Event Highlights: Bloomberg Financial Innovation Summit – November 4-5, 2021 – Day 1

Event Highlights

Bloomberg Financial Innovation Summit – Day 1

By Bloomberg Live

While FUD (fear, uncertainty, doubt) continues to dominate headlines — Is there another crypto crash coming? How will ESG, China’s crackdown on tech and El Salvador’s crypto gamble impact the industry going forward? Is the industry trying to reduce its environmental footprint? The truth is that this rapidly-maturing industry is showing no signs of slowing. We’ll talk with top experts about what we can expect to see next in the digital currency space.

Click HERE to view the video of the full discussion.

Speakers included:

- Sarah Al-Dorani, Chief Communication Officer, QFC
- Yoni Assia, Co-founder and CEO, eToro
- Cynthia Bahati, Artist, Web3 Educator, Advisor, My Social Canvas
- Sam Bankman-Fried, Founder and CEO, FTX
- Philip Belamant, Founder and CEO, Zilch
- Ria Bhutoria, Principal, Castle Island Ventures
- BLOND:ISH
- Nic Carter, General Partner, Castle Island Ventures and Co-founder, Coin Metrics
- Marguerite DeCourcelle, CEO, Blockade Games
- Meltem Demirors, Chief Strategy Officer CoinShares
- John Duigenan, Global CTO, VP, and Distinguished Engineer, Banking and Financial Services, IBM
- Tonya Evans, Professor, Penn State Dickinson Law School
- David Frazee, Managing Partner, Richmond Global Ventures
- Tim Gokey, CEO, Broadridge
- Gene Hoffman, Chief Operating Officer and President, Chia Network
- Henk Jan Hoogendoorn, Chief of Financial Sector Office, QFC
- Micah Johnson, Artist and Creator of Aku
- Jeff Jones, CEO, H&R Block
- Stani Kulechov, Founder and CEO, Aave
- Max Levchin, Founder & CEO, Affirm
- Sarah Levy, CEO, Betterment
- Joe Lichtenberg, Director of Product and Industry Marketing, InterSystems
- Caitlin Long, Founder & CEO, Avanti Bank & Trust
- Lisa Mayer, Co-founder, Boss Beauties, Co-founder and CEO, My Social Canvas
- Ryan McCormack, Factor & Core Equity ETF Strategist, Invesco
- Nate McKervey, Head of Blockchain and DLT, Splunk
- Jean-Marie Mognetti, CEO, CoinShares
- Paul Murphy, Partner, Lightspeed Venture Partners
- Erikan Obotetukudo, Founder and Managing Partner, Audacity
- Anna Paglia, Global Head of ETFs & Indexed Strategies, Invesco
- Commissioner Hester M. Peirce, United States Securities and Exchange Commission
- Zac Prince, Founder and CEO, BlockFi
- RAC
- Yorke Rhoades, Director Digital Transformation, Blockchain, Cloud Supply Chain, Microsoft
- David Ripley, COO, Kraken
- Camila Russo, Founder, The Defiant
- Michael Saylor, Chairman and CEO, MicroStrategy, Inc.
- Elizabeth Stark, CEO and Co-founder, Lightning Labs
- Marcus Swanepoel, Co-founder and CEO, Luno
- Dmitry Tokarev, CEO, Copper.co
- Leah Wald, CEO, Valkyrie Investments
- Anatoly Yakovenko, CEO, Solana Labs

Bloomberg Participants:

Eric Balchunas, Senior ETF Analyst, Bloomberg Intelligence
Sonali Basak, Financial Correspondent, Bloomberg
Romaine Bostick, Anchor, Bloomberg Television
Dani Burger, Anchor, Bloomberg TV and Radio
Akayla Gardner, Reporter Bloomberg News
Katie Greifeld, Anchor, Bloomberg Quicktake
Caroline Hyde, Anchor, Bloomberg Television
Stacy-Marie Ishmael, Managing Editor, Bloomberg Crypto
Carol Massar, Anchor, Bloomberg Television and Radio
Mike McGlone, Senior Analyst, Commodities and Cryptocurrencies, Bloomberg Intelligence
Matt Miller, Anchor, Bloomberg Television
Joanna Ossinger, Global Markets Editor, Bloomberg News
Anurag Rana, Senior Analyst, Software and IT Services, Bloomberg Intelligence
Taylor Riggs, Anchor, Bloomberg Television
James Seyffart, ETF Analyst, Bloomberg Intelligence
Alix Steel, Anchor, Bloomberg Television
Tim Stenovec, Anchor, Bloomberg Quicktake
Joe Weisenthal, Executive Editor for News, Bloomberg Digital
Renita Young, Anchor, Bloomberg Quicktake

Event Highlights

The Big Picture Panel

The summit began with breaking news from Caitlin Long, Founder & CEO, Avanti Bank & Trust, who revealed that her board voted the night before, Nov. 3, to file for FDIC insurance, which will make it a test case in the mushrooming cryptocurrency space. Long said traditional banking should not be given an advantage as stablecoin issuers come under regulatory purview.

