Blockchain will drive transformation for businesses across multiple sectors, particularly for the financial services. It will simplify banking by increasing the quality of offered products & services and radically Speed up bank processes. The results are improvement in the efficiency of the KYC / AML process, cutting the middle man, performance of fast payments, instantaneous settlements and enablement of execution of smart-contract for insurance. ELCA will be presenting concept and use cases that can be used by financial services for more innovation.

1. 10th RICHMOND FINANCE SUMMIT
10th RICHMOND
FINANCE SUMMIT
BEAU RIVAGE PALACE LAUSANNE
5 – 6 OCTOBER 2017
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2. 10th RICHMOND FINANCE SUMMIT
How blockchain will drive
innovation in financial services
Nagib Aouini
Head of Cyber security / Blockchain
strategist
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ABOUT ME
• 20 years experience in Security & Digital ID
• Works for government for large ID program
(French biometric passport, Biometric ID Card )
• Early adopter of Blockchain technology since
Bitcoin exists (2008)
• Blockchain advisor for fintechs, banks and
startups (Assist in ICO and securing smart-
contract and wallets)
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WHAT YOU WILL LEARN
• What is Blockchain
• How it works
• Why it works
• Where it works
• How it might impact you
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WHAT YOU WILL NOT LEARN
• How to invest or mine in Crypto-currency and make
$1Mln in a day
• How to invest in an ICO (Initial Coin Offering) and
make $10Mln in month
• How to buy and sell a unicorn fintech startup and
make $100 Mln in a year
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IS BLOCKCHAIN FUTURE OF BANKING ?
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INNOVATION IN FINANCIAL SERVICES 1.0 AND 2.0
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WHERE FINANCIAL SERVICES IS MOVING ?
Selling
Sold via
Processes
Delivered
Values
Scale
Until 1980s 1980’s until now Next and coming soon
Services Products Smart-contracts
Relationships Electronic platform Robo and Chatbot – AI
Manual Automated Smart-contracts and
Robot AI
In Person / Phone Internet / Mobile Home (via Drone), AI,
Mobile
People Technology AI and Robot will take
care
Linearly Exponentially Only future will tell
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IS STILL INEFFICIENT TODAY
Source : Getting from Hype to Reality, Cap gemini
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WHERE WE GO
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WHY BLOCKCHAIN IS PROMISING ….
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FINANCIAL SERVICES 3.0 IS COMING SOON
INNOVATION
AUTOMATION
DISRUPTION
TRUST
Eliminating middlemen & frictions (cost & latency),
FinTech investment, impact and Convergence, Industry
Redefinition, Destruction of traditional operating models,
Restructured Value Chains, Redefinition of Customer
Financial Inclusion, Connectivity, Collaboration,
Commerce, Smart Contract
Internet of Value, P2P, Blockchain / DLT, Smart Contracts,
IoT, Machine to Machine Economy, Artificial Intelligence,
Machine Learning, Predictive & Prescriptive Analytics
Rebuilding Trust with Protocols not People or
Institutions, Eliminate The Middleman, Full
Transparency, Trustless Transactions, Trusted Staff and
Partners
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• No middleman
required.
• Do your Fraud
detection yourself
• Sufficient trust for
the value of the
transaction
• Anonymous/Private
• Distributed
EXCHANGING VALUE TODAY

14. 10th RICHMOND FINANCIAL INDUSTRY FORUM
• Requires 3rd party
trust
• The more complex
the flow, the more
middlemen required
• Specialised
equipment needed
(e.g. POS terminal,
connection to Txn
networks
• Fraud detection by 3rd
parties
• Every step adds cost
ELECTRONIC PAYMENT TODAY
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TRADITIONAL LEDGER DISTRIBUTED LEDGER
• Rely on central authority to
generate trust and transfer value
• A central counterparty records the
transfer to prevent cheating
• Costly, time-consuming and
duplicative reconciliation by
participants
• Trust come from the network itself rather
from the status of a central authority
• Participants validate changes
collectively, and changes are updated
accross the network almost immediately
• Speed up transaction times, improve
transparency and reduce costs
LEDGERS
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16. 10th RICHMOND FINANCIAL INDUSTRY FORUM
Blockchain Revolution
Don Tapscott
“With today’s internet of information
you can’t store, move, transact
value without a powerful
intermediary. And that’s what
blockchains solve.”
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Blockchain is a distributed network of value
• Internet gave us a
powerful way to share
and access information.
• Blockchain now gives
us a powerful way to
share and access
value.
INTERNET OF VALUE

