3 Nov - Don’t miss what’s right under your nose, which may be an engineer with the right mix of curiosity and talent, says Leda Glyptis. They are the key to your future. For the last four years, I have had a rough pencil sketch sitting on my desk. Stick figures, infrastructure diagrams and Cupids. In this time, I’ve moved jobs, companies and continents. Yet, this sketch is still to hand, resplendent in bad art, coffee stains and all kinds of creases and rub marks from frequent moves and frequent handling.
It started life as a jovial attempt at explaining to HR what type of person I was trying to hire. It turned my star engineer into a stick figure character building bridges, busting legacy and getting a hug from the Corporate as the latter realises that said star engineer is the key to not just working out the future, but making the future work. Him. Star engineer extraordinaire. Not what he does, not what he knows: who he is.
Taking a step back to take a leap forward
Our banks are complicated beasts fed by unexpected growth and strategic acquisition, not design. Infrastructure came to serve the business, which in turn grew around the point of sale, itself reflecting the client need or at least the market opportunity. As things changed, tweaks were made and complexity was added. We didn’t scrap and start from scratch at any point. We optimised and streamlined, and above all else we specialised. There is hardwired separation between functions in banks. The silos may emerge separating units out by virtue of what they do or who they do it for; slicing functions by business or creating groupings by ‘step’ in a value creation process. Whatever the heuristic tool deployed, separation exists partly for regulatory proposes and partly to get a handle on the complexity of the business. After creating complexity, we added complexity to manage said complexity. Anon. The result is a degree of specialisation so extreme it becomes de-skilling to staff, who often become unable to change what they can only see a fraction of, and process has to trump logic in the absence of adequate information.
This situation is even more extreme in corporate and institutional banking, where such labyrinthine complexity is matched on the client side. That correspondence isn’t accidental – the organisations grew together and the constraints of available technology were common, as were the drivers of profitability. It worked, but there was no science behind it. It was good because it worked, and now it doesn’t really work any more, which means that no matter how good you may be within this setup, the setup is no longer any good.
What’s technically available combined with regulatory trends and increasing market demands means that it’s not your delivery that needs to be revamped: it’s your entire organisation, since it was a vehicle suited to a particular product, a specific delivery discipline, a moment in time. We know that. We are dealing with that. But old habits die hard and we’re still trying to fit change in the same organisational shape, still hiring and managing with the old hat on: looking for ‘fit’, looking for people who can do the job, even as it’s changing, because they’ve done it before. We’re looking for people who can prove they have the technical or product knowledge we needed yesterday, so we can tackle tomorrow. We’re still all about knowing, not learning. I hate to break it to you, but that doesn’t work any more.
Do what no one has done before. Every day
The stick figure at the heart of all this, my then star engineer, wasn’t a star because of what he knew. He was a star because of what he was willing to learn, and what he was able to do with what he learned. He was hired as a Java developer, and started playing with REST APIs in his own time, before it turned out we needed that skill for the day job. He was learning Scala and Kafka in his down time, had a PhD in theoretical physics and was a bit of a film buff. And if you’re like my HR guys, glazing over at this point, then wake up! Because it matters. His innate curiosity and tinkering nature matter. The fact that he’s interested in seemingly unconnected things absolutely matters. The fact that he has a horizon absolutely matters, because in a changing world of emerging capabilities, it’s who he is, not what he knows, that will make him useful to the corporate; his willingness to learn, understand, tinker and observe. Not what he did before, but what he’s willing and able to do next.
Assuming you could find him. Assuming you could recognise the super power. Assuming you manage to hire him. Do you understand what about him makes him valuable? Do you know how to manage him to get to that value?
The star engineer in question once ran regression testing on the colour distribution of candy in M&M packets. True story. The batch number apparently has no impact on how many brown ones you get. It was an ongoing experiment: every time someone in the lab had M&Ms, the data was logged and crunched (pun intended). Once a week, he would run the analysis and observe. It took no more than five minutes a day, but it worked wonders for the atmosphere in the lab. The shape of the questions the young’uns felt permitted to ask. Not just about candy. And that wasn’t even his intention. He genuinely wanted to know how the colour distribution worked, and without asking. He wanted to work it out. That’s the whole point. But every time a client visited the lab, the business wanted the M&M board covered up, and that’s when my stick figures went from joke to talisman.
