Blockchain Week 2023 has kicked off in Sydney, featuring guest presentations, an official address from the government, a keynote discourse, and a panel discussion focused on the future of banking and the transformative trajectory of financial services.
Hosted by Dr Jane Thomason, Day 1 of Blockchain Week began with a Welcome to Country by Donna Ingram, a message from Blockchain Australia's Chair, Michael Bacina (who introduced Simon Callaghan as the new CEO of Blockchain Australia), and an opening remark from Dan Chesterman, the Chief Information officer for technology and data at the ASX.
Mr Chesterman reiterated the ASX's commitment to blockchain technology and its CHESS settlements system despite facing several delays since the first stakeholder consultation paper was released in September 2016.
The ASX is set to release an update solution design for the CHESS system by the end of the year which will, according to Mr Chesterman, is still reliant on Decentralised Ledger Technology to facilitate transactions.
Katie Knight, Chief Executive Officer of Investment NSW shared the government's optimism with respect to blockchain and Web3 technology. Ms Knight stated that 50% of all Australian blockchain businesses are based in NSW, and NSW has the highest number of IT grads of any state or territory.
Ms Knight acknowledged the transformative change of blockchain tech in her speech:
Blockchain is already changing how people live and work, and the government wants to be a part of that change.
Mastercard's head of blockchain, Ashok Venkateswaran discussed Mastercard's growth in the blockchain space, having accrued 150 patents with respect to blockchain titles and technology in the past 5 years.
Mastercard is acquiring several entities and producing technologies, such as its new customer verification solution, in the hopes of positioning itself as a major player in the future of payments.
The panel on the evolution of financial services was moderated by Michael Bacina, saw some surprising headline statistics revealed by Sophie Gilder (Managing Director of Blockchain and digital assets at CBA) suggesting that a third of scams and fraud in Australia touch crypto-assets in some form, despite those scams being from a variety of different types of scams, Nigel Dobson (Banking Services Portfolio lead at ANZ) and Howard Silby (Executive, Innovation and Partnerships Chief Innovation Officer at NAB) both agreed scams need to be tackled.
The panelists agreed that blockchain technology is not going away, and according to Mr Silby, there are "high friction customer processes that could be improved using blockchain tech." Mr Silby also believes there will be a "sudden adoption" moment in the future, once the tokenisation of assets and CBDCs are fully realised.
Ms Gilder mentioned the status of blockchain in the banking world:
Blockchain is not yet mainstream but very influential...all major banks now have a digital assets team.
Mr Dobson acknowledged that there is:
potential for blockchain to replace existing centralised systems [with] tremendous operational efficiency
The panel agreed that the "high-growth underserved markets" such as the carbon credit market, illiquid markets or private markets are well-suited for blockchain adoption.
Interestingly, in discussing the long road for mainstream adoption, Ms Gilder mentioned the "power of incumbency" in that there are significant costs associated with overhauling an existing system that already functions and is fit-for-purpose (not withstanding acknowledging blockchain tech may have higher upside).
In discussing the parts of blockchain technology that are here to stay, Mr Dobson stated the infrastructure, specifically for public chains, is "incredibly useful" and that "tokenisation and digital assets are the narrative now". The shift from the infrastructure level to the utility layer is now upon us.
The panel were in agreement that the adoption and development of blockchain technology requires significant government involvement by way of certain and fit for purpose regulation which can frame the parameters through which banks can grow in this space and help ensure crypto-asset providers can secure payment and banking services and help slow scams currently impacting Australia.