Nic Carter, General Partner, Castle Island Ventures and Co-founder, Coin Metrics, said consideration needs to be given to the start-up sector that initiated stablecoins. “They don’t need to be regulated as banks are, requiring a one-to-one backing with assets. That would make it immensely difficult for them,” Carter said, adding that it is a misconception that they are not already regulated by other means.

El Salvador’s recent adoption of Bitcoin as its official currency is backed by law that puts it on the same level as existing currency, said Michael Saylor, Chairman and CEO, MicroStrategy, Inc.

The destiny of Bitcoin, Saylor said, is that it will replace all gold ETFs in the next few years. Major banks matching gold reserves with Bitcoin will take it to the next level,” Carter said. What will take Bitcoin to the next level? Fair value accounting and spot ETF approval, Saylor said. Allowing banks to hold Bitcoins on balance sheets, Long said.

In Conversation With Commissioner Hester Peirce

Hester M. Peirce, United States Securities and Exchange Commission, who embraces her ‘Crypto Mom’ nickname, said Bitcoin spot ETFs are being delayed from becoming the basic monetary index of the world mainly because they look so different from the regulated securities market. Stressing these are her own views, she spoke to the realities of regulating cryptocurrency, such as the need to protect investors differently, the tremendous amount or work it would entail and that it’s an emerging, big, industry sector inviting a lot of interest by those wanting a “piece of the regulatory pie.”

Needed most, for investors and regulators, is education by “non-boring” means.

Responding to the analogy of this regulatory regime as a child, Peirce said it’s still in its infancy, but needs to be allowed to grow somewhat freely, “without having regulations that tell them every move to make.”

Going Big: In Conversation With Yoni Assia

Yoni Assia, Co-founder and CEO, eToro, was not the only company leader to state cryptocurrency is at a growth inflection point. Five years ago, eToro had five million users, grew by that same amount last year alone, and by even more in the first part of 2021. Why? Zero-percent interest rates, a flood of newly-printed dollars, low buy-ins and a preferred user experience for Gen Y. “People need to find alternatives to make their money work for them,” Assia said. “The value of money is the widest discussion in human history.” He spoke about eToro’s transparency that allows traders to view and mirror strategies of other traders, including himself.

The Evolution of the Robo-Advisors: In Conversation with Sarah Levy

Curiosity is driving retail investing to a large degree, as well as the companies they invest in, according to Sarah Levy, CEO, Betterment, as is being part of social solutions. Climate tops the list of the largest faction, the 30-ish age group. “They want their voices heard, ” Levy said. “We need to channel the energy of this generation. We survey them and aggregate their voting power. They are voting with their dollars.”

The Rise of DeFi: Where Will it Go From Here?

Discussion included a look at the best and worst aspects of decentralized finance. It’s early and risky, with scammers setting some of the tone, said Camila Russo, Founder, The Defiant, who is looking forward to a new and better financial system that will be global, more transparent and more efficient.

Dmitry Tokarev, CEO, Copper.co, said consumer protection is needed, but the technology side is “extremely powerful.”

More opportunities for protocol and product innovators, broader investor involvement and the development of new risk management tools are some of the upsides, said Stani Kulechov, Founder and CEO, Aave. “On the downside, I see only challenges, such as security of transactions and educating a wider audience. A better understanding of finance will be key to keeping the momentum going.”

Future of Investing: The Digital Future

In introducing the next panel, Ryan McCormack, Factor and Core Equity ETF Strategist, Invesco, spoke to the “widening gap” between traditional and digital investing worlds, and the potential the latter has for widespread applications to daily life and innovation around the globe.

Beyond the Headlines: Building the Digital Future

We are at a “crossing the chasm” moment, said Yorke Rhoades, Director Digital Transformation, Blockchain, Cloud Supply Chain, Microsoft. “It’s not a question of how the technology works, but the best users.” Rhoades spoke to sustainability, noting Microsoft’s real life comparisons, using objective data, to determine carbon footprints within the crypto space.

Nate McKervey, Head of Blockchain and DLT, Splunk, expanded on that, stating that a large number of executives are skeptical because they don’t understand cryptocurrency, calling it a journey from fear by non innovators of the unknown and of potential business disruption.

Speaking about how companies can include stablecoins in new ways, Rhoades said some regulated stablecoins can be used for payments. McKervey added that the attraction there is net 30 days to net 30 seconds.

Solana Rising: In Conversation With Anatoly Yakovenko

“A billion people empowered by cryptology will transform the world; how we do finance, how we do art, how we do everything,” said Anatoly Yakovenko, CEO, Solana Labs. He spoke about decentralized, open-source blockchain and Solana’s focus on speed of data transfer, and so-called competitor, Ethereum. “Both are ecosystems that will grow and thrive with their own visions.”

Bloomberg Intelligence Presents: ETF Outlook

With $722 billion flowing into ETFs daily, old records are blown away, said Eric Balchunas, Senior ETF Analyst, Bloomberg Intelligence, adding that they are bolstered by “bench players finally scoring.”