In a world that’s coming to rely on learning more than knowledge as a survival skill, a business needs at the very least the ability to learn to recognise what it needs to learn in order to survive. M&Ms may not hold the answer to everything, but looking for patterns, answers and paths does. And if you find someone who thinks that way and can cut code, hire them and then give them a hug. Mould your organisation around them, because they will find a way to deal with your legacy and take you into the future. And since they like to learn new things, they will learn how you make money today. And since they like figuring things out, they will play around with how you can make money tomorrow (till they work it out).
As I said: stick figures, infrastructure diagrams and Cupid. Let’s face it. The infrastructure diagrams were for you, to reassure you. They don’t need them. They see the matrix. It’s time to stop seeing the people that hold the key to your digital future as stick figure abstractions with unknowable skill sets, and it’s time to get to know them and let them get acquainted with the guts of the business. The separation of old has outlived its usefulness. It’s in the way of your future profitability. Away with it. Love your engineers. For they shall build the Earth for you to inherit.
| A BANKNXT release written by Leda Glyptis || November 3, 2017 |||
2 Nov - A recruitment agency specialising in finding cryptocurrency and blockchain talent has opened in Sydney. Crypto Recruit has set up shop with the belief that it is the first in the world to offer such niche IT recruitment services, said founder Neil Dundon. “The idea was to get some first mover advantage in the market,” Dundon told Business Insider.
“Nowadays there seems to be general pub talk [about cryptocurrencies] — people are just talking about it all the time and it’s just mental at the moment. So three or four months ago I had the idea: why don’t I couple my passion for cryptocurrency and blockchain… with my skills in recruitment?”
The venture is in its early days so Dundon, who has 13 years experience in the IT recruitment and education sector, is currently busy developing a network of recruiters around the world to find blockchain talent.
But he’s already fielded much interest from the tech industry.
“There really are very few blockchain developers in the world at the moment,” he said.
“There is demand out there at the moment. I’m getting very positive feedback on it. But it’s in it’s infancy stages, so I’m really there to build a brand and help these blockchain projects from a staffing perspective.”
With such a shortage of skills, recruitment for cryptocurrency and blockchain developers can sometimes be a matter of hiring graduates or developers with different backgrounds then upgrading their skills.
And those willing to learn can “make a premium” on top of standard technology salaries, according to Dundon.
“A lot of these projects raised a lot of money from their initial coin offerings and they need to move quickly. So just by the very market forces alone, and the speed to which they have to develop, there can be a premium on top.”
Dondon, who established the Bondi business after becoming a cryptocurrency investor himself earlier this year, already has three employees based both in and out of Australia.
“There’s a whole paradigm shift in front of our eyes and a lot of people aren’t even realising it.”
| A BusinessInsider release || November 2, 2017 |||
1 Nov - Gartner analysts share insights on how organisations can scale in the digital era, but warn not everyone can make it through this change. Digital is already reshaping industries, says Val Sribar, senior vice president at Gartner. But there is a certain point where affected industries drastically need to take action. Once digital revenues for a sector hits 20 per cent of total revenue, the shakeout begins, he says.
This happened to the retail sector in 2005, when traditional stores were in denial about online shopping.
They thought everybody wanted to buy clothes in the stores, but customers flocked to online stores like Amazon.
Today, Amazon is the largest clothing retailer in the United States.
For the clothing industry, disruption is the new black, says Sribar, speaking at the keynote this week at the Gartner Symposium/ITxpo in the Gold Coast.
“This lesson in retail applies to every industry everywhere,” says Sribar. “Twenty per cent is the point of no return.” He says winners are alreading emerging, but some organisations will not make it through the digital shift.
The new competitors and disruptors Sribar says disruptors are finding new opportunities and are attacking the weaknesses of incumbent businesses.
They are serving unmet customer demands, finding ways to use excess capacity in the supply chain, employ new platforms for awareness and marketing and capitalise on new distribution channels.
Digitalisation also exposes the weakness of the incumbents, as new entrants offer more choices, and better customer experience and price.
Sribar points out incumbents who are not standing still amidst this disruption, are using new digital KPIs for the business, such as the Gartner Digital IQ Index to analyse their brand’s presence in social media, e-commerce, digital marketing and mobile.
