Money20/20 Europe roundup – blockchain banking goes mainstream

Money20/20 Europe was a fascinating event, not only because of the excellent handling of COVID but also because of the focus on my favourite conversations: blockchain, crypto and identity. These are certainly topics that institutions, both big and small, cannot and are not ignoring.

There was an interesting perspective from a few participants around how blockchain is the route to customer-centricity. I’d go further than that and say that these technologies and ideas are not only a way to solve the challenges faced by our industry today, but will also help create new ways of interacting with clients tomorrow. We believe the best way to do that is to be very focused on customer problems, and partner with other institutions to use blockchain as a means to deliver value. And it was gratifying to hear quite a few people praise our leadership in this area.

Here’s my blockchain bulletin from a fantastic few days.

How should central bank digital currencies (CBDCs) be designed and what function should they perform to become a trusted medium for payments?

This panel consisted of Central Bankers from the Netherlands, France, and Sweden. All were bullish on CBDCs, citing the need for a substitute to cash (as the use of cash wanes), the benefit for the underbanked (“the process of owning a CBDC will be easier than traditional banking”), and the opportunity to develop the infrastructure of the future that is interoperable with popular cryptocurrenciess or stablecoins that emerge.

However, “it’ll be at least five years before we start paying for coffee with CBDC.” Time will tell but certainly it feels like there is ever increasing focus on this topic globally.

What would cross-border trade with zero intermediation look like?

My session and a very enjoyable one. I think we put on a good show for the crowd here! We had a lively debate and it was great to share the real-world work we are doing at Onyx that supported my views as to why blockchain would transform cross-border payments infrastructure in the next 10+ years.

There were robust responses from Airwallex’s Jed Rose and Western Union’s Massimiliano Alvisini, who focused on the increasing capability of existing rails to make fast payments to a growing number of countries and people around the world.

What would it take to let “Libras” happen and learn from their results?

Another lively discussion, this time between speakers from First DAG (stable coin payments), Azimo (global money transfer), and the European Banking Federation. It took on an “us vs. them” feel, where the believers in a decentralized future shared perspectives on regulators constraining innovation, incumbents moving too slowly and protecting their market shares.

Speakers also emphasized that projects done in silos (especially by incumbents) will not succeed and it is critical to coordinate and build in interoperability.