So, well, if there are no any other questions, I think we change the scene even will help me with changing the presentation. There is a presentation order for Sebastian, and I would like to introduce Sebastian a little bit more because I think there's lot to say about the second smart young guy, young men. Who's not so young, but you look young just in comparison. May I say this? Okay. But you both look, you look young, but of course I would like to say a little bit more for you as for, for participants in this workshop to yeah. To dignify perhaps a little bit, what, what, what's his experience and you can participate of his experiences when I say who is or what he did already, he's working at the moment for I'm sorry. I do not speak very well. French that's
Okay.
A global management consulting firm for financial service organizations and they are doing this full size of potential financial services with new technologies as far as I understood. Yes, it's, it's
Pretty much like, you know, Deloitte KPMG. Yeah. This, this kind of firm,
But specialized in this
Specialized in finance financial
Services and this covers investment banking, wealth, wealth banking, retail, banking, insurance, and commodities. Very interesting to me, cause I interested in this too. And he's 12 years of experience in leading business transformation projects at the intersection of this technology and business stuff. So it's very helpful for translation. I think many of those young persons in the scene are coming from the called Polytechnique in Paris must be a good must be a very good school for this. You studied there too. Have a master degree in physics, computer science in industrial economy too. Just make yourself aware of this. And he worked, he had managed a large scale enterprise architecture project for the French ministry of defense. So there is much identity in it, I think so. Or perhaps you will explain perhaps a little bit about this had joined T J as a global equity derivate application manager, afterwards project leader of Boston consulting group in France. And now he's head of digital for north America
In charge during the life cycle. I mean the, of, of the, of the, you know, of the relationship between the, the financial service and the client. So it's how to identify, verify the identity, how to really understand the, the, the rate, the risk associated to, to the client and, and then manage the clients, you know, during the, the, the whole period, I mean, for every transaction and during the lifetime. So the problem for banks, of course, the cost is very costly, you know, to, to monitor the transactions, to, to onboard clients and to update the so, so it's a lot of, you know, work. I think the last figure I read was about 12 billion a year. So 10, 10 to 12 billion a year spent on email compliance and KYC. Then of course you have the risk of not being compliant. So more than 14 billion in, in fines.
So being people are of course has a large part of it, but HSBC's done that charter. So like many banks had to pay, you know, huge fines and many inefficiencies, you know, all along the, the process, heavily paper based a lot of time to onboard new clients, a lot of duplication, of course, because for, you have to, you know, replicate the process for every financial institution and then a lack of control. I think this is interesting. It's not only, I mean, I mean, the issue is how do you monitor the changes in the life of, I mean, in the profile of the customer and also from the customer point of view, how do you manage your, your own data that you provide to, to the, the bank? So given this, these issues. Yeah. So I mean, blockchain could be a good solution because it can bring, you know, this, it can, you can audit, you know, the transactions.
So it's really for regulators and for compliance officers, it's easy to, to monitor what's happening. You cannot modify the transactions. So it's a secure, you know, immutable, you know, transactions and, and data. So if you store like information on one client, you cannot modify it. And it's, of course it can bring efficiency because you don't have to replicate the process. You can have, you know, like one record shared with different participants. So yeah, I mean, in the ideal world, we would like to have like a single source of truth. And then that will be shared across the fire, you know, behind the firewall and then anyone can access the identity of the clients. So the clients can access their own identity. And, and, and man, I mean manage it. And of course, financial services, regulators, government. So that's been, you know, that's the, the dream that's now what I want to to do is really focus on emerging solutions.
So startups, you know, and firms that creating new services on the blockchain, and then we see and what, what they can bring. So let's start, you know, step by step. So first, you know, proof of existence. So it's not really identity yet, but it's the first step. So you have a lot of many, many startups, you know, trying to, you know, offering like notarization services. So it means they get authentic a document, you know, timestamp document, you know, the document is timestamped signed authenticated and installed on the blockchain. So many, many startups offer the service. So, I mean, maybe you don't see very well the, the graph here, but so I use KCO KCO is a, a French startup and they have like an Explorer of the blockchain. So you can, so you can see the, I mean, the transaction and you can also monitor the non blockchain transactions.
