well. Uh, someone who did that was Cash Link. We see projects, uh We see projects, uh , globally, called Agora, where we see this intersection, where, uh, central banks are involved.

So the question will be what's on the other side, is it a stablecoin, is it a CBDC, or what type of, uh, digital money is there, and how does that, uh, work, uh, on the reconciliation side, as we've heard before. So as we've heard before. So if I settle this asset and the cash shortage, uh, is delayed for two days, I'm not solving the problem, I'm creating the problem, right? So, uh, it has to be, uh So, uh, it has to be, uh , seamless and fully integrated fully integrated , and, uh, that's where we're seeing a lot of progress these days with stablecoins. Uh, there are some concerns from, uh, central banks that are communicating with them, uh communicating with them, uh , about this.

Uh , about this. Uh , but also we're getting back to wholesale CBDCs or maybe also, uh, tokenized bank deposits, which is a big topic to address this issue right now. And there we also see, uh, several initiatives around the world, uh, that are coming closer to this, because ultimately, again, it needs to be brought together. Ideally. I think this is a good moment to suggest to Matija to sort out how all this happens and what happens to you at the calculation level, what you have to ensure that this works in the real world from a money perspective.

It's, uh, an interesting journey because if you think about what's been happening over the last few years, we've seen demand from crypto players to allow their customers to spend their balances. And the first thing we did was allow crypto allow crypto cards, but ultimately customers were still sending us fiat money. So transactions and calculations happened exactly the same way . And from Visa's perspective, we saw a reason to agree to tokenization because we saw real demand from customers demand from customers . And these clients were asking if I hold assets in stablecoins in digital assets, like why can't I just send you digital assets?

And that was the first step we took towards, let's say , the second step. The first step was to allow, let's say, the concept. The second was to actually allow these customers to make payments and transfer money through stablecoins. And today we are experiencing a pace of about 20 billion in the world, which means it is happening, it is real. And the way it works is that a bank or a financial institution can settle a transaction in Visa in stablecoins, or we can send stablecoins to the acquirer when it comes to, um, settling these positions with them.

The question is, where is the value? And there is, let's say the value? And there is, let's say , value in the ecosystem of actually allowing customers to hold a position in the world of digital assets, instead of having to revert to fiat currencies. And we also see the possibility of, for example, some evolution of the main banking rails, because today we can't transfer money on weekends. What happens weekends.

What happens if there is a bank holiday and thanks to stablecoin payments we can actually address some of these needs? So we're not necessarily deciding who the winner or loser of the technology is, we want to ensure that customers have the opportunity to resolve this position with us. So, going back to your point, we need to solve a problem for a real need, and if there is a real need, then companies and organizations will try to find a solution. Just to be clear, because we discussed this recently. So, you still operate on a fiat currency basis, but you will accept and transfer stablecoins, US dollar stablecoins.

We allow both options. Technically, this is how it works, without going into too much detail about our calculations. Uh, but at a high level, when a bank needs to settle all the transactions that some of their cards have made, they have to send us, let's say, an Excel file that says you need to send us $1 million, €1 million, £1 billion , and they can say, "Oh, actually, my €1 million or dollars, I want to send it to you in stablecoins," and let them do that. Or, if the acquiring bank says, " acquiring bank says, " Actually, I want to receive money from you in stablecoins, because then it's easier for me..." Um, the use case that we think will start to grow is, for example, marketplaces like Spotify or Shopify (not that we actively work with them ), but they need to collect funds and then distribute that money to thousands of creators around the world.

And there is a real option to use stablecoins in a much faster and more efficient way. So instead of sending them fiat money, collecting it, converting it to stablecoins, and then sending it, they can simply receive stablecoins directly through the ecosystem. So these are the use cases that we are implementing. Cool, super cool, do you want to say something, Nadia? Yes.

Maybe in terms of cash league, I think there's a big difference between retail and, um, the institutional world. And I saw that in France and in Europe we are moving very quickly, so there is a discussion about, um, MBDC, deposit token and stablecoins. It's not the same tool, it's not the same regulation. Maybe we also need to have a more precise definition of a deposit, a deposit token, in this part. Uh, but, uh, for example, we're part of the Pontest experiment, and Case Depot, uh, is running a test of this, uh, this summer.

