Cyber Risk Insurance translates Nerd-Speak to Boardroom-Speak


Cyber Risks Extra Extra

Reposted, as it is Chinese New Year for Zarc Gin, our regular Insurtech Expert based in China.

Why do Banks exist? That is not some deep, philosophical question about the role of money in society. Banks exist to protect your assets from thieves. Because they do a good job of this, they can make a lot of money lending some multiple of what they store in the vaults. The only difference now is that the modern version of Butch Cassidy and the Sundance Kid are getting monitor tans as they cyber-attack the vaults from their computers.

Money is one asset to protect. Data is another. So is data about assets. In the digital age, it is all about data. And data is easy to steal.

All the good things that we write about on Daily Fintech – all that agility/productivity enabled by data and connectivity – also benefit Butch Cassidy and the Sundance Kid.

Cyber Risk is one nerdy subject that gets Board level attention because the risk is so high. Global 2000 companies can lose $ billions from a single hack. The problem is that cyber security is also an intensely complex subject technically.

One reason that so many influential leaders subscribe to Daily Fintech is that we are good at translating Fin to Tech and Tech to Fin. So we are attracted to the challenge of translating Cyber Security Nerd-Speak to Boardroom-Speak. It is one of the toughest translation jobs around. Even with a lot of technical experience, Cyber Security can be daunting. Even with a lot of business experience, understanding how a Global 2000 Board thinks can be daunting. Both are tough on their own. Translating between the two is even tougher, because they could not be further apart.

That translation, though hard, is ultra-critical. The Board has to really understand Cyber Security and they are currently failing at this task. This article on LeadingBoards describes the problem very well

Cyber Security technology = big budgets & bigger risk

The global cybersecurity market reached $75 billion in 2015 and is expected to hit $170 billion in 2020 (source, Forbes).

This is one market where the “you never get fired for buying (insert Big Tech vendor)” mantra breaks down. In most other enterprise technology markets, the big vendors tend to win because the Boardroom does not really care who is picked. So the senior IT managers making the decision go for the vendor that is competent enough to do the job and big enough that if it all goes wrong they can say “but all our well-respected peers made the same decision”.

That defence breaks down in Cyber Security because the risk is so high. Nor can a Board simply say “the CISO who made the decision has already been fired”. The Board has to take direct responsibility. Which means the Board has to understand Cyber Security.

How is the Board supposed to understand something as nerdy as Cyber Security?

We take a lot of briefings on cyber security technology, because we know how important it is. Listening to all these super-smart tech guys explaining the latest cyber security teaches us that a) it is hugely complex and b) there is no silver bullet.

We use a simple mental map that translates Cyber Security to the analog world:

  • Perimeter Security is where most money is spent. Think fences, guards, dogs. The fundamental problem is that somebody will always get through. The bad guys also benefit from Moore’s Law and can use SMAC (Social Mobile Analytics Cloud) to collaborate and share (what has been dubbed Crime As A Service). You can be the biggest bank or the biggest government and you still get hacked.
  • Digital ID. Think body part scanners (finger, eye, voice etc) that determine who can get into the building. We have written a lot about Digital ID technology and it is improving at a remarkable pace. The problem is collusion with a trusted inside-person who is part of the crime gang; the person with perfect Digital ID is a criminal.
  • Protect from the inside. This assumes that both Perimeter Security and Digital ID is imperfect. One way to protect from the inside is process controls (for example needing more than one person to send a wire). This also suffers from the collusion problem, but it is better as it is harder for criminals to corrupt the two individuals in a process. Another way is to write code that is secure. The problem is that both better process and better code hit the agility/efficiency problem. Banks have to move fast and efficiently to beat competition AND be secure. One alone is not enough. For example, Banks want to use high level languages and tools that enable rapid time to market even if that means the developers are not thinking much about security.
  • Protect when data leaves the vault. This assumes that all three methods above will fail. The analogy here is marked banknotes used in a kidnap ransom. Again, the bad guys have very sophisticated technology to get rid of these markings, so this is yet another arms race.

If you cannot measure it, you cannot manage it

That is one of the oldest truisms of business. If you listen to the pitches of any Cyber Security vendor, you will hear that they have the solution. The problem – as any reasonable attentive business person can observe – is that even companies with all this smart technology still get hacked. The empirical evidence is that there is no silver bullet.

Insurance has historically worked on statistical models. This works fine – until it no longer works. When something fundamental changes, the models become deeply flawed. We have tracked this as it relates to catastrophes created by climate. The use of data and connectivity by cyber-criminals is analogous. The risk went up in unpredictable ways. It is no longer good enough to rely on historical models. Cyber Risk is like Climate Risk – the historical models do not predict the future accurately enough.

