This presentation was made at the March 3, 2016 "Disruptive Innovations in Financial Services" Conference sponsored by the Institute for Financial Services Analytics at the Lerner College of Business and Economics at the University of Delaware.

1. Digital Currency Labs Inc. – Copyright © 2015
Unlocking Blockchain’s Potential
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George Samman, Blockchain Consultant & Advisor

2. “In the future, virtually every
function in the world of Financial
Services will be displaced,
disintermediated and
decentralized.”
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3. 3
Copyright © 2016 Scott Adams

5. • Inter-person trade - 150,000 years
ago.
• Rise of Barter.
• Trust became difficult.
• Barter grew inefficient.
A Bit of History
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6. • Development of money, credit,
brokerage, banking.
• Rise of the Intermediary.
A Bit of History
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7. Our technology has finally caught
up with our desire to transact,
without the need to trust the other
party, and without the need for an
intermediary.
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8. “Finance 2.0”
• Internet gave us a powerful way to share
and access information.
• Blockchain now gives us a powerful way
to share and access value.
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9. • Internet based form of currency.
• Borderless.
• Instantaneous.
• Authenticated.
• Non-repudiated.
• Immutable.
• Peer-to-Peer networking; decentralized.
• Can be used real world; payment for physical goods
and services.
It All Started with Digital Currency
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10. • Essentially an online payment system.
• Invented by Satoshi Nakamoto.
• “Bitcoin: A Peer-to-Peer Electronic Cash
System”.
• Released as open-source software in 2009.
• System is peer-to-peer; transact directly without
needing intermediary.
• Transactions verified by network nodes.
Most famous = Bitcoin
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11. Graphic - How It Works (courtesy American Banker)
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12. • Ripple
• Ethereum
• Litecoin
• Dogecoin
• Stellar
• PeerCoin
• Dash
Other Digital Currencies
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13. Over
675
digital currencies.
Other Digital Currencies
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14. • A permissionless distributed database.
• Protocol maintains continuously growing list
of data records.
• Hardened against tampering and revision,
even by its operators.
• No central repository; no single admin.
• Trustless.
• Technically, NO intermediary.
Technology Layer IS Blockchain
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15. 15
Copyright © 2016 Financial Times

16. 16Courtesy – StackExchange

17. • Most secure record-keeping technology
ever devised.
• Every bit of information stored on an
immutable time-stamped list.
• Replicated on servers across the globe.
• Allows for full transparency.
Why Blockchain in Financial Markets?
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18. Distributed
Ledger
Independent
permissioned
blockchain
Distributed
virtual
machine
(Turing-
complete)
Smart
contracts
govern off-
chain assets
Network
achieves
settlement
finality

19. 19

20. Look at what blockchain can do.
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• Beneficial impact on pricing and costs.
• More accurate customer tracking across
borders and banks.
• Reduce risk of defaulters.
• Facilitate fast, efficient, and secure transfer of
digital assets.
- Bonds, Stocks, Futures, Options.
• Digitally 'signing' and time-stamping assets.

21. Cryptographic signing of transactions

22. Look at what blockchain can do.
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• All about making processes simpler and
life easier.
• Blockchain is also a platform that can be
coded and built upon.
• Smart Contracts.
• Asset creation/exchange.

24. Blockchain getting a lot of attention!
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25. Financial Institutions of All Types Getting Involved
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26. • IBM Goes Big on Blockchain Unveiling
Services Suite and Strategy.
• Microsoft Partners With ConsenSys offer
Blockchain platform for Developers.
• “Blockchain-As-A-Service”
Global Technology Firms Involved
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27. • Private or Public Blockchains.
• Sidechains.
• Alternative blockchains.
• Smart Contracts.
• Asset creation/exchange.
• Identity Management.
• Remittances.
This is Just the Beginning
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28. • Regulators have a deeper understanding
now.
• Not only focused on threats of digital
currency.
• Reviewing transparency as a benefit.
• Ease the burdens of regulation?
• Competitive advantage?
Regulatory Standpoint
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29. Bitcoin Has Its Critics…
MasterCard CEO Ajay Banga:
Bitcoin "starts bumping up against societal
rules, which I worry about…it doesn’t give
me the safety and security of knowing that I
am who I am, and I’m paying who I know,
which is what traditional currency does."
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JPMorgan CEO Jamie Dimon:
Bitcoin "is going nowhere... There is
nothing behind a bitcoin, and I think if
it was big, the governments would
stop it."

30. … Who Seem to be Coming Around
MasterCard invested in Digital
Currency Group; venture firm
that has invested in 65
different bitcoin and
cryptocurrency businesses.
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JP Morgan has:
• Signed on with R3
• Begun a trial project using
blockchain
• Invested in Digital Asset Holdings
• And more…

31. Critics Miss The Point
• Technology will revolutionize how we
transact; how we exchange value.
• Improve money remittances worldwide.
• Better, cheaper, faster payment
processing.
• Servicing the unbanked and under
banked.
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32. 2015 was a transitional year:
• UBS, Barclays, JPM etc launch blockchain
innovation groups.
• ItBit gets Banking Charter license.
• Finalization of NYS BitLicense Requirement.
• TeraExchange adds former head of NYSE.
• Coinbase enables high frequency trading.
• NASDAQ to trial blockchain technology.
• Overstock launches T0 (“tee-zero”).
Developments over the past year
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33. • Bloq, the "Red Hat for blockchain", launched with Jeff
Garzik.
• Bitcoin Price Passes $420 Mark Amid Institutional
Attention.
• Mizuho, Microsoft Japan Trial Blockchain System for
Syndicated Loans.
• IBM and Microsoft supporting open source landscape.
• 7 Asian Banks Investigating Bitcoin & Blockchain Tech.
• China's Central Bank Weighing Blockchain Tech for
Digital Currency.
2016 Has Already Been Game Changing.
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34. Still Going Through Adoption Chasm & Trough of Disillusionment
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35. • Reduced cost of trading.
• Reduced cost of compliance.
• Greater transparency to regulators.
• Smart Contracts, Smart Property.
• Major disruption across a broad range of
industries, not just financial services.
What This Means for Financial Markets in the Future.
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36. The financial markets are changing.
Learn the technology.
Understand the Use Cases.
Reevaluate how our industries operate.
Prepare; it will impact your business.
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37. Thank You
George Samman, Blockchain Consultant & Advisor
Email: george.samman@gmail.com
Twitter: @sammantic
Blog: sammantics.com
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