autonomous finance @stanford
TRANSCRIPT
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autonomous finance
tom ding
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we all know software eating the world the new tech middlemen rise as the old fade away
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similarly fintech unbundling banks startups offer better, cheaper and faster financial services “in an app”
source: cbinsights
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… yet banks stand mostly unchallenged
PayPal: 44B
Wells Fargo: $250B
Bank of America $136B
Goldman Sachs $66B
Lending Club
WealthFront
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protected by the great wall of regulatory monopoly
Regulatory Barrier Top of the Food chainFree Money
Wire | ACH | SWIFT
App
fractional reserve
massive bailoutsMoney transmitter
Broker/DealerMSB
Clearinge-Money
Banks
Broker | ClearingExchange
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from 2000 to 2011:
cost of running Internet application went down 100x… but not financial services.
why don’t we just build better banks?
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paypal
nokia
producer vs. middlemen
the fate of dragon slayer <in search of George Orwell in Burma>
uber
AIG
BoA
wealthfront
toyota
gold dealer
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1/ middlemen always maximize rent-seeking 2/ regulatory barrier worsen them 3/ they control gateway to wealth equality 4/ innovation stagnates w/ middlemen
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finance should be part of public infrastructure
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a robotic financial infrastructure which is: unstoppable | tamper proof | democratized
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enter ethereum: the world computer
1980
1990
2000
2005
2010
2015
Ethereum
BitcoinIBM PC
www
decentralized
centralized
aws
bittorent
world’s decentralized file network
world’s decentralized ledger
world’s decentralized computer
world’s centralized cloud of million servers
computer for everyone
connecting world’s computers
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allowing access to global mirror assets
mirror | liquidity AUTONOMOUS FINANCE
TRADTIONAL FINANCE
LOCAL “PHYSICAL”Equities & Commodities
GLOBAL MARKET NATIVE & MIRROR ASSETS
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D-BT
NASDAQ: Apple
D-AAPL
LONDON: BT
D-BOND-1
DTCC: $1.6 QUARDRILLION EUROCLEAR: 633 TRILLION
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makes possible: a global permission-less financial protocol
Decentralized applications /
smart contracts Ethereum world
computerautonomous
finance protocol
developed by string, partners and contributors
controlled by community
consumer | developer | trader
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from banker finance to autonomous finance
autonomous finance protocol
custodianship p2p exchange
p2p margin lending automated market making
bond issuance & collaterlization
DTCC NASDAQ eTrade
market makers investment banks
if autonomous finance available for everyone, what happens?
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1 financial access for everyone, free
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Micro loanMicro
investment Free Remittance
A Freedom 251 smartphone, priced at 251 rupees (less than $4)
3/4 of the world’s poor do not have a bank account, not only because of poverty, but also due to costs, travel distance
and paper work involved.”
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finance 1.0 separate systems, jurisdictions and markets
Broker ExchangeBanks
1970s & Before
5 days settlement
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finance 1.5: industry network monopoly layer upon layer of intermediaries
Transactions increase More intermediaries emerge
Complexity & Customer Costs explode
DTC
E-TRADE NASDAQ
BNY Mellon
NUMEROUS & EXPENSIVE INTERMEDIARIES
Wire/ACH
EUROCLEAR
1980s - 2015
3 day settlement
DTCC: $1.4 QUARDRILLION EUROCLEAR: EUR 633 TRILLION
CommissionSpreads
Interest on Floats Front-running
High-frequency trading
Gated entry-barrier
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2 asset becomes the new cash
001.30 Facebook!VALUE $146.9 Dusd 1.6 BTC
+4.5%
000.09 Gold Ounce!VALUE $119.07 Dusd 0.59 BTC
-1.3%
+! Send! Recv.!
1302.1 DusdAvailable for buying assets
! !
081.17 Fund – Zabel...!VALUE $110.73 Dusd 0.52 BTC
+9.7%
012.23 Google !VALUE $7,704.9 Dusd 32.78 BTC
+0.8%
Programmable & configurable…
Steady interest through margin lending coins
Global stocks & commodities.
Fractional assetsAutomatically spend from your overall balance
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liquid asset wallet blurring the line between asset and cash
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3 public market converging with private market
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Top 20 deals used to be mostly IPOs now they’re almost all private
source: a16z
Under US Securities Act, startups can only solicit and take investments from accredited investors ($1m+ net worth).
That excludes 97% of Americans from startup investing.
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4 everyone’s voice in world financial system
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5 engineer become new bankers
wealth are just “symbolic objects”
Autonomous Financial Platform (inc. global “mirror” D-assets & smart contract API)
I can easily program any financial system using autonomous finance and smart contractsCODE !
REGULATORYSYSTEM ABC
REGULATORYSYSTEM XYZ
EXCHANGENMO
EXCHANGERSV
DARK POOLNMO
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6 new world currency emerge
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autonomous finance launch - q3 2016
What would you like to build on autonomous finance?
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Q&A
https://twitter.com/tomding wechat: tomding1987