What companies want is something as simple as a cyber security safety rating. Insurance Companies have the right motivation to give an honest rating (unlike credit rating agencies that are paid by the seller). Insurance Companies won’t award a AAA cyber security safety rating to a BBB company, because they will pay in claims for getting it wrong.

That means Insurance Companies need to turn into cyber security experts. A tech vendor may say “we have the secret sauce” to change your rating from BBB to AAA and thus lower your premiums. The Board will say “sure, if you can convince our Insurance Company that this will lower our premiums, we have a deal.”

Startups in this risk metrics space include CyenceBitSight and Security Scorecard.

Cyber Risk Insurance is a data game and that is a problem

Cyber Risk is one of the fastest growing parts  of the Insurance market, accounting for over $3 billion in premiums.

Banks are in better shape than others. Protecting against thieves has been a core competency for longer.

Cyber Risk Insurance people differentiate between Micro and Macro. The latter is the news-worthy hacking between governments (cue image of the nerdy young Q in recent James Bond movies). Our concern is the more boring Micro Cyber Risk Insurance – exciting enough as this is about whether huge companies can lose $ billions from a single hack. The Micro could become the Macro if a number of Micro hacks led to a crisis of confidence in the financial system akin to September 2008.

Talking to experts in this relatively new field it is hard to get a lot of on the record quotes. That indicates a market that is nascent enough that the solutions are not obvious. To entrepreneurs that signals opportunity.

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Bernard Lunn is a Fintech deal-maker, investor, entrepreneur and advisor. He is the author of The Blockchain Economy and CEO of Daily Fintech.

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Square launches SMB Card and POS platforms hit payday

This week Mastercard launched a report in collaboration with CB Insights where it made the not so terribly startling prediction that SMBs would ‘become the next battleground for fintech’ in 2019. I think SMBs have been the battleground ever since the word fintech was coined, however the market has proven incredibly hard to crack.

One key area that the report did zone in on, which I think is interesting, is the renaissance of the point-of-sale system, or POS. Its centrality in the SMB ecosystem, both in driving business for an SMB and in providing a platform for fintech plugins is still widely under recognised, and under-utilised.

The report notes a few companies who are starting to embrace this privileged position, by branching out of pure hardware and basic software capabilities and into payment, sales enablement, inventory management and CRM hubs. These POS systems are generally also compatible with cloud accounting packages, the hub on which many fintech lenders sit. All these parts of the ecosystem are heavily dependent on each another, creating a symbiotic and hopefully stronger financial infrastructure, ultimately powered by a layer of dynamic data.

The report calls out some of these POS systems – Toast, Upserve and Toronto based global player Touch Bistro, a company I remember working directly with on an Australian integration, during my time at Tyro.

Square of course is rapidly deploying into this ecosystem, having seen the forest for the trees years well before many others. That, or Jack and co were simply brave enough to act on their foresight.

Proof its continuing to lead the charge in the SMB battle came in late January, when Square launched Square Card, it’s SMB Mastercard debit card. The card allows business owners to draw on their Square takings, and also offers an instant discount on purchases made at other Square sellers. Deceptively simple, and an idea Amex could and should have monopolised on long ago via their Shop Small initiative. It’s one of those ideas a ruthless focus on the core customer – SMBs – allows platforms like Square to launch.

Keep an eye on the POS platforms, as this is where a good degree of the action will take place going forward.

Daily Fintech Advisers provides strategic consulting to organizations with business and investment interests in Fintech. Jessica Ellerm is a thought leader specializing in Small Business and the Gig Economy and is the CEO and Co-Founder of Zuper, a new superannuation startup in Australia.

What is the problem with Money being a claim on an Institution? Reflections from the AxessThinkTank event

axessThe first full day event focused on what is now `Alternative finance` was of high quality and non-tribal. Organized by the Geneva based, Axess Think Tank, with four themes

  • The future of money
  • The Regulatory landscape
  • ICO-STO and Capital markets
  • Blockchain and the Token economy

I had the great pleasure of moderating the last two topics.

Watch Alpha Point the US based leader in digital Exchange software white label solutions and DLT software. Both team members were extremely upbeat about the growth prospects of their market sector. The CME group and the Royal Mint of England are already their customers and Novogratz invested in them last summer.  I felt that they are out there for a mass distribution of Crypto Exchanges that will allow for the tokenization of all kind of illiquid Assets. While selling exchange software, they are disintermediating the oligopolistic conventional exchange software business.

Cryptofinance is a Swiss quality business that offers asset management services, brokerage and custody. Lewin Boehnke CTO of Crypto Storage AG and head of research and shared insights from their journey, seemed to have a card up his sleeve when he repeatedly stated that

`there are a few major players that will join the digital asset class soon`[1].  Stay tuned on their news.

