Digital World: Blockchain And Cryptocurrency



and we're back and we're really pleased to be joined by Michael del Castillo he's the lead business reporter at coin desk which it's a preeminent publication dealing with these sorts of issues regarding digital currencies and the blockchain Michael welcome and thank you for being with us it's a pleasure thank you okay let's take this at a hundred thousand feet yes what's the most interesting thing you're seeing in this space bizarrely the most interesting thing that I'm watching right now is supply chain finance that's different from supply chain management which we hear talked about a lot where distributed ledger technology like the blockchain is being used to prove the origin point and and movement of products so what we're talking about with supply chain finance on a blockchain is being able to simultaneously pay every level of a supply chain logistics of a moving something a product a physical product from one place to another and tracking that well the the the finance aspect of that is actually in the payment so what happens now is if you go to a big factory like Foxconn that is making cell phones they will receive the bulk of the payment for the product and that money slowly trickles down to every layer of the supply chain taking weeks and sometimes months to finally hit the people at the very bottom of the supply chain and we're seeing some interesting work actually Foxconn and p2p lending platform D and Ron are working together to reimagine the way the supply chain finance works so that the lowest level of the supply chain is actually being paid at the same time as everyone else that not only would remove the need for the middlemen that are making money in between each of those transactions but make sure that the people at the lower end of the supply chain the farmers the miners who are creating the raw material that eventually go into these products aren't being forgotten or delayed in payment you know I wonder if that should be we talked about blockchain in general if maybe the moral to the blockchain story or the menthe if you will is getting rid of the middleman or the middle person makes sense really I mean that's yeah about I would agree I think that the the innate understanding of a middleman in today's day and age or at least a couple of years ago was definitely as relates to finance so it was it was a no brainer that the first application of blockchain technology would be money cryptocurrency but there are a lot of other exchanges of value out there that aren't necessarily reliant on money and we're seeing new cutting-edge imaginative applications of this technology to remove middlemen across a wide range of value exchanges yeah I've spoken with people and I imagine you've done stories on this that want to track the movement of diamonds your example right and even some precious metals so there's a number of different applications outside of traditional payment systems let me ask you though we talked about the large financial institutions who really have been and there's nothing wrong with it they've been important to the development of the world the development of our country in the u.s. here serving as lenders but they really are the middle people in a lot of these trends yeah so are they on the defensive with regard to digital currencies or are they do they have some sneaky strategy the where they're going to have some you know internalized banking financial system ledger as opposed to a distributed public ledger which would truly get rid of the middle people great question III think the the big first of all the short answer to question is they are involved they are exploring and there are a couple of instances of them exploring using cryptocurrency publicly which we can talk about but to answer the first part of your question the big difference between innovation that is being explored in the blockchain space by banks and other financial institutions is that they are used to lead the drive towards those innovative products blockchain and crypto currencies is unusual perhaps even unique in the fact that it was driven by the retail world it was driven from the ground up and so in a lot of ways these banks stock exchanges financial institutions generally speaking had their hand forced they were watching from a distance as other people were driving innovation which is unusual but it's it's Minh le er it's it's not accurate to say that the banks are not involved well some of its self-preservation too right I mean they don't they don't want to lose this is a horrible term and I don't mean it in a negative well I better not use lose the source of the revenue so they can provide the financing that is important to our economy they're difficult to talk about because of the fact that their their hands have been a lot of ways been forced to this innovation I think that they were largely content with their role in the financial system and you're right they had to go into this in order to stay pertinent but that's not to say that they aren't also willing participants or at least they haven't become willing participants some of the most exciting cryptocurrency experiments in the world right now some of the biggest banks in the world are in the room while they're happening tell me about those tell me about you think what are the leading financial institutions around the world that are maybe paying a little bit closer attention to this than the others and when I say closer attention I'm talking about they're reaching in their pocket to maybe get their wallet so there's there's two there's two public examples that I'm happy to talk about and there are a lot of examples that are going on behind the scenes that's a great report read those stories a coin desk in the future so the stuff that I can talk about publicly that has been publicly revealed I should say MoneyGram is now using ripples XRP which is a sort of next-generation cryptocurrency that is designed to increase the quiddity between global banking institutions one of the earliest use cases was in cross-border payments generally speaking sending money from one currency to another XRP serves a really a potentially valuable place in doing that by freeing up money that is being stored in different accounts around the world just in case it's needed instead of keeping that money laying dormant places like MoneyGram can can use XRP theoretically to cut out that that middle transit a lake of liquidity essentially it was what you're saying that can be used for that it doesn't have to be it can be in held in reserve and then used to make the transaction and then they deal with whatever the difference between one currency and another currency is and flatten it out and then they get paid a little part themselves there I guess so there there there is still somebody making money in the middle here but it's different than the traditional financial institutions out there there are another one that I think is really interesting is what might be called a sister currency to XR p which is lumen which is the the cryptocurrency that was created by a company that was founded by one of the same people who founded Ripple stellar and and stellar recently announced a partnership with IBM which isn't a financial institution but IBM powers some of the technology on the enterprise level that runs some of the world's biggest financial institutions that was a big deal because IBM had been in the space for a while using what we call non cryptocurrency applications of blockchain which is moving value around another way storing data in a distributed way but not necessarily using an actual cryptocurrency IBM and stellar last year publicly talking about the potential use of lumen was it was a big deal and and and I think that it's it's sort of indicative of the fact that it's not just financial institutions that are starting to become increasingly comfortable like talking about cryptocurrency in public but technology companies as well all right we could talk Michael for a long time but we are running out of time I promised our viewers at the beginning of the show that I wanted to I was going to ask you about the biggest thing out there in this space that we don't know and maybe you'll have to do something you haven't written about there but what do you have for us okay so I think what would what would be most surprising to a lot of people is the degree to which some of the biggest banks in the world are in fact experimenting with cryptocurrency again I have first-hand experience knowing that some of these banks are in the room advising observing learning and reporting back to their superiors about some incredibly exciting cryptocurrency projects will be we will be looking for you we will be looking for Michael Dell Castillo's articles a coin desk and then we can't wait to see them thank you so much for spending was a pleasure Bart thank you take care take care

2 thoughts on “Digital World: Blockchain And Cryptocurrency”

  1. ball and chain
    a heavy metal ball secured by a chain to the leg of a prisoner to prevent escape.
    a crippling encumbrance.
    "the ball and chain of debt"

    a block and chain fo EVERYBODY!!

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