General Partner, Asymmetric
Dr. Alexander Lipton
Global Head, Quantitative Research and Development, ADIA
Co-Founder, Chairman and CEO, Circle
Global Head, Future of Finance, Citi
- Digital currencies will become more prevalent in everyday activities and can be used for borrowing and lending.
- Blockchain technology can create new opportunities in the financial sector, including central bank digital currencies, cutting the fee layer of credit cards, micropayments, and automated foreign exchange.
- Blockchain technology can optimize the processes in the capital markets and enable risk monitoring systems, data trading 24/7, and some front-office operations, thereby moving liquidity and optimization of capital toward DeFi.
- The integration challenge is significant, and technology needs to be supported by regulations and policies to adopt blockchain technology in finance.
- Tokenization is inevitable for efficiency and co-participation reasons. There will be the creation of hybrid physical and digital tokens of NFTs, suggesting the possibility of a thriving economy reimagined in the new era of regional trade flows with a new form of barter.
During the "Growth Opportunities in Today’s Economy" session at Investopia 2023, a panel of industry experts discussed the role of blockchain in the finance sector. The panelists included Jeremy Allaire, Co-Founder, Chairman, and CEO of Circle, Dmitry Tokarev, CEO of Copper, Dr. Alexander Lipton, Global Head of Quantitative Research and Development at ADIA, and Ronit Ghose, Global Head of Future Finance at Citi. Bouchra Darwazah, General Partner at Asymmetric moderated the discussion.
The session opened with Darwazah asking the panelists how blockchain technology can change finance. Allaire noted that digital currencies are helpful in everyday activities and that the market of digital currencies and users will eventually get to billions in the coming years. Lipton added that blockchain could help cut the fee layer of credit cards, facilitate micropayments, and create an automated foreign exchange. He also discussed the need to create digital versions of fiat currencies and the opportunity to use blockchain to build a central bank digital currency. Tokarev stressed the need to find a way to apply blockchain to capital markets and optimize the processes. At the same time, Ghose emphasized the potential for blockchain to create intelligent and programmable bearer instruments.
Darwazah then asked the panelists why blockchain has yet to be adopted on a broader scale in the finance sector. Allaire compared the current state of digital currency and blockchain to the early days of the internet, where initial products could have been more optimal but grew with better infrastructure and software. He said that the third generation of blockchain is being widely deployed, and infrastructure is being upgraded to support millions and billions of users. Ghose added that the main challenge lies in the law, as in many countries, the law is only sometimes up to date with technology, and transactions need recognition.
In conclusion, Lipton predicted that tokenization is inevitable for efficiency and co-participation reasons. He suggested the possibility of a thriving economy reimagined in the new era of regional trade flows with a new form of barter, similar to old banks and settlements. Tokarev emphasized the need to build a new system rather than relying on the old legacy system.
Overall, the panelists provided valuable insights into the growth opportunities that blockchain can provide for the finance sector. While there are still challenges to be addressed, the panelists agreed that the potential for blockchain to revolutionize finance is significant.