The Future of Money Stage
Treasury is generally concerned with the here and now, the practical realities of cash, funding and risk. But money is changing so fast that treasurers today need a firm understanding of cryptocurrencies, tokenisation, central bank digital currencies and how these innovations will affect both the fundamental infrastructure of finance but also their day-to-day operations. And the Board will want to know too.
What’s real, what’s hype?
We live in a world where a joke cryptocoin goes mainstream on the back of a tweet by a man who fires cars into space to the tune of ‘Major Tom’. Blockchain tokens of digital artworks sell for tens of millions of dollars. And it still isn’t clear whether the two largest cryptocurrencies are just pyramid schemes fuelled by zero percent interest rates. Even the regulators aren’t sure. However, the digital tokenisation of currencies and the ways in which those tokens function and are distributed are now part of mainstream thinking in central and commercial banks, financial market infrastructures and regulators. So which developments will result in real change, and which are likely to fade away? What does a world of CBDCs and tokens look like? And what are the possible pros and cons for companies and their treasurers?
A digital money deep dive
While they have been confined to the fringes of finance, cryptocurrencies, NFTs and DeFi (decentralised finance) did not require treasurers or CFOs to understand precisely how they work, where they can be used and what the risks might be. That is no longer the case. As major banks, card companies and fintechs embrace these new concepts it is imperative that finance professionals get to grips with the details. How does the blockchain actually work? What are the implications of permissioned and non-permissioned versions? Does tokenisation of an asset confer ownership and what are the tax implications versus, say, derivatives? Are stablecoins really stable? In this session, our experts will take apart the core products and technologies and explain how they work in the real world. The audience will be able to ask detailed questions relevant to what treasury needs to understand for the future.
What mainstream crypto looks like
We are all familiar with the list of companies that accept Bitcoin, but there is a lot more to embracing digitalisation and tokenisation than that. The real drivers of crypto adoption will come from more significant parts of the payments and banking infrastructure and this global card and payment firm is as far ahead as anyone. Crypto payment cards, crypto partner wallets for stablecoin payouts enabling USDC payouts, a growing network of crypto partners and a suite of crypto APIs – these are just some of the initiatives running today. The company is developing native digital currency settlement on card networks and has also launched a crypto consulting service. It believes that as digital currencies become more interoperable, and new connections are forged between digital and traditional currencies, companies will have to incorporate crypto into their businesses and financial functions.
Reality check: the crypto treasury panel
You’ve heard from the digital evangelists and pioneers, but what about your peers in traditional firms? To what extent have they been following developments in DeFi and will that change as the pandemic recedes? Will digitalisation, hybrid working and the next wave of economic disruption make adoption of digital currencies and tokens more or less attractive? And how much attention have ‘normal’ companies – companies outside the technology financial sectors – paid to crypto developments so far? In this panel hear the perspectives of treasurers like you and take the opportunity to quiz them and some of the solution providers about possible first or next steps.
A deep dive: why tokenisation should be on your agenda
Stock and bonds can be tokenised and new entrants are looking at how to tokenise various components of trade and supply chain finance. All that is left is to turn real assets into tradable tokens too. And that is indeed the next step. One of the key benefits of tokenisation in the supply chain was the ability to create a tradable asset out of a single identified consignment. The same idea can be applied to a building, a vehicle or even a piece of machinery in a manufacturing plant. Taken to its logical conclusion, this is the foundation of what is being called the asset-as-a-service business model in which assets, no matter what they are, can become a profit centre, users pay per use, and investors have a new asset class. But is what sounds like a blurred version of securitisation, derivatives and hire purchase (it’s been around a lot longer than BNPL) new and exciting? Does it create any new value? And why is it relevant to corporate treasury?