Crypto and blockchain

Crypto and blockchain is the current core area of our work and expertise. Our particular focus is on finance-related crypto applications like security tokens and non-security fundraising tokens, back office reconciliation, and supply chain financing applications. We advise both protocols and other crypto suppliers as well as (potential) crypto users, eg companies who want to raise funds, or established companies like fund managers and private banks in need of a crypto strategy.

Crypto and blockchain is the core area of our expertise and we and many of our partners have been active in that area since back when Bitcoin was at $100. We have a realistic view of what crypto and blockchain technology and also what it can not do. Because of our other areas of expertise and focus we mostly look at financial services applications of blockchains. However this is to be interpreted in a very wide sense and digital identity and supply chain (via trade finance) is definitely within the realm of things we are looking at. A few example projects in this area:

• a second tier private bank wants to understand blockchain and crypto technology and what it means for them and their strategy; we can offer them a full suite of service ranging from executive education where we teach their key executives about crypto and blockchain, over a strategic assessment including development of defensive and offensive strategies all the way to the implementation of a crypto strategy by actually offering tokenised instruments

• a second tier bank considers entering the crypto market by issuing a tokenised certificate of deposit, or in other words a “stable coin”; we can help them work through the strategic parameters of this exercise, including the regulatory implications and hurdles, and also help them issue those instruments should they choose to do so

• a crypto project requires help in the token design; this token is meant to raise funds so regulations need to be taken into account when structuring it; also the tokenomics are important, and last but not least the customer targeting and marketing strategy. We can support them in all those areas, from being a sounding board, to running the entire design process allowing the project sponsor to focus on the technolsogy

• a charity wants to enable capital investment in emerging markets villages, for example for solar power generation, water treatment, or Internet connectivity; we can help them with their financing strategy which could be a mix of donations and investments, targeted both benefactors from big countries plus the diaspora population of the project’s beneficiaries

Our approach with respect to crypto and bockchain is that it is a truly revolutionary technology in some respects, but ultimately it is a software design pattern with advantages and disadvantages. Our approach is therefore to look very carefully how the “blockchain pattern” differs from more traditional database patterns. Key differences are for example Richard Gendal Brown’s “I see what you see” automatic consistency argument, and the existance of a public key infrastructure that can for example completely revolutionise custody by allowing much more advanced degress of self-custody and cross border custody as we argued in CoinTelegraph recently.

We believe that blockchain has great potential and will change things. We also think though that this will not be automatic, and that we will need to work hard to create and grow a value proposition that relies on blockchain’s unique strenghts before we can “change the world”. Also in line with our other core areas of expertise – regulations and finance – we do not think that the core value proposition of crypto is to avoid regulation. Quite the opposite: we believe that it can lead to tremendous changes within the established regulated financial services system. Due to the highly regulated nature of financial services true disruption (in the Christensen sense) is rare so we believe that established players, including current second tier players, who are best at embracing this new technology at the right point in time will ultimately those who win that particular race.