SCX is the new fully regulated Swiss Crypto exchange live since last summer. The Chairman of the board Christian Katz joined our panel. He is the former head of the SIX exchange and is now devoted to building an institutional grade business. A secure and transparent crypto exchange is undoubtedly needed and C. Katz knows the inside outs of the exchange business.

Taurus is a new Swiss player offering brokerage and trading services. Recently also added storage solutions.

LakeDiamond & Monart, were the two specific tokenization use cases that participated. One in tokenizing the industrial production of diamonds and the other in the contemporary art space.

Capco shared lots of insights from their clients and the projects that they have working on.Romal Almazo, Capco’s UK DLT & Crypto Lead continuously emphasized that we need to go back to the core issue

`What is the problem we are trying to solve?`. Five words please. Then we see whether blockchain can do the magic and solve it.

He was also assertive, in his belief that only what is FCA approved will be the dominant tech that will scale. He announced a CAPCO pilot project that is by invitation only, in which CAPCO will use its global network of SMEs to participate in a solution around digital assets that will be led by CAPCO. The aim is to develop a blueprint in solving market problems via digital assets.

CVVC and Amazix, participated in the panels, sharing their experiences from the growth and pivoting of the startup ecosystem.

e-Money, CBDC, and BTC

When you have a board member of the SNB Andrea Maechler, a senior research advisor to the BOE Michael Kumhof, a research fellow of the Fed St. Louis & Professor at univ. of Basel Aleksander Berentsen, a research fellow of the UCL Center for Blockchain Technology Daniel Heller; there is a lot to absorb from their talks and panel discussions. Add to that the moderator Michel Girardin, from the Univ of Geneva and Jean-Pierre Roth, the ex Governor of SNB, in the audience.

They agreed that payments are the very heart of any economy and that we live in a world that customers expect payments to be like WhatsApp messages.

The SNB is actually following the innovations around payments, whether Fintech or Bitcoin originated. Andrea Maechler, emphasized that the SNB`s mandate is to support and promote cashless payments and this done through SIX. Fintechs that hold a FINMA payment license will be granted access to the SIX system.

Regarding CBDC[2]`s they have concluded that it is not a tech issue but rather a policy issue. The SNB believes that while there are advantages, the main disadvantages, make CBDCs a no-no fort he SNB. They see that a CBDC would increase the risk of a bank run and would make monetary policy ineffective when it is actually mostly needed.

This is where Aleksander Bernesten actually stepped up and provoked the thinking. He firmly believes that Central Bank electronic money would increase financial stability.

Give access directly to the CB to all.

His motto is that

the Censorship resistant attribute of Bitcoin, is priceless!

He makes things simple by focusing on this attribute. Since there is no free lunch, we have to choose between

A Censorship resistant database which is inefficient and slow


An efficient and fast centralized database which is not censorship resistant


He thinks that a central bank decentralized currency has no meaning at all. Forget about a Fedcoin type of idea. However, he proposes that Central banks issue electronic money for all! So instead of having the authorized commercial banks exclusively access directly the CB, we should all have direct access to the CB. Forget about the RTGS system.


For those that want to understand more details read The Case for Central Bank Electronic Money and the Non-case for Central Bank Cryptocurrencies

Note: This post is not comprehensive coverage of the event. By joining the Axess think tank you can access the video recordings and more. Check it out here.

Don’t forget that currently

MONEY is a claim on the Central Bank or a commercial bank!

Will this change? How and when? The Why has been answered: For a Censorship resistance monetary system.

[1] Check

[2] Central Bank Digital Currency

Efi Pylarinou is the founder of Efi Pylarinou Advisory and a Fintech/Blockchain influencer.

Get fresh daily insights from an amazing team of Fintech thought leaders around the world. Ride the Fintech wave by reading us daily in your email.

Blockchain Front Page: Lightning Network Gaining Traction

lightning-netLast week our theme was “New York regulators approved new Crypto ventures”

Our theme for this week is “Lightning Network Gaining Traction.

Since it went live early last year, the Lightning Network has skyrocketed. With over 630 Bitcoin (BTC), more than 23,000 channels and a total network capacity of $2 million on the Bitcoin mainnet, according to data from 1ML, LN’s capacity for BTC has had crazy growth, going from 4 to over 600 BTC since last February.

Screen Shot 2019-02-04 at 3.49.26 AM.png

In the last three months, LN’s growth has been even more steep. The release of Casa Lightning Node has been a huge factor driving this growth, making it very easy for non-technical users to run an LN node.

But, Casa is not the only reason. Campaigns carried out by the community, like Lightning Torch and the growing number of wallets that support LN, are some of the other reasons for this growth.

