Amazingly, Standard Bank is launching a series of events to explore the benefits and risks of emerging technology solutions in the world of financial services. Naomi Snyman, Blockchain Lead at Standard Bank Group, said, “If harnessed correctly, powerful technologies like blockchain can unleash new avenues for growth and revolutionise the way Africans bank.”
However, there is a misconception that banks are scared of, or reluctant to, engage with emerging technologies. “We need to debunk that myth as we harness emerging technologies like blockchain to drive change and improve efficiencies. More importantly, we are unlocking the power of collaboration by partnering with entrepreneurs and individuals on their future journeys,” said Naomi Snyman.
The bank is expected to partner with Blockstarters at the launch of the series on October 11. The first talk is aimed at unpacking cryptocurrencies, their impact and how they can enable the payments landscape of the future. It is clear that entering new markets is daunting enough, but a lack of insight, support and a diverse network can often see good ideas and products failing to get off the ground. In support of this, Naomi Snyman said “We are therefore creating a powerful learning platform that will help businesses and entrepreneurs with great ideas to navigate the complex marketplace. This includes creating market access opportunities but most importantly, building the awareness and knowledge to reduce risk and achieve success.”
As example, with the “storm” over Bitcoin over, it is opportune to kindly analyze the protocol innovation which drove its success while also understanding its shortfalls. “Its intent was to completely disrupt, allowing peer-to-peer transactions to take place without the need of a third party. However, it is really important to make the distinction between cryptocurrencies such as Bitcoin and blockchain. The benefits that blockchain provides are much wider and more appealing than just cryptocurrencies, but that does not mean cryptocurrencies will not have a role to play. For instance, the initial coin offering frenzy may appear to be over, but we need to understand how this can enable new forms of value transfer and payment mechanisms,” said Naomi.
It is also worth pointing to the fact that the Standard Bank noted that South Africa’s Central Bank has taken a proactive stance on cryptocurrencies by creating a private cryptocurrency unit. “The role of regulation is often not well understood when you talk about cryptocurrencies and blockchain, but our central bank has realised it has a crucial role to play as the industry begins harnessing the benefits of a decentralised ledger. A future that may include borderless currencies and cross-border virtual money flows in Africa will need them as a key player,” said Naomi.
“While decentralisation is seen as the ultimate vision, this needs to be tempered by the fact that payments, digital identity or digitisation of assets will need central bank approval and so the ideal model will be based on multi-party collaboration,” she said. Note that the Standard Bank said that it supports both open and permission-based blockchains. Permission-based blockchains add an extra control layer and as thus only specified parties, such as a bank and approved clients, can transfer and validate the network. “There is potential for both of these models as while an open system will drive growth and expand the eco-system, private permission-based blockchain will play a big role as confidentiality of customer data and transactions remains paramount,” she added.