international keynote: future of global finance … · 2019-06-10 · international keynote: future...
TRANSCRIPT
INTERNATIONAL KEYNOTE: Future of Global Finance — Convergence of Blockchains and AI
Juergen Rahmel
Chief Digital Officer, HSBC Germany
Future of Financial Services, Melbourne
The Future of Global Finance6. June 2019
Dr. Juergen Rahmel, MBA
Chief Digital Officer
HSBC Deutschland
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3HSBC
Preface 03
Artificial Intelligence 05
Distributed Ledger Technology (DLT) 09
Convergence 15
Agenda
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4
Preface
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5HSBC
– Emerging Digital Markets
The Future of Global Finance
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Preface – How does it all come together?
Fintechs
and Tech
Giants
Crypto
and
Digital
Currency
Internet
of Things,
Smart
Cities
API’s
PSD2
Instant
Payments
and
Mobile
DLT/
Blockchain
Data, AI &
Machine
Learning
6
Artificial Intelligence
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– AI systems are solving problems based on internal knowledge and learned adaptation to new
situations.
– Such systems are perceived as ‚intelligent‘ if they find solutions without explicitly being programmed for the
solution path.
– AI systems are structured:
– AI systems are different: in their representation and use of knowledge (incl. Learning)
Artificial Intelligence
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What is Artificial Intelligence?
Inbound Capability Outbound
Perception
Recognition
Categorization
Remembering, Reflection and Learning
Decision
Making
Planning
Reasoning
Prediction
Execution
Interaction
Communication
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– AI systems and their relative maturity
Att
en
tio
n c
laim
ed
Time
Maturity of
the TechnologyBusiness Value achievedValue contribution identifiedInflated promisesInception
1-2 years1-2 years1-2 years 1-2 years (Typical duration)
Chatbots,
virtual Agents,
NLP
Optical
Character Recognition
Assisted management
of traditional risks
Assisted
management of
on-demand risks
Structural
Document Analysis
Management of wearables
and IoT data
Image / Video Analysis
Robotic Process
Automation
Biometrics
Intelligent
Document Analysis
Robo-Advisors
Artificial Intelligence
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Applied Artificial Intelligence – Capability view
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Controlling
AI
– Controlling AI –
how to tame the beast?
Artificial Intelligence
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Applied Artificial Intelligence – Control Environment
– Development Controls (e.g. Testing)
– Functional assurance
– Data hygiene
– Follow Values, have Purpose
– Avoid Bias and Unfairness
– Maintain Governance and Best
Practices
– Privacy Requirements
– Preserve Algorithmic Transparency
– Maintain Qualifications of Staff
Regulation
Construc-
tive
Controls
Operative
Controls
Ethical
Controls
10
Distributed Ledger Technology (DLT)
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– Permissioned blockchain & crypto-currencies – there is a difference.
blockchain
private & permissioned
ledgers
Shared ledgersDLT
fam
ily
Perm
issio
ned
blo
ckchain
Underlying technology
Bitcoin and other
crypto-currencies
Distributed Ledger Technology (DLT)
Some background
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– A simplified Block Architecture (Trade Finance view)
Distributed Ledger Technology (DLT)
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Setup of Networks and Platforms
Operating system / Blockchain layer − R3 Corda, Hyperledger Fabric, etc
Network operator
− Consortium governance
− Participant onboarding /
app support
− Common rulebook
− Business model
(cooperative, JV, etc)
Trade
FinanceLogistics Insurance Other Apps
API Layer
Trade Specialist Platforms ERP / Back Office Systems Web Portal
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– Powered by R3’s Corda blockchain technology
– Reduces the time from a Letter of Credit (LC)
presentation to acceptance from 5-10 days to ~ 24
hours.
– Integration with leading electronic bill of lading
providers and their network of shipping lines
– Several successful pilots completed:
– Cargill (May 2018), Reliance & Tricon (October 2018), Rio
Tinto & Cargill (November 2018), Fox&Lillie & China SDIC
(May 2019)
– In 2019 the consortium started launching a live solution
provider on JV basis
Distributed Ledger Technology (DLT)
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Voltron – Global Letter of Credit Solution on DLT
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– Streamlining multinational FX Flows:
– Resulting benefits:
– Consolidated view of forward FX cash flows
– Streamlined Operations, i.e. reduced cost and
– Optimised Balance Sheet
Distributed Ledger Technology (DLT)
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FX Everywhere – Post Trade DLT
Private
Ledger
External ledger of net payments
Currency Cash Flows
HSBC Group Border
Different HSBC treasury and risk
management centers and subsidiaries
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– ‘Next Generation’ Asset Classes:
– Lifecycle events and flows to consider:
– Issuance on a DLT
– Pricing, Trade, Payment and Transfer of Ownership
– Asset Servicing
– Customer and regulatory reporting
Distributed Ledger Technology (DLT)
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Tokenized Assets – Ownership and Trade via DLT
(Digital) Assets
CBDC StableCoinsAsset-Backed
TokensUtility Tokens
CryptoCurrencies
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Convergence
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– Cooperation of Methods
The Future of Global Finance
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Convergence – How will DLT and AI influence each other?
Fintechs
and Tech
Giants
Crypto
and
Digital
Currency
Internet
of Things,
Smart
Cities
API’s
PSD2
Instant
Payments
and
Mobile
DLT/
Blockchain
Data, AI &
Machine
Learning
18HSBC
– Cooperation of Methods
The Future of Global Finance
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Convergence – How will DLT and AI influence each other?
Generate Trusted Data
Act as a golden source
Make ‚hidden‘ flows tangible
Develop new Business Models
Enable Digitization of Inputs
Monitor and Control
DLT/
Blockchain
Data, AI &
Machine
Learning
19
Thank You
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