The first Lightning implementation by Lightning Labs was launched in beta in March 2018. The other two, by ACINQ and Blockstream, were launched in late March and late June.

Last week, Casa announced the launch of a new browser extension. The software will allow Bitcoin Lightning Network-enabled nodes, to be accessed directly from crypto websites. Casa Extension will make interactions seamless, allowing users to click on a button and make a payment on a website that accepts BTC.

The original Lightning Network white paper was released in February 2015, by blockchain researchers Joseph Poon and Tadge Dryja. Since LN’s introduction, we’ve seen different projects developing on the Lightning Network and others working protocols that use some of the same technology.

One of these projects is Arwen, that wants to be for trading, what LN is for payments. With $865 million lost to hacks on centralized cryptocurrency exchanges in 2018, and more than $1.5 billion in total up to now, Arwen is trying to solve a big problem. Arwen has developed a new protocol that allows traders to have control over their private keys, even when their coins are stored on an exchange. Users maintain self-custody of their coins in their own hardware or software wallet, without having to transfer their keys to a third-party. Last week, KuCoin announced a partnership with Arwen, to offer a non-custodial service to its customer base.

While the technology is still in testing, LN aims to make Bitcoin transactions faster and cheaper. The most remarkable growth metric for LN is the growing number of nodes, with active channels. On average, each node has nearly 8 channels and each channel has an average capacity of $110.

The Lightning Network has become one of the most promising approaches to making Bitcoin a fast, cheap and secure payment network. The technology is still in its infancy and for most people, LN is not relevant. But given the growth we’ve seen, it may very soon be. At this rate the LN’s capacity could exceed a billion, over the next year.

Whether LN is successful or not, in many ways depends on how successful Bitcoin is, in maintaining its lead over other cryptocurrencies. Currently the entire crypto market is valued at $113 billion, with BTC representing 53% and Ripple, the second in line, at 10%. But prices and market cap will not be the only factors, it will also depend on how quickly competition can scale and how seamless the experience becomes for users.

For more about the Front Page Weekly CXO Briefing, please click here.

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Ilias Louis Hatzis is the Founder & CEO at Mercato Blockchain Corporation AG. He writes the Blockchain Weekly Front Page each Monday.

Fintech India boosted as Blockchain Consortium for SME lending kicks off

Fintech India saw a boost in 2018 with over 132 investments in startups, with a large proportion of them going into Lending and Insurance. The total investment was about $2 Billion as of Nov 2018. Sequioa, Omidyar, and Kalahari capital were the top investors in the sector.

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The New Year opened with a bang as 11 Indian banks have now come together to form a Blockchain consortium to address the under served SME lending market.

The rise of India Fintech in comparison with the likes of China, is still dwarfed. However, the policy makers have provided ample support to the innovation ecosystem to thrive. Initiatives such as NPCI (National Payments Council of India), Digital India Programme have helped.

The Reserve Bank of India (RBI) has approved 11 fintech firms
who could now be payment banks that offer deposit, savings, and remittance services. Unified Payments Interface (UPI) has been the bedrock of the digital payments boom in the country.

You are probably thinking – too many TLAs (Three Letter Acronyms), but the impact of all these measures on digital payments and lending in the country has been significant.

Inspite of all this, the SME lending market in India has been particularly challenging. SMEs in the country relied on a complicated supply chain that was broken and lacked transparency. A Blockchain network would provide lenders with public credit data, that they could use for their underwriting decisions.

The Micro SME lending market is about 17.3% of the overall corporate lending market in India. And after the recent IL FS scam, the corporate lending market needed a boost to tap into the under served SME sector. The 11 banks involved in the Blockchain consortium would first reach out to supply chain vendors and get their records digitsed.

The consortium includes names like ICICI, AXIS and State Bank of India, who together make up a big proportion of the lending market. Getting them all on a single network along with digitised supply chain information, should allow them to make near real time lending decisions to Micro SMEs.

Arunkumar Krishnakumar is a Venture Capital investor at Green Shores Capital focusing on Inclusion and a podcast host.

Get fresh daily insights from an amazing team of Fintech thought leaders around the world. Ride the Fintech wave by reading us daily in your email

Insurtech Front Page Weekly CXO Briefing – Emerging markets


The Theme last week was about Online Insurance Marketplace.

The Theme this week, is about emerging markets. Emerging markets are about hopes, potentials and future growth. When a market grows huge enough, it could evolve into something better.

For more about the Front Page Weekly CXO Briefing, please click here.

Incumbents embracing InsurTech is a common theme in our posts. This time, it’s about customer engagement.


Story 1: Global reinsurance giant drops “emerging market” label for China

Extract, read more on Asia Insurance Review:

“Global reinsurer Swiss Re no longer places China as an emerging market, but instead views the country as a important strategic market, according to Mr John Chen, head of Reinsurance China and China country president for Swiss Re.”

