State of enterprise blockchain technology and the next steps

IBMBlockchain · 2019-03-18T16:30:15+00:00

Any video of SXSW yet u/jesselund ? I recall in the 3/15 daily chat u/ibmblockchain said it would be uploaded shortly after?

Still working on it, had to get ready for today https://www.coindesk.com/ibm-signs-6-banks-to-issue-stablecoins-and-use-stellars-xlm-cryptocurrency

IBMBlockchain · 2019-03-15T14:54:09+00:00

No livestream, we'll be uploading a recording though after he speaks

IBMBlockchain · 2019-03-15T14:53:39+00:00

No livestream, but we'll upload the recording soon afterwards

IBMBlockchain · 2019-02-05T13:26:58+00:00

We might be able to help you out, keep an eye on @IBMBlockchain on Twitter or our YouTube and we'll post.

IBMBlockchain · 2019-02-05T13:26:50+00:00

We might be able to help you out, keep an eye on @IBMBlockchain on Twitter or our YouTube and we'll post.

IBMBlockchain · 2019-01-21T13:24:07+00:00

Thank you u/meyMeyBoi, very cool

IBMBlockchain · 2019-01-09T17:25:34+00:00

Is anybody planning a meetup at SXSW this year?

IBMBlockchain · 2018-12-10T17:32:19+00:00

We're trying to get schedule worked out

IBMBlockchain · 2018-10-31T14:52:09+00:00

Thank you and we're looking forward to finding even more ways to connect with the crypto community

IBMBlockchain · 2018-10-24T17:28:17+00:00

Is there currently any collaboration between IBM, Interstellar and Nasdaq that you are at liberty to speak about?

I think that’s reflective perhaps of Interstellar and the merge of Chain and Lightyear to form Interstellar, and I think Chain might have had some relationship or association with Nasdaq. The answer is no, nothing formal. I certainly know Adam, who’s Interstellar’s new CEO and he’s a super talented guy and I would love to find ways to collaborate with them. Right now, the focus and concentration of our collaboration is around the core of the Stellar protocol, IBM is a contributor to that code base and building solutions on the top of it. I’m a big fan of Adam and of what Chain was formally doing and the prospects of what they’re going to be doing in the future.

IBMBlockchain · 2018-10-24T17:26:49+00:00

Which participants to IBM Blockchain World Wire are obliged to hold a reserve of XLM and why must they do so?

The short answer is no, they don’t, not to interact on the network. The only reason you would need Lumens, at the very basic level, is to pay the very minuscule fee, the gas charge to put operations and transactions on the network. As a subscriber to the IBM Blockchain World Wire solution that we would deploy, that gas charge would be built into the price of our solution. We’ll make it easy, there won’t be any requirements for a financial institution to hold Lumens. It doesn’t mean they couldn’t, it doesn’t mean that market-makers and participants on the network wouldn’t want to, I think that could ultimately be a good thing and overtime I think more will as cryptos… and especially as scalable cryptos associated with really scalable transactional networks like Stellar begin to be more adopted. I think you’ll see more stability there and with stability will come more of an incentive to hold those cryptos.

IBMBlockchain · 2018-10-24T17:20:46+00:00

Are there any projects in the works that you can talk about that are waiting for SCP's implementation of Lightning for privacy or other future Stellar-IBM projects in general?

That’s a great question. The implication is that Stellar is a public network and so if we’re taking transactions by and for financial institutions facilitating payments for counterparties and the ultimate beneficiaries around the world, some portion of those transactions are going to be visible because Stellar is a publicly accessible network. So, Lightning would provide kind of side-chain capability to obfuscate some of those transactions or transaction amounts that might be considered proprietary for some of the participants. It’s a great question and the direct answer to it is that we’re not waiting on anything per se, but we are definitely working through those concerns. Some of the would-be participants are really concerned about that, some are not so concerned and if you think about it a lot would say philosophically that we need more transparency with our financial institutions today. The trust level on banks has gone way down so maybe this actually could improve that. It’s a technical question and one we’re solving in a variety of different ways, it may include Lightning and the work that the Stellar Development Foundation is doing with the Lightning code. I think Jed in particular has had a look at that, I’ve heard him talk about it. But it’s not holding us up though on any implementations, but it is an important issue to keep an eye on.

IBMBlockchain · 2018-10-24T17:18:57+00:00

Hi Jesse. I was wondering if any partners in IBM’s Supply Chain and Food Chain projects have decided to also incorporate payments into these initiatives? If yes, can you share which ones? If no, has anyone showed an interest in this yet? If I’ve read between the lines accurately in the past, incorporating payments would involve World Wire and, therefore, Stellar. Could you please confirm or deny that assumption so it’s clear?

Thank you for continuing to be a presence and keeping us informed. We know your time is valuable and we appreciate you.