Sribar says these organisations measure how many ecosystems they participate in, and the conversion rates in each.
Digital asks for deeper outcome-driven measures and this applies to all industries, including government, he says.
“If you don’t create new efficiencies, new value or new ways to engage with customers and constituents, you are destined to fall behind.”
He proffers three ways organisations can scale in the digital era.
First is to scale up by gaining efficiencies. Second is to scale across by taking capabilities learned from one nit to another, while creating a culture that rapidly learns and adapts. Third is to scale out by combining growth and speed that comes with digitalisation.
He says in this new environment, there will be high demand for skills in three areas - artificial intelligence (AI), digital security and Internet of Things.
31 Oct: The word “FinTech” (financial technology) has been thrown around as of late by hundreds, if not thousands, of startups looking to capitalize on the e-commerce coverage that the growing industry has been receiving. A FinTech, according to definition, is a company that uses new technology in the financial world. Originally, it was a term used to define the back end technology of established financial institutions.
Today, the term is used much more broadly and includes new financial technologies, such as Bitcoin, various e-wallet apps and capital marketplaces like Kickstarter. These companies attempt to disrupt the established financial sector and conventional financial channels by offering services that eliminate the need to use their older counterparts. Other interesting developments in the sector can be found in the insightful infographic the fellows at Play-N-Play have assembled.
Contrary to popular belief, the first truly successful FinTech companies have been around since the turn of the millennium. Some were even around since the late 90’s. The first FinTech to truly become a global financial giant out of this sector is none other than PayPal.
Today, PayPal is worth over 80 billion dollars and is, according to Forbes magazine, the 193rd biggest public company on the planet. Though this success has been nearly 18 years in the making, the rise of PayPal to global domination in the industry it pioneered has not been all smooth sailing.
PayPal was started in 1998 and was voted the worst idea of the year in 1999. The financial and venture capital firms assumed the payment processor would never be able to penetrate the market due to the immense size and market share of its competitors Visa, MasterCard and Amex.
PayPal began to convert users who found the payment system streamlined in the relatively new e-commerce experience and offered a cheaper price point for merchants than Visa, MasterCard and other conventional payment processing systems.
In 2000, PayPal had its initial meeting with eBay, a marketplace for auctioning goods. eBay was attracted to the growing user base and thought PayPal could be an asset to their business model. By 2001, PayPal began its impressive user growth and hit 100,000 users, a number that began to shake up the financial markets and bring attention to the growing FinTech sector.
In 2002, less than 4 years after being founded, PayPal had its IPO (Initial Public Offering) and immediately grew 55%, becoming NASDAQ’s biggest gainer amongst newly listed companies. eBay, immediately spotting the ecommerce growth, purchased a controlling interest in PayPal for 1.5 billion dollars.
The Sunday Times Business Section Cover Story today headline "Banks brace for DISRUPTION". The accompanying article, wrtten by Rob Stock, takes a look at the advent of "open banking", technology. This is technology that could spell the end of the massive profits the banking giants have been raking in,he writes. Embraced in Europe, with a former ASB banker leading the way, here in New Zealand the banks appear to have responded with a deafening silence.
Open banking is the term used for interface systems like Revolut, which offer payments, money management and banking services, without being a bank. Well worth a read . . .
Earlier this month Kiwibank announced it will launch another set of FinTech startups onto the global stage with its second FinTech accelerator. The inaugural FinTech accelerator resulted in several Kiwi FinTech start-ups gaining vital support, funding and expertise to build, launch and expand their products in New Zealand and world markets.
Kiwibank chief executive Paul Brock said the success of the first accelerator had encouraged Kiwibank and accelerator partners Callaghan Innovation and Creative HQ to launch version two of the innovative programme.
“The first accelerator saw exciting new Kiwi companies such as Sharesies, Accounting Pod and Tapi successfully launched to market."
“With the second accelerator, we’re looking to help even more startups capitalise on what is a $1 trillion global FinTech opportunity, and to further grow New Zealand’s FinTech ecosystem.”