What is an emerging market? According to Wiki, an emerging market is a country that has some characteristics of a developed market, but does not satisfy standards to be termed a developed market. And according to Insurance Information Institute, China’s insurance market by annual premiums has been top 2. It’s safe to say China was huge enough to graduate from the identity of emerging market.


Story 2: Allianz launches reinsurance business in India

Extract, read more on Verdict:

“Allianz Global Corporate & Specialty (AGCS), part of German insurance group Allianz, has set up reinsurance operations in India after securing regulatory nod.

The new reinsurance branch will be located in Mumbai. It will provide facultative, proportional, and non-proportional reinsurance solutions for property, liability, marine, financial lines, construction and engineering, as well as energy.”

India, despite of the biggest population, is more like an emerging market than China. According to IRDA, India’s premium income in 2017 is 98 million USD which can’t make top 10 worldwide. But the population is in place, therefore the potential.


Story 3: Allianz to Enter Vietnam Insurance Market via Joint Venture with IT Firm FPT Group

Extract, read more on Insurance Journal:

“Allianz announces its intention to enter the general insurance sector in Vietnam through a digital joint venture (JV) to be set up with the FPT Group – driving long-term success in the market and expanding Allianz’s footprint in Asia.

FPT Group, as the strategic technology partner, will support Allianz in the fast-growing Vietnamese insurance market to develop innovative digital insurance products and services to meet the protection needs of local customers.”

Vietnam is one of the most promising emerging market in the world as it is likely to become a next world factory after China. Insurance, as a financial infrastructure, is an attractive treat for top insurers like Allianz.


Since the developed markets have a sophisticated operating system for insurance. Gaining old policyholders’ attention can be intense. The emerging market is a great new battlefield for international insurance superpowers. I think we will see more and more top insurers tapping into emerging countries in the years ahead.


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Zarc Gin is an analyst for Warp Speed Fintech, a Fintech, especially InsurTech-focused Venture Capital based in China.

Check out our advisory services(how we pay for this free original research).

To schedule an hour of Zarc’s time for CHF380 please click here to send an email.

Education is the cost of doing business in invoice finance

Strategic partnerships are booming in this sector globally, as the magical tech-meets-distribution sweet spot sees more banks and fintech vendors cuddling up.

One needn’t look further for proof than news out last week that British based invoice financing platform MarketInvoice had closed a £26 million equity funding round with Barclays and Santander.

Barclays have been involved with MarketInvoice for some time, after acquiring a minority stake in the business in August of 2018. Banks, like Barclays, are slowly realising deploying growth capital to SMEs isn’t something they are equipped to do – from a risk management or digital delivery perspective.

Invoice finance isn’t child’s play. There are plenty of traps for new players, and technology isn’t always a failsafe against rogue business owners and fraudulent activity. Automating the credit-decision process is still a challenge, and imperfect information sets, even in cloud accounting software, still present challenges and risks to lenders.

But the upside, if you can get it right, is huge.

To get a sense of the nuances within this industry in the UK, the UK Finance body reports are a good starting point. The Q2 2018 report sheds some light into the ebbs and flows of the various financing flavours that make up the sector: Here are some highlights.

  • Export and Import factoring grew by 13.1% over the quarter, while Export Invoice Discounting fell by 9.9%.
  • UK invoice finance growth overall trails asset based lending, however its slice of the total lending pie is significantly greater.
  • Construction, followed by retail and transport were the fastest growing industry sectors
  • The two sectors with the biggest concentration of clients, when measured by turnover are £ 0.0-0.5M, at 12,193 and £ 1.0-5.0M, at 13,289

Numbers have been fairly static on many growth fronts for the UK sector over the past year or so – possibly a Brexit or trade uncertainty signal flowing through into growth investment decisions made by SMEs. While there is room for growth given the various statistics on growth capital demands more generally, finding the lever is key. It is probably less a ‘do we have capital available to deploy’ challenge for invoice finance businesses and more a lack of understanding about the product set amongst potential borrowers, something many vendors can tell you about in this space.

Perhaps MarketInvoice will use its new working capital to raise the profile of the sector to the benefit of the many startups in the ecosystem. Someone will need to bite the bullet and make this investment for the sector to grow.

Daily Fintech Advisers provides strategic consulting to organizations with business and investment interests in Fintech. Jessica Ellerm is a thought leader specializing in Small Business and the Gig Economy and is the CEO and Co-Founder of Zuper, a new superannuation startup in Australia.

The Self-fulfilling Prophecy; reporting from the WEF in Davos2019

It makes sense to gather high up in the Alps, above the clouds where the sun shines on anyone strolling around while temperatures are -10C or more, to discuss about `Globalization 4.0 `. For those who disagree, just think of it as a tradition.