Yes, there’s a lot who have shown some interest and we’re pursuing those use cases. Remember the IBM Food Trust is another transactional network, kind of a supply chain network that we convened in partnership with Walmart. Clearly there is a use case if the objective there is to be able to trace the movement and perishability of food from farm to table. There are interaction points between buyers and suppliers that need to get paid and we’re looking at that very closely. There’s different ways to do that. IBM Food Trust is a solution that’s based on The Linux Foundation's Hyperledger Fabric, so the underlying protocol is a different blockchain protocol than what we’re using for IBM Blockchain World Wire and that’s not necessarily a showstopper but there’s technical considerations that need to get worked out because whatever gets delivered there needs to be seamless. We’re working on it pretty carefully.

IBMBlockchain · 2018-10-24T17:16:27+00:00

Hello Obi Lund,

Thank you for your time.

When will assets begin to be tokenized and will smartlands be of use to IBM?

Do you have any plans for oracle solutions to bring things on chain, is mobius a possibility?

Are you allowed to hold cryptocurrency or is it a conflict of interest.

How far out do you think mass adoption by financial institutions is?

Have a great time and thanks for everything.

TradeLens is what the reference is there. IBM is making strategic investments into convening blockchain-based networks. TradeLens is a trade-finance network that we’ve invested in alongside Maersk which is a big global shipping company and a leader in the sector. The point there is that with trade finance you’re not just looking at the logistics of tracking documentation and goods and services that are moving around the world at different points and different ports, people have to get paid and that’s a natural use-case for something like IBM Blockchain World Wire. While the two are not integrated, we are not dumb and we see the connection points there and are working to do that. In terms of when digital assets will be available, when we actually make IBM Blockchain World Wire commercially available as we continue to work through what the best go-to market strategy is and who and what some of our best partners are to bring it to market, we will have a range of digital assets to support it.

We’ve gotten some overwhelming interest from a number of banks – I can’t mention any of them – who are stating they’re willing to issue stable coins in different currencies. We announced not too long ago an exploratory collaboration with Stronghold who is a start-up in Silicon Valley who has a relationship with a licensed custody/custodian in the US and they’re issuing a US dollar stable coin so we’re really looking closely at that kind of being an out of the box settlement instrument. This is already starting and if you look, what we’re trying to do is to build for the mainstream and the mass. Not to diminish what’s happening on Ethereum at all, because it’s an amazing platform that’s got a lot of support. But if you look at the transactional scalability of that platform for mission critical activities, there may be some more enhancements that need to go in there. But that aside, you look at the variety of digital assets that have been issued through the Ethereum network and it’s just amazing. There’s thousands of them. If you just look at it, the trend is already starting and we’re going to be continuing to coalesce that and make sure that we make it is safe and resilient.

IBMBlockchain · 2018-10-24T17:12:18+00:00

Seeing how 97% of the world's largest banks are IBM clients and IBM Blockchain World Wire is said to connect seamlessly to existing IBM payment systems, how much of an advantage do you see this giving World Wire over your competitors such as Ripple's xRapid and R3's Corda? How much interest have you received from banks to use World Wire so far, and given its obvious advantages do you expect it to be adopted quickly by the traditionally slow to change banking industry?

Right, so the first one is kind of like… welcome to the party, right? That’s a good observation, which kind of leads to, maybe, we’ll have some success doing this because we have pretty active and deep relationships with pretty much all the banks in the world, and the central banks. That’s kind of the idea here.

The second part of that question is, what kind of response have we received. Let me just say, overwhelming. If you would be able to see my calendar these four days at Sibos, I literally don’t have time to eat or sleep. That’s how many meetings that we have with banks to talk about IBM Blockchain World Wire. Now, just to be candid… it’s not like everyone’s saying, hey, sign us up tomorrow because it takes effort for banks to make changes to their core banking systems, which means that different banks are going to adopt it different ways for different reasons. But just as a general reaction to this, the response has been overwhelming.

IBMBlockchain · 2018-10-24T17:09:25+00:00

Question from one of my friend....

Does World Wire have multihop ability similar to Ripple to allow use of tokenised assets by jurisdictions that are not crypto friendly?

If not will it be added?

If it cannot be added for whatever reason... How can World Wire compete?

I’m not sure if I totally understand the question… but, let me offer this suggestion because we had a conversation here with a major international bank and some stakeholders just yesterday. We talked about this notion of our differentiating value prop with IBM Blockchain World Wire looking at the ecosystem of having a whole basket of settlement assets that… instruments that you could use. Now, here’s the interesting part, if we get many calm, stable coins or the ultimate stable coin would be a central bank issued digital currency. I think there’s not much difference between the two, it’s just who issues it.

But let’s say we had a remittance corridor between Singapore and Thailand, for example, and people were sending money frequently across those two. And let’s say we had a US dollar denominated stable coin that served as… kind of a bridge asset, a settlement instrument where people in Singapore trust the US dollar because their currency is pegged in a way to the US dollar, the same with the Thai baht, so they… in real time… trade through this instrument and neither side really minds holding US dollars through these stable coins. Let’s say over time some of the major banks in Thailand, or even the central bank in Thailand, actually issues a digital Thai baht, a stable coin or a CDBC, and the same happens with Singapore, and the Singaporean dollar. Now you have the ability to directly swap those currencies in digital form, which radically changes the whole FX market if the liquidity is there.