Passive equity and Bitcoin are two motivators, according to James Seyffart, ETF Analyst, Bloomberg Intelligence, who said the real trend is active to passive, high-cost to low, who noted the first Bitcoin ETF in the U.S., launched 10 days prior, grew from $470 million to about a billion dollars on the first day.

Innovation in Capital Markets: In Conversation With Tim Gokey

“Disruption always leads to innovation,” said Tim Gokey, CEO, Broadridge, in reference to the pandemic. Yet, he stressed, it’s been happening for a long time, a notable point way back in the 1960s, when the stock exchange started closing on Wednesdays to allow traders to catch up with demand. Democratization is the big trend right now, and he predicts a “tremendous growth” of positions on the stock market, across all industries, along with a dramatic increase in shareholder voting that began during quarantine. “Shareholders got to be part of corporate governance, to be ‘in the room’ with online meetings,” Gokey said. He expects that inclusionary trend will continue.

Focus on Bitcoin

As researchers of Bitcoin, these panelists “fell down the rabbit hole” of its possibilities. Marcus Swanepoel, Co-founder and CEO, Luno, said he was attracted by the technology that could solve problems in the market and how it is lifting people out of poverty. He is concerned that banks are de facto regulators, and are pushing back and creating risk by making their own decisions, regardless of broader regulations.

Ria Bhutoria, Principal, Castle Island Ventures, spoke about how crypto assets create options in localized, developing markets, particularly in southern Asia, Africa and South America.

David Ripley, COO, Kraken, described how his company is partnering with businesses in developing countries and how cryptocurrency facilitates that. He noted that security is a significant responsibility in the industry. “With about $40 billion in assets, our security team is pushing 100 members now. Regulators around the world are taking different steps. We’re starting to see competition between regulators and governments we’ve never seen before. They are jockeying for position in a global economy.”

Jean-Marie Mognetti, CEO, CoinShares, spoke to cryptocurrency’s impact on capital markets, saying we are “at the dawn of a brave new world,” with hundreds of pure crypto companies worth a total of $120 billion. “With 300 million people globally owning crypto, It’s becoming a political issue,” Mognetti said, adding that CoinShares’ framework will change the financial stack, which will be powered by the Bitcoin network.

The BTC ETF: In Conversation With Leah Wald

Spot ETFs were a major topic. Leah Wald, CEO, Valkyrie Investments, said it is the holy grail because it would hold the physical Bitcoin, rather than futures, “which is much more exciting to people in the ecosystem.” She predicts the first spot ETF trade will happen next year, that Bitcoin will continue to define the narrative for technology and offer women more room to rise up the ladder “much faster than they would elsewhere.”.

What’s Next for Lightning Labs: In Conversation With Elizabeth Stark

Elizabeth Stark, CEO and Co-founder, Lightning Labs, spoke of her passion for a creator economy and how online transactions using Bitcoin factor into that. Start-ups and emerging markets are enabled by the technology, with the latter finding themselves in the unique position of leap-frogging legacy systems they don’t have – bank accounts, debit and credit cards – and going straight to mobile phone apps. Stark predicted Bitcoin will soon evolve from buy-and-hold to a monetary network, with the focus not on value, but the number of users, with the cryptocurrency fading into the background.

InterSystems Sponsor Spotlight: Seeing Around Corners: How a Better Data Strategy Can Give Visibility to Every Corner of Your Enterprise

“A single, consistent pane of glass,” is how the Enterprise Data Fabric strategy works, said Joe Lichtenberg, Director of Product and Industry Marketing, InterSystems. It offers real time visibility and a comprehensive view of systems and risks that allow companies to be prepared and ready to react to disruptions in-house and external, such as with the supply chain. It creates predictive, learning models and AI algorithms.

What’s Next for Bloomberg Crypto?

Stacy-Marie Ishmael, Managing Editor, Bloomberg Crypto, jumped straight into the fray, coming onboard Bloomberg as cryptocurrency interest was ramping up in a big way. “We’re taking it seriously as an asset class and investing in more coverage.” The DeFi element is a personal interest and a Bloomberg strength, she said. Bloomberg continues to build out its global team, Ishmael said, which is able to report from an already informed space.

Bossed Up: Changing the Game in NFTs

Celebrities like Reese Witherspoon and Snoop Dog may be lending Boss Beauties buzz right now, “but there’s been a lot of work behind the scenes for many years,” said Lisa Mayer, Co-founder, Boss Beauties, Co-founder and CEO, My Social Canvas. She spoke about non fungible tokens and of the thrill of being featured on the Nasdaq billboard for Day of the Girl, of supporting women entrepreneurs, and providing scholarships and mentors. Up next is the launch of a book club “to share stories of incredible thought leaders.”

Cynthia Bahati, Artist, Web3 Educator, Advisor, My Social Canvas, spoke about the female-led NFT project and efforts toward a female narrative going forward. “Representation is so important going into Web3,” Bahati said, going on to describe previous male domination. “Women like myself, women of color, felt alienated and excluded from that, and we definitely don’t want to continue that narrative with Web3 and the decentralized world.”

Bloomberg Financial Innovation Summit is Proudly Sponsored By