This year there was no Eureka moment (except if I missed it) but there was a loud and clear support for the Gorilla in the room narrative

A self-fluffing prophecy:

Transhumanism – technology solves our large scale problems!

 So let’s all get to work on experimenting, applying, pivoting technologies, to make the dream come true. It was clear from the themes of talks and panels that we are already spending time and resources on discussing how `Tech` will become reality and what will be the consequences and side effects. Artificial intelligence, Internet of Things, Robots, the future of Work, Blockchain, are the trending tags.


Given my physical limitations, I attended some events from which I am sharing `color` as we used to say on the trading floor (that is any information that paints a picture of over the counter OTC markets).


The Global Business Blockchain Council – GBBC, led by Sandro Ro who was appointed in March 2018 covered diverse topics. I arrived to go directly to the Procivis[1], Vetri[2] event because the issue of self-sovereign identity is a building block towards a more decentralized globalization 4.0. The support from the regulator of the canton of Zurich and the presence of the prime minister of Bermuda were one of the highlights.

Watch this space. Later during the week, Joseph Lubin and Tom Lyons had a fireside chat at the infamous piano bar of Hotel Europe, organized by CryptomountainRocks special event during the WEF, and J. Lubin spoke extensively about uport.

Self-Sovereign Identity is the concept that people, businesses, and entities, can store their own identity data on their own devices, and provide it efficiently to those who need to validate it, without relying on a central repository of identity data and without leaving hackable copies all over the web.

This is really the core of the next generation Web. In a nutshell, it means that Blockchain IDs are the way for individuals and any legal entity. These are universally discoverable through zero-trust datastores.

Self-sovereign identity is the chip for Democracy and Web 4.0

 Having said this, I must point out that the anti-blockchain tribe (N. Roubini and more) continue to highlight that we have actually not seen any real use case of the hundreds of Dapps being developed. I also heard that in the crowd that attentively gathered to hear J. Lubin speak. Consensys has not managed yet to make one of its Dapps a solid business case. The Ethereum protocol on the other hand, in an exemplary decentralized fashion, got used for the next generation of crowdfunding. From a 35,000 feet point of view, this does qualify for the next iteration of a decentralized autonomous initiative, launching a business process that created value but also `polluted` capital markets. I can imagine, reviewing this decentralized autonomous collaboration, to see what worked and what didn’t.

I also attended the Women in Blockchain Switzerland panel, which won my heart as the most diverse panel. I walked away hugely inspired by Viola Llewellyn, the African co-Founder & President of the smallbiz Fintech Ovamba and Diana Grigoras. I am only highlighting these two amazing women, only because I know closely the work that Monique Morrow[3] is involved in, Bill Tai (VC, athlete, educator), and Robin Errico Chief Risk Officer and Diversity & Inclusion Leader at Ernst & Young Ltd, Switzerland (EY), who also participated in the panel.

Viola is another woman that is successfully making an impact in the lives of the small businesses in Africa that don’t have a credit history and won’t be served by banks. She has combined Fintech with her local cultural knowledge to offer short-term capital to micro, small and medium-sized businesses. The capital is provided by international investors from the US, U.K. and Japan. Ovamba covers Africa, emerging markets and the Middle east for trade, inventory purchases and growth. Already a 5yrs old Fintech, mobile only and first launched in Cameroon, it now links capital from overseas to businesses in the aforementioned markets. GLI Finance, the UK based alternative lending provider, and Crowdcredit, a Japanese cross border marketplace lending platform are amongst the international partners.


Communities are still being built with the vision and persistence of a strong leader.

Women excel in building communities, which is excatly what we need for Globalization 4.0.

I visited the Ethereal Lounge and bumped into Don Tapscott who was excited to share more details about the large scale upcoming event in Toronto, Blockchain Revolution Global. A collaboration of the Blockchain Research Institute (BRI) and the MCI world; with a focus on enterprise level applications with a cross-industry selection. I also met for the first time Joe Lubin and chatted about a dear topic to me `liquidity` for digital assets (so many still confuse digitization with liquidity). He mentioned, a new Consensys baby, in beta mode which the next generation for designing an open platform for vc investing.

Consensys did layoff people but the venture production continues. Kaleido, a ConsenSys business was launched in collaboration with Amazon Web Services (AWS) this past summer. I heard about it from J. Lubin. It is a marketplace for enterprises to plug-and-play.

Blockchain powered IT services are being built at an accelerated speed. I can’t keep up with innovations.

I spoke at Cryptomountain Rocks, after Daniel Diemers and Barbara Lang, on `A Wall Street take on Crypto`. I shared my strong point of view on how Wall Street will take advantage of the change in the narrative in the blockchain space from a pure `Disruption` rock band style to a `Co-creating sustainable innovation` one.