So such as the, so when, when you time stamp, you know, an information on the blockchain, then there will be a trace. It will be stored within the transaction. So you can monitor, you can that. So we can see that some of these startups are active, so they actually they're actually used, and you can, you can really monitor them. Some of them, I didn't see any trace. So maybe they use a different protocol or they, they are just, you know, just launched and they don't have like an operational service yet, but from already from, you know, using that, you can, you know, you can, you know, try to design, you know, interesting solutions. So block notary, they have like an interview process. So you, you can do a video of yourself and then you, you will show you identity card on the video. And then this, this video will be, you know, the, like I said, so timestamped signed, it will be stored. So the, the, yeah, then it can be accessed and it can, it can be, it can be used as a proof of who you are. It's not, it's not, I mean, it's not, it's, it's being under construction, so it's not, it's not live yet. But I mean, I think they, they are trying to, they have a partnership with, I don't remember if it's a Russian or I think Eastern Europe bank to try to, to, to, to, to launch a proof of concept. Then if you go one step further, we can create, thank you very much.
So one step further. So digital identity on the blockchain, you have two, two men services, so one name and, and beat nation. So, I mean, so one name is very, very basic service. So you can create an identity and then based on your public profiles. So it's based on, you know, linked Facebook, Twitter, and GitHub, and based on that, they create an identity for you. And then this identity is store stolen on the blockchain. So, and then, like I said, when it's store, it's unique, you know, change it. So it's really a proof of who you are, but it's just based on, you know, Twitter. So it's just, and then, but they, they have like some ambitious plan because they, they want later on, once you have this entity to use it as a password, you know, and a notification mechanism for other services, you know, online services, but they are currently, you know, it's currently under development bit nation is, is, yeah, it's very ambitious project because it's more than identity.
It's really to create decentralized organization and decentralized nation. So you can create a world citizen ID. So I create in mind, so this is my idea on one name, and this is my ID on the, on big nation. So yeah, you, so you give information about yourself and then all this, this information, you know, there will be a hash of this information and you get your private key and you have a public key, and then you, you are identified on the, on the network again, that's, that's okay. You can create an identity, but today's can only be used within the scope of the nation. So it, the, you cannot use it. I mean, for any other service, but they're working with the Estonia. So I guess, I mean, all of you must must know this use case. So Estonia are pretty much advanced and imagine digital identity.
So all the citizens, they have digital identity, but even you can create, you can be a I resident. So it means they will give you a special identity and, and bit nation provide a service. So again, you will, you will have an identity and then you can do business. You can declare some tax and you know, can do many things. So it's, you know, it's to create a bit of, you know, try to incentivize people to come and, and do business in Estonia. But of course it doesn't, it's, again, you cannot use it. It's not a passport, so you cannot enter the country with it. You cannot travel. I mean, you can only use it for business purposes in Estonia, but I mean, that's, that's already something, you know, it's, it's, it's working, it's implemented. So maybe that could be something, you know, that could grow and become, you know, grow yeah. Everywhere elsewhere. So now we are moving to more, let's say cowboy C use cases. So Kar and then travel.
They, they are, they're pretty much based on same, same, same logic. So we struck out so you can create, so it's based on, you know, it's a mobile app and then you can really, you have your data. You have, you will have a private key and same, so same principle you can store, you know, on the, on the blockchain hash of this information. So again, it's signed, it's, it's, it's a hash of your identity, the signature of, I mean, it's a hash of your identity. The first time that the user will wants to the business with the financial service, the financial service, okay. Will get the data with the public key, we'll check the hash, and then you need a certification. Of course. So the first financial service will be used as a certifier. And then the certification, the first certification is stored also on the blockchain. So then for the second one, then you don't need to, to, to do the certification again, you will have, the user is already identified and certified. So then the second financial service just need to check the information store on the blockchain and compared to what the user will send,
Let basically the ID and for travel. It's kind of the same ID. So actu so actually, so for one specific user, again, it's a mobile app, but this is the internal system of a bank. So a bank cannot, can still store information of a client, you know, the, all the like history, the accounts, everything, and then you, they use a travel server. So they will use, they will implement a server in, within the firewall to manage, you know, the, the relationship with the, you know, the, the client and the internal data, and same, same, same logic. So the hash of the, the hash of your information identity is store on the blockchain. So then, then it can really be shared between, you know, different, different financial services. They can really access check the same information on the blockchain and the user can also check the information.
