May 23, 2023
Five Takeaways from SALT NYC
Casper Labs was well represented at SALT New York last week. The annual event, which brings together business leaders, policymakers and academics, touched on a wide range of topics impacting finance, technology, public policy and more.
Blockchain adoption was a popular theme throughout the event’s two full days of programming, with a specific focus placed on the growing realization among organizations that “blockchain” and “crypto” are not synonymous terms. Where past discussions on the former would invariably gravitate to the latter, conversations this year were increasingly focused on how organizations are creatively employing blockchain technology to drive new efficiencies that had zero to do with crypto, from track and trace supply chain solutions to financial tokenization initiatives, and nearly everything in between.
There’s a growing recognition among business and government leaders alike that blockchain is less about innovation for innovation’s sake; instead, it’s being recognized as an additive tool that is streamlining processes to save time and money on the bottom line. Like the rise and widespread embrace of cloud computing before it, blockchain will rarely (if ever) be the focal point of the solutions it powers – how often do you hear a business screaming, “WE’RE BUILT ON AWS!”? – but it will play a critical role in enabling new economic output and services. Just as AWS and other cloud infrastructure providers have made possible now-ubiquitous services like Netflix, Airbnb and Uber, blockchain solutions are ushering in a new wave of the digital economy.
With the above in mind, here were five, key takeaways from SALT NYC:
- More than a pipe dream: financial services organizations are already tokenizing $700B in trades. Financial tokenization initiatives are well underway in the financial services sector and beyond – and initiatives are getting more ambitious by the day as the efficiencies gained become clearer. From real estate and mortgage to venture capital, it’s projected that more than $16 trillion initiatives will be tokenized by 2030 alone.
- When it comes to end user experience, nobody cares about infrastructure. Blockchain adoption isn’t about blockchain. It’s about the efficiencies that blockchain unlocks; for instance, a mortgage lender can shave 150 basis points off of a loan with blockchain, offering a lower rate for end users without sacrificing its own profit margin. At no point in that transaction will the fact that the loan is originated on chain need to come up – nor should it. It just needs to work, securely and at scale.
- Banks want to put more assets on chain – but they need the proper guidance to do so. Banks still store more than 70% of their assets in vaults, yet they’re expressing a growing desire to put more and more of them on chain to realize additional value streams – and, perhaps, even 24/7 trading. However, they’re never going to adopt the “beg permission later” posture traditionally embraced by Silicon Valley; they’re waiting on greater clarity from regulators. No regulatory body wants to chase this level of economic value creation offshore; the onus is on the blockchain industry to continue working with and educating regulators on how to realize this in a safe and secure manner. And make no mistake: we have the technology to do so today.
- For a promising framework, look to Singapore, Switzerland and the UAE. Time and again, the topic of regulation came up – and how to avoid throwing the proverbial baby out with the bath water when it comes to protecting consumers from risky cryptocurrency ventures without making it impossible for the many promising blockchain applications being built and deployed today to continue to establish market traction. Attendees almost universally pointed to Singapore, Switzerland and the UAE as models for how to strike the right balance between protecting investors and continuing to foster honest innovation.
- Across the board, organizations are rethinking liquidity. Thanks to blockchain’s unparalleled ability to prove digital ownership and protect copyrights, a vast array of assets that were never considered “liquid” are now being considered just that. For example, think about a firm like Porsche; their patent portfolio’s value exceeds their market cap on most days – and until recently, those patents could never be seen as liquid assets. Thanks to blockchain-powered patent trading marketplaces (like that from IPwe), that is no longer the case. The same can be said of land deeds, art and more.
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