What parts of the pie from the new digital assets, will Wall Street aim at and what will be left untouched for the cyberpunks[4].

Exclusion is where value is hidden and can be unlocked

 CryptomountainsRock Battles

One of the most effective ways to open up the conversation on topics like decentralization, transparency, rethinking money, unlocking value, digitization of assets and processes, etc, (beyond writing our insights tirelessly here at Daily Finte ch along with others sharing knowledge and expertise on other platforms – text or audio) is the live Cryptomountains Talk Battles that Reto Gradient has designed and is the trademark of the unconference every Spring in Davos. This year was the inaugural event during the WEF of Cryptomountains with lots of talks and panels.

Talk Battle topics during the WEF

  • Forget about Bitcoins
  • Decentralization is an Illusion

The two participants, have 3min each to share their arguments. One has to be pro and the other against. After this the audience votes which speaker needs more support (i.e. arguments are relatively weak). Then, people from the audience line up to support their choice of weakness and have 1min to `help` on stage with their argument. The battles end by….

If you want to participate on stage or from the audience in this kind of battle, come this March to the original annual event in Davos – the unconference with skiing in the morning and talks +.

[1] Procivis and Valid, the early pioneers in Self-Sovereign Digital ID for governments, by Efi Pylarinou

[2] Monique Morrow has been recently appointed President of Vetri. She is the founder of the Humanized Internet and a unique personality that guarantes execution in full alignment with the mission.

[3] Listen to the podcast with Monique Morrow, co hosted with Arun Krishnakumar, on Humanized tech with built-in values.

[4] To book me for a talk – conference event, private event, conference – on this topic or more, click here.

Efi Pylarinou is the founder of Efi Pylarinou Advisory and a Fintech/Blockchain influencer.

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Blockchain Front Page: New York regulators approved new Crypto ventures


Last week our theme was “Anonymous transactions in Bitcoin”

Our theme for this week is “New York regulators approved new Crypto ventures

Its official, New Yorkers can now use Robinhood to buy Bitcoin. The Department of Financial Services in New York has officially approved a BitLicense for the popular trading app. Residents in the State of New York will be able to buy Bitcoin using Robinhood’s app, with their debit cards.

In a blog post, Robinhood announced they were also granted a money transmission license by the state. Since January last year, Robinhood has expanded the number of cryptocurrencies listed and currently has seven of them available in 30 states across the US.

LibertyX was the second company to be recently granted a BitLicense, becoming the very first regulated company to let New Yorkers buy Bitcoin, using traditional ATMs. Their BitLicense will allow New Yorkers to purchase BTC, at potentially thousands of brick and mortar locations through the state. LibertyX introduced the first Bitcoin machine in 2014. The company makes it easy for anyone to buy virtual currencies in more than 19,000 physical location in the U.S.

When it come to cryptocurrencies, the State of New York has some of the toughest regulations. A BitLicense is required to offer cryptocurrency services in New York. The license was created in 2015 and is considered one of the most important and hardest licenses to get in the US, because of strict regulations relating to anti-money-laundering, anti-fraud and cybersecurity policies. Up to now, the New York regulator has approved 16 companies to offer cryptocurrency services in New York.

Many investors see regulation as the primary reason for crypto’s bear market and the ICO slowdown in 2018. Most crypto enthusiasts are not optimistic about regulations for crypto. For many, the idea of assets like Bitcoin is to get around the regulations of the traditional financial system. An article on Medium, goes as far as saying “The BitLicense Is a Bad Idea That Must Die“.

“All the “BitLicenses” in the world could not stop MTGOX from having a software problem, and no law can bring back the money lost either directly or through the disruption the event caused by the software error. Once again, entrepreneurs powered by the internet make life easier and better, not laws and regulations. Regulation does not make software correct; developers do.”

Recently, the Winklevoss twins publicly ran an advertising campaign encouraging rules for crypto. The ad goes: “Crypto Needs Rules.”


I think that regulation is very important for validating crypto. When big organizations like Yale, Goldman and Fidelity make investments in cryptocurrencies, this brings a lot of credibility to the market. But, regulation can validate the market beyond anything else. It brings clarity and protection to both businesses and consumers.

The fact that government regulators are taking note, is very important. Yet, none of this is to say that government regulations are always good. Regulations need to be taken with a grain of salt, because over-regulation can hurt businesses in an early stage of growth and stifle innovation. As we go through this transitional period, its very likely that those who can’t afford to play by the rules, will disappear.

I expect 2019, will be the year of regulation. At the last G20 meeting, the top 20 economies said it clearly: “We will regulate cryptocurrencies.”

