blockchain payment systems for institutions and central banks

1. Chicago IL, September 24, 2015
Slides: http://slideshare.net/LaBlogga
Melanie Swan
Economic Theorist
New School, New York NY
melanie@BlockchainStudies.org
Blockchain
Payment Systems

2. September 24, 2015
Blockchain Payment Systems
Overview
1
Blockchain Payment Systems:
Like email for money1
Like Skype for money2
(digital instantiation)
Like Apple Pay for governments
(ubiquitous solution, like cash)
1 Blythe Masters; 2 Andreas Antonopoulos; http://www.amazon.com/Bitcoin-Blueprint-New-World-Currency/dp/1491920491

3. September 24, 2015
Blockchain Payment Systems
Bitcoin-FinTech-Blockchain Growth
2
https://angel.co/bitcoin, http://thefinanser.co.uk/fsclub/2015/02/the-fintech-scene-is-so-hot-its-boiling.html
http://thenextweb.com/insider/2015/04/16/bitcoin-is-the-worlds-most-dangerous-idea/
Silicon Valley Bank:
Global investment in
FinTech is set to
double from $10
billion in 2014 to
$19.7 billion in 2015,
and reach $46.1
billion by 2020

4. September 24, 2015
Blockchain Payment Systems
Definition
What is Blockchain Technology?
3
http://www.amazon.com/Bitcoin-Blueprint-New-World-Currency/dp/1491920491
 An information technology
 A software protocol; email (SMTP) runs on TCP/IP, Bitcoin
runs on underlying blockchain software
 Decentralized: each network node keeps the ledger (giant
‘Google doc spreadsheet’ of transactions); blocks (batches)
of transactions posted sequentially to a ledger or chain
 Implication: secure network where any transaction
can be independently confirmed as unique and valid
without an intermediary

5. September 24, 2015
Blockchain Payment Systems
Applications
Evolution of Payment Modernization
4
Electronic Payments Mobile Payments Crypto-Payments

6. September 24, 2015
Blockchain Payment Systems
Consumer Payments
How does Bitcoin work?
5
1. Download software wallet app
 Blockchain.info, Mycelium, etc.
2. Transfer Bitcoin via QR Code / public key address
3. See your transaction confirm, post to the blockchain

7. September 24, 2015
Blockchain Payment Systems
Consumer Payments
Where can I use Bitcoin?
6
http://bitcoinmaps.info/, http://coinmap.org/, https://airbitz.co/

8. September 24, 2015
Blockchain Payment Systems
Enterprise Payments
Reduces Cost and Risk for Merchants
 Vendor payments market
 Reduce 1-3% merchant transaction fee
 Remove hack-able ‘honey pot’ databases
7
http://www.statista.com/chart/1681/daily-transaction-volume-of-payment-networks/
Online Merchants Accepting Bitcoin
Bitcoin Payments Vendors
QuickBooks Software Integration

9. September 24, 2015
Blockchain Payment Systems
Institutional Payments
Current Payment System
1. The central bank: national bank clearing and payments
 Banking clearing and settlement services, depository accounts
 Payment services: collect checks, electronically funds transfer,
received and distribute currency
2. The U.S. government's checking account
 Electronic check and payment processing
 Treasury operations: issue, transfer, exchange, and redemption
of U.S. government securities
8

10. September 24, 2015
Blockchain Payment Systems
Institutional Payments
Blockchain Payment System
1. The central bank: national bank clearing and payments
 Clearing, settlement, compliance, QA
2. The U.S. government's checking account
 Register instruments as smart assets
 Spot (cryptocurrency) and future (smart contract) transactions
 Blockchain payments system, features:
 Immediate recording improves liquidity and risk (T=0, not T+3)
 Secure, transparent, accessible, auditable ledger
9

11. September 24, 2015
Blockchain Payment Systems
Applications
Payments as Access
 Banking services market
 5 bn individuals worldwide and 1/3 U.S.
with inadequate access to banking,
financial, credit services
 Remittances market
 $4 tn global market, 5-30% transaction
fee; immediate funds transfer solution
 Decentralized credit bureaus
 Open-source FICO scores
 ‘Bitcoin MOOCs’
 ‘Kickstarter for literacy’
 Smart Literacy Contracts
10
http://www.forbes.com/sites/ashoka/2013/06/14/banking-the-unbanked-a-how-to/

12. September 24, 2015
Blockchain Payment Systems
Resources
How to get Involved
 Podcasts/presentations
 Andreas Antonopoulos, Let’s Talk Bitcoin
 Local meetup groups
 Bitcoin, Ethereum, blockchain
 Executive Education
 Blockchain University (http://blockchainu.co/)
 Blockchain for Business (http://www.bfor.biz)
 Blockchain consultancy practices
 Big 4 and Strategy Consulting firms
11
 Books
 Non-technical
overview of
blockchain
possibilities

13. September 24, 2015
Blockchain Payment Systems
Overview
12
Blockchain Payment Systems:
Like email for money1
Like Skype for money2
(digital instantiation)
Like Apple Pay for governments
(ubiquitous solution, like cash)
1 Blythe Masters; 2 Andreas Antonopoulos; http://www.amazon.com/Bitcoin-Blueprint-New-World-Currency/dp/1491920491

14. Chicago IL, September 24, 2015
Slides: http://slideshare.net/LaBlogga
Melanie Swan
Economic Theorist
New School, New York NY
melanie@BlockchainStudies.org
Blockchain
Payment Systems
Thank you! Questions?

15. September 24, 2015
Blockchain Payment Systems
Gartner Emerging Technology Hype Cycle
14
http://thenextweb.com/insider/2015/04/16/bitcoin-is-the-worlds-most-dangerous-idea/
Cryptocurrencies added July 2014