The First Accelerator's Success
The inaugural Kiwibank FinTech Accelerator resulted in:
Sharesies achieving $1 million in investments and 5000 users in just eight weeks; full funding gained four weeks before the programme’s investment showcase “Demo Day"
Accounting Pod and Tapi (formerly Flatfish) achieving full funding and on track to crack $1 million annual revenue targets
Mr Brock said V2 of the accelerator would take on an even stronger global focus. “This time we want to have a strong international flavour and we’re targeting exciting overseas ventures interested in basing their FinTech operations here in New Zealand." “There’s strong interest from startups in China, Korea and elsewhere to take part."
"It’s a win-win, given that New Zealand is perfectly placed to take a lead in FinTech globally by attracting the best and brightest overseas talent and capability to help us take our own FinTech ecosystem to the next level.”
About a quarter of the 12 startups to be selected for the accelerator could come from overseas, Mr Brock said. “Quite apart from the ability for Kiwi startups to experience the thinking and technology being applied in FinTech overseas, the global networking potential alone will be invaluable.”
Investment in Chinese FinTech was NZ$9.2bn in 2016 and it is home to the four most valuable FinTech companies in the world (Alibaba’s Ant Financial, Lufax, JD Finance and Qufenqi). There are more than 400 FinTech startups in South Korea with more than NZ$120m invested in FinTechs in 2016. Globally NZ$26.3bn was invested in FinTech companies in 2016.
Sharesies founder Sonya Williams said:“We got a huge amount out of being in the accelerator – mentorship, a space to work, great corporate support. But by far and away the biggest benefit was that the accelerator gave us the start date and support we needed take Sharesies from an idea and turn it into a successful business."
"The company is never going to get off the ground until this leap of faith is taken and we got that from the Kiwibank Fintech Accelerator”
The Kiwibank FinTech Accelerator will open for applications on October 2 and the 14 week pro-gramme will begin in February 2018 and finish with a Demo Day in May 2018.
Creative HQ CEO Stefan Korn said: “Being able to run another FinTech accelerator with Kiwibank and Callaghan Innovation is an excellent step in the right direction to put Kiwi FinTech on the map globally and to establish Wellington as New Zealand’s hub for innovation in the finance sector.”
Machines that can think, learn and adapt are coming -- and that could mean that we humans will end up with significant unemployment. What should we do about it? In a straightforward talk about a controversial idea, futurist Martin Ford makes the case for separating income from traditional work and instituting a universal basic income.
Richard Silverman penned this article on whats behind Ripple and it's future. The CEO of Ripple, Brad Garlinghouse has many reasons to feel good, being in a conference in Toronto with money maverick Ben Bernanke and crypto-genius Vitalik Buterin.
– Yes, Ripple network itself is expanding quickly as it is among few digital currencies that has intrinsic value and has started more and more to be used in real world business, having licenced more than 100 banks and financial institutions to use its blockchain technology. XRP is the only digital asset with a clear use case – it’s the best digital asset for payments.
-Ripple’s Interledger Protocol(ILP) standardize how to instantly settle transactions across different ledgers and networks. ILP can be thought of much like the protocol HTTP used in web address that become a global standard for online information exchange. At last, value can move as quickly around the world through internet just as information does, with a few clicks.
-According to Coinmarketcap, XRP now has a market cap of more than $7,7 Billion, and it is third behind the digital money giants, Bitcoin and Ethereum.
-Ripple is the only digital asset specifically designed for financial institutions. It’s pricing model is one part software license, one part professional services and one part transaction fees.
-The Ripple ecosystem with its huge financial strength used like strategic weapon which enables it to further development of its platform; while engaging the best blockchain experts, hackers, developers, software engineers,and it is constantly evolving, updating; regarding usability, reliability, security and scalability of the XRP Ledger.
-SortedDirectories amendment. This new feature is expected to be enabled in early November, but nevertheless it is advisable to upgrade the nodes as soon as possible, as non-upgraded nodes can’t participate in the consensus process or vote on future amendments. This new update will be deployed to all Ripple servers in real time upgrade which should take around four hours without disturbing the efficiency of current operations. This is another reached important milestone for Ripple.
Behind the Ripple is this great idea and vision of the global market with its Internet of Things and Internet of Value enabled by XRP.