It works very well, so we know how to work. And when I said that it wasn't, uh, it would be different, uh , than we had worked on IT on IT legacy before, it was very easy for the team to work on, and you don't have to launch a very big project to make it work. So that word is also moving, and it will be more, uh, quite, uh, easier to use in the beginning, when we don't have as many, uh, transactions. And now we just need to try not to pit different kinds of, uh, cash part against each other, but to try to have a good part in a good use case, and it depends on the security that you have, the strategy of your company, and so on. And, uh, sometimes I've heard the contrast between a stablecoin, a deposit token, or a CBDC.

I'm not a fan of this because I think we live together and we need to find a way and people will use it or not. I think, uh, Matija said it very well. It depends on the value you create for your customers. Same here, and, uh, if you're contrasting, uh, things and not moving on, then how does that work specifically. So what am I hearing, and I think that's probably true?

On the infrastructure issue, I think it's really, really important, and there's movement that we've seen, uh, in the market. Uh, there are some, uh market. Uh, there are some, uh , FMIs that are really specifically working on infrastructure. We're going to have, uh, a little war on infrastructure, and in the event, uh, we're French, we're European, and we're working on the sovereignty of the European financial ecosystem. And I think sovereignty over the financial ecosystem also depends on what technology you use, and we're really working on that.

Watching what technology the FMI will use, what technology the custodian will use for us, that's really important, and it's moving seamlessly; but that's going to be a huge, uh, goal for the next few months, I think. Yes, I think that's a good point. As you said, this conversation [] is happening [] uh around the world when we talk, uh, with FMI, where it's really about how to move the lifecycle of such an asset, ultimately, onto the chain, because, uh, what we're seeing with the current tokenizations with these benchmarks to SPVs and so on. Hmm, that's, that's something you can do, but that's not really...that's the ultimate goal.

And we see that, uh, we, we're having these conversations, like you said. Uh, that's...I can confirm that, and, uh, it would obviously also help to see how efficiently such a tokenized asset could transact and travel, uh, throughout its lifecycle, but it takes a lot of coordination to achieve that. Both I and the underlying asset need at some point... We don't care what the underlying ecosystem looks like, where it's settled, in what stream, whether it's in stablecoins, CBDC, or tokenized deposits, it doesn't matter, it's the same for you.

Unfortunately, we are running out of time. This has been such an interesting conversation, but that's why I want you guys to wrap it up. I have a question here. If you could remove just one obstacle tomorrow just one obstacle tomorrow , what would be the biggest help in moving institutional tokenization from fringe adoption to real scale? But if you want to answer something else, that's fine.

But if you had one thing you could change from today to tomorrow, it would be changing her. We would scale everything so that everyone could pick it up. I think about it from a US perspective. So I'll just say that regulation and, uh, legislation and, uh, legislation , regulatory clarity , regulatory clarity . Are you okay?

Yes. Usually, I mean, what's interesting to me is , it would be to break down the isolation in these organizations, because this type of technology permeates the larger organization, which, because this thing is pervasive across institutions, where there's one team thinking about one thing and another team thinking about another, and they create synergies in the ecosystem that will make them, uh, adopted at scale. Okay, Sandro. Yes. And I would summarize it with harmonization, uh, which deals with different jurisdictions, technologies, and isolations.

Hmm, this is the only way to achieve our goal. So in my opinion, harmonization across markets and jurisdictions is key, otherwise I would like to see changes. Absolutely. I think we need to think about this process differently think about this process differently . Try a different process, not just trying to do what we're doing now we're doing now .

Uh, if we try, I think we agree on this: if you implement tokenization into your legacy system, you won't change anything. So we need to try a different, uh, process; try to understand how the value chain will move. We know that no, no, some people won't agree with this, but if we don't look at what will change for them, they'll do something like a Kodak effect, and that's going to be the worst, I think. I would agree with many of the points made by previous panelists, if I were to add anything new I think it would be maybe compatibility. And I think that captures a lot of, you know, this fragmentation in the market that makes it very difficult for people to understand.

Uh, and when we talk about fragmentation, there are many types of fragmentation; but I mean interoperability, either between blockchains or between liquidity pools, is something that, uh, if it could be solved with a magic wand, I think it would help institutional adoption. 100%. So, secondary markets, as you said, storage, settlement, interoperability, you know, deletion, fragmentation, harmonization, regulatory clarity regulatory clarity – that's what we need 100% of the time, I think. And then, and essentially, the basic structure is invisible; this is not what we are talking about anymore. So in 5 years we'll be back here and it won't even be a conversation anymore.

Thank you very much everyone. It was really extremely interesting. Sorry it all ended so quickly. Thank you to the audience, and we look forward to meeting you.