And if there, for instance, let's say, if there is a change, the situa let's say someone gets married. I don't know any change. Then if the identity is changed, then all the financial services that were already linked with this identity, they will, they will be aware of the change. So no need to replicate to several times. But it was interesting because actually, so, I mean, we work, I mean, we don't have any stake with S Strato, but still we presented them. Cuz part of my job is to introduce FinTech and to, to banks. So we introduced them to, to bank, but, and then there was an interesting discussion about, okay, that's interesting, but you know, you really, so you should, you should be really talking to regulators. You should be talking to because you know, we are already overregulated so we don't want to like try something new.
We are already struggling, you know, to, to, to have a proper KYC. So why we want, why we would like to, to try something new and, and they say maybe if you can convince, convince our clients. So it was corporate investment bank. So meaning the large institutional clients, if you can convince us, like they don't want to move forward. So who is going to move first? Maybe the regulators need to move first and like, you know, design a new standard or maybe the clients or the bank. So it's like, you know, everyone is waiting for the first to make the first move as first person to make the first move. So it was interesting discussion. So travel, but actually that client, they were not interested at all because they were too busy with, with M writers with, with swift already. But I know that they're working with the bank. I don't know if it's public, but they're working with the bank to, to, to implement a proof of concept.
And then we can also mention, you know, few alternatives. So unique ID can C chain creates S so it's kind of the same logic, but different implementations. Yeah. For, for me. So unique ID is not really clear exactly what type, what kind of blockchain they will use. It seems that they will use like a private, a bit of private and public. But what is interesting is that they, they want to focus on internet of things. So it's not only for personal identity, but it's really for anything, any component, any device. So that's, that's their goal and they want to use smart contracts. So maybe they will use a bit of issue, but it's not clear to me. They are very at early stage for K C Chan. Yeah. So they really focus on banking services and they, they use cm to build smart contracts and they have gatekeepers and yeah, so it's under development, but it's, it's pretty interesting credit KYC. They want clearly to, to implement a hybrid infrastructure, mixing, you know, mixing public and private elements. So they, they will really, so you, you will have some notes that will be the validators. So that's why it's a kind of private system. But then, but then of course the, you know, the identity stored can be audited and can be, you know, accessed by anyone, including the customer. So that's why it's been a mix between public and private.
So, so as, so, as we see again, it's a bit early, so many startups are trying to work on identity, you know, on, but it's it's bit early stage the roadblocks. So standards I told about it this morning, but like I said, you know, who is going to create a standard because you need a network effect. So it's not only one bank and, and, and one set of clients. So you, you really need to have like a, an agreement with regulators, with all the banks with, I mean, financial institutions and the clients. So standards is key issue regulation, of course, same. So, and I mean, legal part, what does it mean to have like a digital identity, of course, digital contracts. So many things that, that, that must be, you know, studied from a legal point of view and integration, of course, how do you integrate blockchain technology with your, with the legacy systems?
And of course the non blockchain solutions, because many fintechs are working on the identity. So I guess you are more expert than me, so, okay. We have the, like the regular guys. So swift is creating, is creating a KYC central KYC, M realtor is going to provide aims to provide like a managed service from onboarding to really managing the, I mean, the change in the, in the, in the client profile. And then you have something other fintechs that use just that just don't use blockchain to provide like K YC system. So Google Twilio, and I guess there are many more, but so all in all what's interesting is that in all this, you know, blockchain solutions, you still need someone to certify that's obvious, but you still someone to need someone to certify the identity. Once it is certified, then okay. It can be shared and it can be, it can be shared with different, you know, institutions.