It is estimated that by 2020 there will be 50 billion connected devices, including cars, fridges, thermostats, … this is INTERNET OF THINGS and happening now with accelerating speed. And this is just a first wave in what will be a tsunami of micropayments powering the INTERNET OF VALUE. We’ve shared our vision of an Internet of Value in which money moves like information moves today. Key to realizing that vision is lowering the cost of payments, especially cross-border payments, also very important for emerging, unbanked markets.
Actually there are $18 Trillion of cross-border payments made every year with a combined cost of about $1 trillion a year. Ripple solution through its blockchain technology allows assets to be transferred from one party directly to another without middleman, validated, permanent, completed instantly, irrevocably.
Foreign Payment Transactions is area where banks should completely embrace blockchain derived technology like Ripple, which will allow banks to move away from batch-and-file to smooth real time transactions.
Making cross border payments faster, cheaper, and reliable will bring major benefits to consumers, businesses, banks… It will also connect billions of people around the world to transact, give rise to entirely new businesses and industries, increase financial inclusion for millions underbanked consumers…
The CEO of Ripple, Garlinghouse believes big digital currencies will have a peaceful coexistence.
In his interview to Fortune’s The Ledger among other worth noting arguments, he stated:
“We took a rather contrarian view at the time that we’re not anti-bank, we’re not anti-government, we’re not anti-fiat currency”.
“In 2017, people have realized there isn’t going to be one crypto to rule them all. You’re seeing vertical solutions where XRP is focused on payment problems, Ethereum is focused on smart contracts, and increasingly Bitcoin is a store of value. Those aren’t competitive. In fact, I want Bitcoin and Ethereum to be successful”.
“If Ripple as a company went away, XRP would continue to trade. To me that’s the definition of decentralization”.
Ripple’s goal in distributing XRP tokens is to incentivize actions that build trust, utility and liquidity. The Ripple Net Accelerator program is designed to allocate up to $300 million to create incentives to accelerate adoption. It’s our vision of solving a liquidity problem for banks. We engage in distribution strategies that we expect will result in a strengthening XRP exchange rate against other currencies.
With more and more banks using the Ripple protocol, the supply of Ripple will eventually have to be enough to support the total transaction volume of all the players using the system. Since XRP could feasibly replace SWIFT as a payment system due to its lower cost and higher speed, SWIFT figures can be used as an estimate. SWIFT handles about $5 Trillion each day. This is one of the biggest opportunities for Ripple.
Unlike many other popular cryptocurrencies, XRP is not mined. The company is centralized in many ways. There are whopping 100 billion coins in existence, and they were created by the company Ripple. Ripple has been fast growing and is currently at a market cap of just about $7.7bn. This means that the current circulating supply of about 38.5 billion XRP is trading at around $0.2 each.
It’s very important for Ripple as a company to be very transparent in XRP markets so every quarter they publish a report that specifies how much they sold in the open market and to institutional buyers.
XRP supply, unlike other cryptocurrencies, is partly controlled by the company Ripple who currently owns more than 60% of all existing XRP coins. The fear is that the company will capitalize on its position and flood the market with Ripple coins, from time to time as it suits them, causing a massive oversupply in the short run. For holders of the coin, it could be devastating. This could be not just weakness but also a threat.
– Currently we are permanently removing that uncertainty by committing to place 55 billion XRP into a cryptographically-secured Escrow account by the end of 2017. We’ll use Escrow to establish 55 smart contracts of 1 billion XRP each that will expire on the first day of every month from months 0 to 54. As each contract expires, the XRP will become available for Ripple’s use. We’ll then return whatever is unused at the end of each month to the back of the escrow queue. This technology-escrow enables Ripple to promise a predictable supply of XRP and enablesinvestors to instantly verify such a promise. For comparison, Ripple has sold on average 300M XRP per month for the past 18 months.
Investors should be considering what role Ripple might play over the course of the next several years?
The number of institutions that have partnered with Ripple has exceeded 100 and is growing almost daily and very rapidly.
Yet the price of Ripple has steadily fluctuated around $0.2 for the past months. Why is that?
There are still a lot of potential roadblocks on the way to XRP being traded at lets say higher price than $5.
-First of all, the biggest threat is competition, development of more innovative payment systems that would be similar or even better, technologically more sophisticated, offering an even more attractive alternative using a different coin as a bridge currency, so the amount of money being transferred via Ripple will decrease substantially, or even wipe out XRP usage completely.