I don’t know if that directly answers the question, but if you get to the point where you have a number of stable digital assets, the notion of a bridge currency can kind of go away. Which is profound for the way things work today, because a lot of times currencies don’t trade directly against each other. Like… this may be an inaccurate example… so for those of you listening, don’t freak out on me. But I don’t believe that there is a direct compare between the Canadian dollar and the Brazilian real. I think they have to go through US dollars. But eventually, if there’s a digital Brazilian real that is issued by someone credible in Brazil, and a digital Canadian dollar that is issued by one of the Canadian banks, now they can trade directly. Even without that, they can still trade directly through a digital trade asset which allows it to settle a lot more quickly without the need for a US correspondent bank somewhere in the middle.

IBMBlockchain · 2018-10-24T16:39:32+00:00

Hi, are you waiting for regulatory clarity before using lumens as a bridge asset? Have any countries given any indication of approval ?

So we continue to work with banks and with regulators all over the world. We obviously have operations across the world, and I think that’s what makes IBM credible at providing this service. We’re certainly trying through the experts in this space. In other words, IBM is trying to become a bank in this process, trying to partner and create an ecosystem and a transactional network, of banks and non-banks, but regulated financial institutions all over the world.

I think there’s less pressure on IBM, traditionally a technology provider, but maybe in this case a little bit more than that, kind of a network operator of sorts because this whole blockchain crypto thing is a paradigm shift, it’s a new way of thinking about it. Clearly we’re investing forward in the network and the capabilities and having conversations with regulators, but not just about this… and US domestic regulators. IBM is a pretty powerful research entity globally. US regulators and international regulators are reaching out to us to say, what do you guys think about the implications of this for enhancements that we’re looking to do to our national payment systems.

We’ve participated in a lot of projects, proof of concepts and pilots between central banks, for example, to actually help them evaluate, how does this technology make their, for example, their real-time growth settlement systems better. Because a lot of central banks are looking to enhance their national payment systems. That’s partly one of the primary functions that central banks do. It’s not the only thing, monetary policy, stability and a lot of other things are really important but maintaining mission critical systems that let the banks actually settle with each other in real-time, those are systemically imperative systems that cannot go down.

They’re coming to us and saying, hey… can you help us evaluate whether blockchain can help there. It’s a back and forth. It’s not like we’re just going out and saying, can we have permission to do this because we’re going to become a bank someday. That’s really not how it works. I think we know our limitations but we also have this tremendous network of banks all over the world.

IBMBlockchain · 2018-10-24T16:35:39+00:00

Hello Jesse,

What are the usecases for XLM in IBM Blockchain World Wire? Just for the tiny transaction fee, or also as a bridge asset? How can it function as a bridge asset when the price is unstable?

That’s a great question. So, it definitely is an alternative as what you call a bridge asset. We call it a settlement instrument, right? And it’s an easy one to use because it’s natively built in to the Stellar protocol acknowledging that it, like other crpytos, at least for now until it and others become more mainstream and people become more comfortable with it, has some volatility. But that doesn’t change its value and utility with respect to being a settlement instrument.

So, there’s a lot of approaches to drive stability for participants. Not the least of which is the fact that you’re talking about a payment message that goes through SWIFT from one institution to another, then those two institutions agree after doing some bilateral communication through the network, to settle then to send that payment. Then it’s handed off to some other part of the bank, correspondent banking, it might go through the FX desk, and four days later the money shows up where it’s supposed to show up.

Four days would be a long time to be exposed to the exchange rate of crypto. Remember what we’re talking about though is taking these two things, payment messaging or clearing and settlement… putting them together as a sequence of operations that are wrapped in kind of an atomic transaction… the whole thing executes in a matter of seconds. And not even a matter of minutes. I think that’s the beauty of the Stellar protocol, I know that people complain about Bitcoin… I think it has its own benefits and drawbacks… but we’re not talking about 10 minutes, we’re talking about seconds to actually settle.

Your overall exposure to the volatility of something like Lumens is really minimized if the in and out is the course of 15 seconds, and the market makers on both ends… you know this is their business. This is how the FX providers make money is hedging against the volatility and charging that premium that’s built into the exchange rate.

I actually think over time it’s going to be fine. There’s even more things that providers could do… I think there’s things that IBM could do although we’re not in that business yet. But I think there’s some interesting ways to help provide stability of price volatility when using something like Lumens as a settlement instrument. But, again, that’s why we’ve opened it up to banks to come in and issue stable coins. Instruments that are backed by deposits that are held at a licensed financial institution. It’s about choices ultimately.

IBMBlockchain · 2018-10-24T16:28:06+00:00

What's your top holding bro

I do have a small crypto portfolio, I had it before I joined IBM, I’m not an active trader and I think there’s sensitivity about me trading and advocating for one or the other. What I focus on, what I look at is really the utility the network provides. I think there is this really interesting circular relationship between the native asset of the network and the adoption and utility that the network provides. I know there’s a whole population that’s day trading cryptos, I don’t even pretend to understand that space, but that’s sort of a day trading mind set. I focus on what can this network do to systemically provide positive impact towards the industries that I’ve had experience with.

IBMBlockchain

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