The first part of this two-part blog post outlined challenges for a bank launching a digital asset offering. As a starting point, a financial institution was outlined which, in a first step, would like to enable wealthy private clients to trade selected digital assets (e.g. Bitcoin and Ethereum) in cooperation with an external partner. In the second part, selected measures are presented, success factors are described and key takeaways for the launch of such an offering are highlighted. The contents are based on experiences from projects and discussions with experts.Continue reading »
Selected Challenges & Success Factors for Banks in the Context of Launching a Digital Assets Offering
Various banks have opened up more to the topic of digital assets in recent months and are actively driving forward concept and implementation projects for a digital asset offering or are already offering one. For a successful launch, various fields of action need to be addressed. The basis for the conception, operational implementation and launch of a digital asset offering is to ensure the relevant expertise in the appropriate depth and breadth both in the project team and in the specialist departments involved during the conception and implementation phase, the leap from a project-oriented way of working (Change the Bank, CtB) to operation (Run the Bank, RtB), and anchoring in the corporate culture.
This blog post will outline selected challenges in these three areas of action, present exemplary measures, describe success factors, and highlight key takeaways.
Since DeFi Summer 2020, DeFi applications have become a significant trend in the blockchain industry. However, vulnerabilities of DeFi applications have also been identified over the past 24 months. The third and final part of our series “Decentralized Finance – a Hype, a Threat or an Opportunity for Regulated Financial Institutions?” takes a closer look at recent developments in the DeFi sector (DeFi 2.0) and how they address well-known challenges in the context of DeFi, such as the potential for errors when setting up smart contracts, the lack of incentive structures for investors, or the requirements for investors’ technical and professional knowledge, without compromising the strengths of DeFi applications.Continue reading »
The term decentralized finance (DeFi) refers to a decentralized, blockchain-based architecture for processing financial transactions without intermediaries. we will show in this article why offering access to digital assets and DeFi business models is worthwhile for financial institutions and what challenges they have to overcome in order to provide such an offering to their customers. Based on practical examples, positioning possibilities for regulated institutions will be presented as well as concrete opportunities and challenges.Continue reading »
Decentralized Finance (DeFi) has been one of the dominant trends in digital assets at least since the DeFi summer 2020. Since the summer of 2020, the digital assets community’s gaze has turned towards the possibilities of a decentralized financial ecosystem, DeFi applications have become highly popular and the prices of corresponding tokens have multiplied. Why is DeFi seen as having such great potential and what does this mean for regulated financial institutions? In the next three blogposts, I will outline these and other questions, show different perspectives and provide an outlook on the opportunities for regulated financial institutions in the context of DeFi. To get started, this blog post will outline the functionalities of DeFi applications, present selected use cases, and highlight opportunities and risks in this context.Continue reading »
The topic of digital assets has finally reached the mainstream. The potential for services that make it easier for customers to acquire digital assets is great, but so far only a few financial institutions offer such services. According to the banks, there are many reasons for the lack of a comprehensive offering, e.g. concerns about the value of digital assets, high scepticism regarding money laundering or a lack of know-how in the operational handling of the new asset class. This blog post addresses the last point and aims to show that there are various operational implementation options for a basic digital asset offering for regulated banks.Continue reading »