Veteran attendees of FIA's International Futures Industry Conference in Boca Raton, Fla., are heading home after soaking up some sun and some insights from leaders in the derivatives landscape. One thing they aren't heading home with is an ailment that has infected financial services conference far and wide for the last few years: Blockchainitis.
Blockchain, blockchain, blockchain is all people have wanted to talk about at previous FIA Boca gatherings. But the blockchain talk was relatively subdued at this year's event; perhaps because FIA opted for quality over quantity when it came to inviting blockchain experts to speak. Digitial Asset Holdings CEO Blythe Masters was one such quality speaker.
Masters’ work in finance was already legendary before she took the helm of Digital Asset two years ago. At the time, Masters was just the fourth employee at Digital Asset. The firm has grown quickly to include 100 employees in locales like New York City, San Francisco, Zurich, Budapest and Sydney. Masters expects the firm to grow to 160 employees by the middle of this year.
Digital Asset builds secure and distributed processing tools to speed up settlement, reduce costs and enhance security and transparency in regulated industries. The firm’s work developing enterprise distributed ledger systems has not gone unnoticed. Digital Asset has already partnered with organizations like ASX, DTCC, Six Securities Services, Accenture, PwC and Broadridge to tackle efficiency issues. In fact, the potential of blockchain, which is also known as distributed ledger technology, is what convinced her to end her long run at JPMorgan and join Digital Asset. She believes blockchain can solve a number of the performance issues the financial services industry has been facing for years.
While blockchain has indeed been the fintech story of the last couple years, Masters agrees the buzz appears to have died down quite a bit. However, Masters offered an interesting explanation for the relative radio silence: “People have their heads down” working to bring the technology to the marketplace. After explaining and selling the concept for the last few years, blockchain firms are under pressure to deliver.
“Distributed ledger is not sexy,” Masters told the audience at FIA Boca. Masters pointed to the commitments to blockchain being made by companies like Google, Amazon and IBM as proof the technology can be a game-changer. With hundreds of employees and millions of dollars being dedicated to the development of blockchain, Masters expects organic adoption over the coming years by companies large and small.
The sheer number of firms working on blockchain also presents challenges. For example, one question asked of Masters during her FIA Boca appearance centered on blockchain standardization. But Masters says doesn’t expect to see a single blockchain standard. “We all want a non-fragmented solution,” said Masters.“But the utopian version of a single blockchain to rule them all is undesirable and impractical.”
Digital Asset is working with the open source collaborative effort Hyperledger Foundation. The Hyperledger Foundation has 5 projects with more than 120 contributors from across the world and, per Masters, is the most active open source product from the Linux Foundation. Digital Asset Holdings is focusing their collaboration on vendor-neutral interoperability protocols.
Distributed ledger technology is already being put to use in various financial market capacities. In particular, several commodities firms have successfully settled trades using the technology. If more firms using blockchain leads to fewer conference speakers talking about blockchain, then one can hope blockchainitis will go the way of other ailments like polio and small pox and be eradicated forever.
Contributing writer and recovering Blockchainitis sufferer: Shannon Vaughn