So I guess blockchain in, in this field will never, I mean, you cannot get rid of all the intermediaries because you will still need someone to certify who you are, but still some part of the process can, I mean, you really need to, it can be improved. Of course they are paper based. You have to repeat them. So of course there's many things can be done. You really need a network effect. So that, I think that's a key, the key issue. So if you want to implement like a large scale solution, you really need a, I mean, that's the, you know, the discussion with Strato. So who is going to move first, maybe if someone can really provide a solution, like a very elegant and efficient solution, maybe that will be something very valuable. Maybe you can have a winner take effect. That's, who's going to move first is going to win that. That's not, I mean, I don't have the answer. Okay. Thank you.
Okay. You so much.
Okay. Thank you so much for this brilliant, excellent summary and overview on some use cases, we have 10 minutes left min at minimum to discuss. And I, this is very interesting to get those questions from the audience, please. Any questions so far? Okay. If nobody hasn't question. Yeah, there is 10 seconds. I have the mic Schutze yeah, I,
Yeah. The bottom line of your presentation, as far as I got it is, well, there's nice technologies, nice trends coming up for blockchain for distributed authentication or identification of staff or of clients. But the it's not widely accepted by the audit auditors so far. So how can we get the auditors to accept this technology?
You mean the, the internal auditors in the bank or yeah. And the regulators
Test the internal and external auditors. So how can we achieve that? This trending technology and nice technologies is moving forward?
No, so, I mean, it's like for any innovation or new technology, so that's, I mean the normal process. So you first, you need to really experiment and show the, what, what it can brings. So, and then when you have something valuable, then you have to bring, you know, regulators and compliance officers auditors, bring them in the room and show them the value. And then, you know, it's, it is like a step by step. So
Sure. Understand that, that, have you been involved in any negotiations with regulators myself? Yes, please.
No, no, not directly, you know,
A way of any ongoing negotiations
Already? No, no, not directly. So I know, you know, I talk to people and I know that so banks are working on use cases individually, or sometimes in the work group, you know, there are three, et cetera, and, and regulators are involved, you know, they follow very closely what's happening. So because yeah, again, it's, you need a network effect. So that's why the working in war groups is very important, is very important. No. So I know that there are new regulators there, they are following very closely what's happening. But so like I said, you would take some time if really, so if really we can build a very powerful solution or based on blockchain, then, you know, I mean it's Darwin process. Darwin is process. So maybe the, it will just be so strong that it will be the become a standard, but we don't know yet. And we need still need some time to experiment and to, to see what we can, if it it's valuable or not.
Thank you.
Okay. Perhaps I may make advice. We have some other people here on the, on the conference, Dr. Casting keen who's, who is a lawyer and is especially interested in this area of data security and blockchain stuff. So might be talking to him then in more detail. Thank you. Okay. Any other questions please? Okay. Perhaps I make, that was
One.
I always look away when
Hello. Maybe not as a question to you, but maybe as a question, do we have any speakers who have practical experience with implementing this in a real life scenario?
So you, I mean, in my firm, so we are, we are developing a prototype, but it's not related to identity. So, so we are really working on the prototype because we, we just don't want to talk about it and present PowerPoints, but really, you know, be hands on. But so, but then again, it's just, we are, you know, just to know the technology, how it works. So I don't have experience myself in the implementing a large scale, you know, identity solution on blockchain.
I think, I think you will only find very few ones because if we are in a very early stage, especially in identity management, I think there are several things even addressed in the beginning. We need these accepting third parties, which then serve as a secure of you. Are you or know your customer, as you said,
Like I said, so I know the CEO of travel and I know that they're working with the bank to implement something. I mean, to do a proof of concept. So if it's successful, maybe you will see an implementation in this bank. So if you, I mean, if you're interested, I can connect you with him.
There are.
