GFT @ The European Blockchain Convention
The European Blockchain Convention has long been a hub for blockchain innovation in Europe. In its recent 9th edition, GFT returned as a sponsor, showcasing our expertise in blockchain and DLT. David Creer, GFT’s DLT Global Lead, took the stage to discuss the intriguing topic of ‘Shaping CBDCs and Stablecoins for Consumers and Businesses’. Our team made a significant impact at the convention, with both myself and Richard Dhuny (UK Digital Assets Lead) representing the UK team, along with multiple colleagues from GFT Spain and our partner, targens (part of the GFT group).
This blog showcases GFT’s presence, covers some of the industry updates and trends discussed during the convention, explores the role of new digital assets classes and asset tokenisation, and ends with a few considerations on security, ownership, data governance and privacy.
GFT’s strong presence
This year’s edition brought together global tech leaders, founders, innovators, corporations, and regulators to explore the latest trends and strategies in the blockchain and crypto sector. The attendees had a diverse array of backgrounds, spanning football teams, government officials, banking professionals, decentralised exchange experts, and individual investors. With its unwavering commitment to advancing the European blockchain ecosystem, the convention remained an essential event for all industry players.
With its extensive experience in Blockchain and distributed ledger technology, GFT naturally had a significant presence at the convention.
Starting with our involvement in the Hackathon, led by our very own David Belinchon, where different blockchain technologies were used to build innovative solutions in a really competitive environment. Fortunately, David’s team secured first place in the “Best Web3 Smart Social App with Coreum” category!
Additionally, we were joined by our colleagues from targens, a GFT company with expertise in the fast-growing fields of compliance and digital innovation. targens is also renowned for its highly effective software products, such as:
- SMARAGD Compliance Suite, a specialised software solution for ensuring compliance.
- DLT2PAY, a solution to connect blockchain and DLT networks with established payment transaction systems of banks, allowing payments from bank accounts to be triggered directly from the blockchain or DLT networks
Notably, the company serves seven out of the top ten largest German banks as its clients.
EBC and financial services – industry updates and trends
The blockchain sector has been facing numerous challenges, including a decrease in the value of digital currencies. Nonetheless, significant advancements have materialised within the industry concerning technology, regulation and innovative use cases.
Some of the hot topics discussed during the EBC included:
- New digital asset classes and tokenisation of traditional assets
- Advances in regulation
- Open Finance, DeFi and Web3
- Stablecoins and CBDCs
Banks are adapting, and incorporating digital assets into their portfolios. The value of tokenised assets is projected to continue its upward trajectory. One of the use cases discussed during the convention was Digital Green Bonds, a field where GFT has been involved, pioneering a digital platform for retail green bond issuance, further emphasising the shift towards tokenised assets in the industry.
More regulation is needed, and regulatory bodies are taking steps beyond initiatives like MiCA (Markets in Crypto-Assets, European Union regulation) to address concerns, particularly in the regulation of digital asset custodians. In the United States, the SEC’s approval of the first spot Bitcoin ETF is eagerly anticipated.
A pivotal focus lies in payments and the financial sector, which must take the lead and bring finance onto the blockchain, to then enable broader use cases and Web3 applications. DeFi projects need to address scalability, security and regulatory compliance in order to be successful.
Stablecoins and central bank digital currencies (CBDCs) are gaining ground. Even though volumes in exchanges have dropped, use of asset-backed regulated stablecoins is growing. Also, several governments are now studying and piloting their CBDCs. Interoperability remains one of the key challenges, and a solution like the UDPN (Universal Digital Payments Network) that can empower the future of cross-border payments for digital currencies will play a key role in the ecosystem.
New digital asset classes and tokenisation of traditional assets
Tokenisation is gaining prominence across different asset classes, and commercial banks are actively engaged in the process of transforming securities, bonds, real estate and other assets into digital tokens on blockchain networks. This transition will bring several benefits, such as:
- Enhanced liquidity
- Global accessibility
- Reduced intermediaries
- Smart contract automation
- Portfolio diversification
The digital asset lifecycle, issuance, trading, settlement and custody, is being transformed by blockchain technology, making it more efficient and secure. In this field, GFT is partnering with initiatives like SWIAT, which is aiming to create a single global standard for the processing of blockchain-based securities. This shows our commitment to the future of open finance, driving distributed ledger technology (DLT) adoption in international finance markets. Find out more about this partnership here.
Challenges in this space include evolving regulatory frameworks, redefined ways of ownership and new valuation concepts. In order to bridge the diverse types of digital assets, there is a need to navigate in a shifting landscape in terms of regulatory compliance.
New digital asset services
The emergence of new digital asset classes, driven by blockchain technology, has given rise to a demand for fresh digital asset services to ensure security, ownership, and data governance and privacy. Some considerations include:
- Security: focused on different mechanisms like zero trust architecture, consensus mechanisms, smart contract auditing, and dealing with what information is stored on the ledger. It notes the need for native encryption and the potential to include more data on the blockchain.
- Ownership: custody and the safekeeping of digital wallets. Questions arise regarding know your customer (KYC) and anti-money laundering (AML) responsibilities, with a debate about whether these obligations lie with the blockchain protocol or its operators.
- Privacy: balance between decentralisation and privacy / security is explored, highlighting trade-offs when financial institutions seek private DeFi solutions that remain compliant. Security is considered a native feature, whilst privacy can be achieved through techniques like zero knowledge proofs.
- Data and governance: distribution of governance in blockchain networks, acknowledging that it can slow down decision-making but offers increased user control over data. It emphasises the importance of privacy in enabling users to maintain control of their data as a valuable product.
Applications beyond financial services at the EBC
In addition to financial services innovations, the convention shed light on a wide array of non-financial use cases for blockchain and DLT technology. Engaging conversations revolved around the tokenisation of a multitude of assets, ranging from fine wines and renewable energy to the novel concept of tokenising individuals’ time. This showcased the versatility of blockchain in transforming and disrupting various sectors, extending its reach far beyond traditional finance.
Find more about GFT’s blockchain and DLT capabilities, by visiting our website.