We will see more and more government agencies across the globe, defining regulatory frameworks for crypto, to provide adequate consumer protection. More regulatory clarity can speed up the process of major financial institutions getting in the market and open up the possibility of public investment vehicles, like an exchange-traded fund (ETF), Regulation is blessing for crypto entrepreneurs and companies, because it will provide clarity and fuel further market growth.

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Ilias Louis Hatzis is the Founder & CEO at Mercato Blockchain Corporation AG. He writes the Blockchain Weekly Front Page each Monday.

Financial Inclusion Party – Top 7 startups to follow


Appa, have you finished saying “this is good about you, this is bad about you” is how my 5 year old enquires about my VC job. I am sure there will soon be a time when I explain to her that its not quite as binary as that.

The next generation of entrepreneurs really have it in them to rebuild the world, and they really care about and believe in what I often call Inclusive Capitalism. I love my job because it gives me a sneak peek into the future, and gives me an opportunity to be part of the transition.

The journey of the past three months with Crowdcube, Deloitte and Linklaters through the Thrive for Fintech programme has been a great learning experience. The last couple of months have made me love my job even more!!

To quickly put the programme in numbers – we (Green Shores Capital), set out to invest upto £500k in Financial Inclusion firms, spread over 2-3 firms, in partnership with Crowdcube, Deloitte and Linklaters. The programme was announced in early December.

More than 70 companies wanted to apply for the programme. Just over 50 applications were accepted. Green Shores team then spent time with these firms to choose 7 for the final pitching event. The final pitch happened yesterday. It was amazing to see a diverse mix of Entrepreneurs, from London, Bristol, Edinburgh, Israel and Haiti come together.

It felt more like a celebration of Financial Inclusion, than a pitching event

These were the firms and their themes

Stork Card – A firm focused on young parents, who have just stepped into the expensive yet rewarding journey of parenting. They provide proactive financial services, and other childcare benefits through data analytics. Their go-to-market is interesting, as they partner with corporates to provide Stork card services to their employees. This helps employee retention, especially through the child birth and early years of parenting. I just could relate to their story straight away!!

Tickr – A startup that offers impact investing through a robo advisory angle. Impact investing has been largely an institutional play all these years. Tickr have two asset managers who have come together to bring institutional quality investment opportunities to the retail audience. They also narrate the impact that investors have made through their investments in different parts of the world.

Tumelo – Tumelo are also a robo advisor for retail investors to access impact investing. They take a different approach to their business model, where they call the robo advisory capability as just a means to an end. Through partnerships they have cracked with top NGOs and charities, they also want to allow retail investors to have a voice in the board room of top corporates.

I must stress this, and I don’t intend to give any team special treatment here.

It was so much fun talking to Tom @ Tickr and Georgia @ Tumelo. Both are trying to solve similar problems, but have a whole different approach to it. It is going to be super exciting to follow them through the next few months and years.

Confirmu Confirmu use psycho analytics and AI to the credit scoring world. They have a proprietary chat system, which is part of their customer onboarding process. When an individual, who doesn’t have a credit file wants to borrow, often the request is rejected because the lender doesn’t have a clue on whether he/she intends to repay. The chat process includes questions, pictures, emojis and voice recognition in 5 languages, and gives a score on the borrower, that will help the lender make a decision. Special thanks to Yatir @ Confirmu for traveling from Israel to meet us and for the event.

ITI Group : ITI Group was founded by a group of bankers who feel there weren’t a good reliable retirement plan. They also feel strongly about onboarding people into the habit of saving very early in their lives. They have a debit card solution, which will yet again be a means to an end, and a clever go-to-market, with some exclusive partnerships to onboard customers. However, the retirements plan they offer is differentiated from the crowd, and when the two capabilities (retail end and retirement fund end) are put together, they are a compelling use case.

Money DashboardMoney Dashboard to most UK Fintech followers need no introduction. They are the top UK personal finance management app, and they have won awards and accolades for their work in this space many times. So whats so special? Closing in on 100,000 customers onboarded, data richness, and a very decent annual recurring revenue. I am not going to say more here, I will let you do your research.

AgriledgerLast but in no way the least, Agriledger are providing economic identities, and supply chain finance options to Farmers across the world, using Distributed Ledger technology. Through their solution, they bring transparency to the food supply chain, and in the process making sure, the farmer is the owner of the food, and the end consumer buying the product has complete transparency of the journey and quality of the food. They have already got a contract with the World Bank to deploy the product in Haiti.

With so many exciting and varied use cases, we now have the enviable job of getting to the decision of where to invest. Watch this space!!

Arunkumar Krishnakumar is a Venture Capital investor at Green Shores Capital focusing on Inclusion and a podcast host.

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