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• Public – not owned by anybody
• Constantly synchronized – no
double spend
• Not stored centrally – no central
authority,
• Consensus e.g. via proof-of-work
• Each node hosts a copy of the
ledger
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HOW BLOCKCHAIN WORKS
Blockchain is replicated on peer-to-peer
network of computers

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HOW A TRANSACTION IS EXECUTED
Bank A initiates a transaction
toward Bank B
Node
Node
Node
Node
Node
Transaction 1
Transaction 2
Transaction 3
……
1
2
3
4
Bank B receives the transaction
from Bank A
All transactions are put together
And linked in a block
The block is validated by the network
nodes using cryptographic
techniques
The block added to the blockchain
(to every nodes) and accessible
By all peers
5
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WHAT IS A SMART-CONTRACT
Smart contracts are computer programs that facilitate, verify, or enforce the
negotiation or execution of an agreement. They often emulate the logic of regular
contractual clauses.

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Source : Getting from Hype to Reality, Cap gemini
POWER OF SMART-CONTRACT
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BLOCKCHAIN BENEFITS
Reduce
Fraud
Tampering, fraud
& cyber crime
Verifiable
Through shared
processes and
recordkeeping
Save Cost
Overheads and
cost intermediaries
Save Time
Transaction time
from days to near
instantaneous
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PUBLIC BLOCKCHAIN
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Source : https://www.linkedin.com/pulse/blockchain-enterprise-karthik-ramamoorthy

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RISE OF PRIVATE BLOCKCHAIN FOR BANKS
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Source : https://www.linkedin.com/pulse/blockchain-enterprise-karthik-ramamoorthy

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AND BLOCKCHAIN IS MORE THAN JUST BITCOIN …
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https://www.six-interbank-clearing.com/dam/downloads/de/events/2016/sbof/blockchain.pdf
BLOCKCHAIN
CURRENCY ASSETS CONTRACTS DATA P2P
INSURANCE, FILE STORAGE, VOTING & E-ID, AND MANY OTHERS ...
PATIENT HEALTH RECORD, DRUGS TRACKING, SUPPLY CHAIN
CROSS BORDER PAYMENTS, KYC, SECURITIES TRADING

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WHERE BLOCKCHAIN STANDS IN 2017
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Cryptocurrency Market share exceed
$100Bn with more than 1’000 tokens
Rise of permissioned Blockchain R3, IBM,
Hyperledger and soon Microsoft)
Regulator cannot ignore Blockchain and is
moving to regulate it (ICO warning by US
Securities SEC and China banned ICO)
ICOs (Initial Coin Offering) fund raising
exceed traditional Venture Capitals fund (will
exceed $1Bn by end of 2017)
A lot of startup try to innovate by
creating their own Blockchain (soon will
appear Blockchain of Blockchains !)
A lot of pilot project running with
government, private company (ELCA ☺)
using mainly Hyperledger, R3, EEA.

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RISE OF THE BLOCKCHAIN
Blockchain
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HOW BLOCKCHAIN WILL DRIVE INNOVATION ?
• Banks could leverage on
Distributed Ledger
• Consolidate Reputation
Models to utilize
Blockchain Technology &
Identities
• Adopt Smart Contracts to
automate business
processes
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USE CASE : ENABLING KYC VIA BLOCKCHAIN
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Easy intra-bank exchange Easy intra-bank exchange
Easy verifiability for all
departments of a bank
Customer uploads
documents (POI & POA) Easy accessibility & verifiability
of KYC status by external
agencies
Bank receives
customer data
from blockchain
Verifies &
confirm KYC
status
USE CASE : KYC POWERED BY BLOCKCHAIN
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USE CASE : ENABLING IDENTITY PROTECTION
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WHY SECURING ID IS IMPORTANT ?
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HOW BLOCKCHAIN HELP IN PROTECTING ID FRAUD
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USE CASE : FLIGHT INSURANCE POWERED BY SMART-
CONTRACT
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customerID : 156561
Insurance : Fizzy - Premium
Flight details : AZ34790
Contract
If Flight Delayed <2h then..
If Flight Delayed>2h
If Flight Cancelled then ..
ORACLIZE
Smart contract
On Time / Delayed
SMART-CONTRACT EXECUTION
Flight status
Flight booking
Payout
No paperwork, no claims. Smart-contract automatically
trigger compensation in case of 2h delay
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WHERE BLOCKCHAIN IS USED IN BANKING
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EXAMPLES
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WHAT ABOUT SWISS BANKS
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WHAT ARE YOU WAITING
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QUESTIONS
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