-Unfavourable government regulations, or even ban of the cryptocurrencies.
-Many banks and financial institutions have started developing their own cryptocurrencies for the use of interbank transactions.
Still we like the quite feasible idea that the maximum supply of XRP will one day drive a majority of financial transactions which is a powerful incentive to buy XRP coins.
| An Ethereum News release || October 26, 2017 |||
The Financial Markets Authority (FMA) has published a commentary on initial coin offers (ICOs) and cryptocurrency services, alongside online resources for investors.
The FMA said it wanted to facilitate responsible innovation, and ensure that the regulatory regime remain relevant and agile. The FMA said this was supported by the Financial Markets Conduct Act 2013, that sets out one of its principle purposes is to “promote innovation and flexibility in financial markets”.
The FMA said it regularly engages with other regulators and industry bodies (both locally and internationally) on innovation and market flexibility. The FMA said its work in this area was part of an “ongoing effort to better understand, and share our views, on the risks and opportunities associated with technological change and innovation.
FMA said investors must understand the risks involved with cryptocurrencies and associated services before they invest.
“Most online exchanges are unregulated and operate exclusively online, with no connection to New Zealand. This means it is hard to find out who is offering, exchanging, buying or selling. It also makes it unlikely investors will recover their money if things go wrong. Using cryptocurrencies may make investors a target for scammers.
“Consumers need to be aware that cryptocurrencies are volatiles, their value can change quickly and they aren’t widely accepted in the same way as legal tender. The currency held in digital wallets is at risk of being stolen, just like a real wallet.”
Following others in the financial services industry, Mastercard unveiled its own blockchain distributed ledger for cross-border payments.
Mastercard is launching its own blockchain network to enable partner banks and merchants to make cross-border payments faster and more securely.
The Mastercard blockchain service can be used to clear credit card transactions, eliminate administration tasks using smart contract rules and thus, speed transaction settlement.
"By combining Mastercard blockchain technology with our settlement network and associated network rules, we have created a solution that is safe, secure, auditable and easy to scale," Ken Moore, executive vice president for Mastercard Labs said in a statement.
On Saturday, Mastercard will also sponsor the Money20/20 Hackathon, where the company will make the Mastercard Blockchain API available for participating developers.
Blockchain is a public electronic ledger – similar to a relational database – that can be openly shared among disparate users and that creates an unchangeable record of their transactions, each one time-stamped and linked to the previous one.
Mastercard's blockchain is a private, permissions-based network, meaning only those authorized to participate in transactions can see them.
The credit card giant is another among several financial services organizations that have deployed blockchain-based cross-border payment networks.
Earlier this week, IBM announced it had partnered with a Polynesian payments system provider and an open-source FinTech payment network to implement a new international exchange based on a blockchain electronic ledger.
A new blockchain solution from IBM and Maersk will help manage and track the paper trail of tens of millions of shipping containers across the world by digitizing the supply chain process.
Jeffrey Neuburger, partner with Proskauer Rose LLP, an international law firm specializing in corporate finance, characterized IBM's blockchain deployment as "a major milestone for implementation of blockchain in major financial institutions."
IBM partnered with KlickEx Group, a United Nations-funded, Pacific-region financial services company, and Stellar.org, a nonprofit organization that supports an open-source blockchain network for financial services, to create the new cross-border payments service.
That partnership is likely to be a "watermark event in the growth of blockchain and digital currencies," Neuburger said.
"A lot is riding on the success or failure if this. Particularly interesting because the participants created their own digital currency for this implementation, and it will be interesting to see how regulators, among others, will receive this," Neuberger said.
Mastercard's blockchain is integrated into the company's payment network that includes 22,000 financial institutions to move funds that have been committed on the blockchain.
Mastercard's financial services and merchant customers will be able to connect into its blockchain network using an API, alleviating them from having to build out their own distributed ledger server nodes. Once a part of the blockchain network, banks and retailers can add their own internal nodes to scale capacity, Mastercard said.
"When it comes to payments, we want to provide choice and flexibility to our partners where they are able to seamlessly use both our existing and new payment rails based on the needs and requirements of their customers," Moore said.