Web3 in Financial Services: How Blockchain, Digital Assets and Crypto are Disrupting Traditional Finance

In an unprecedented time of disruption, Web3 in Financial Services cuts through the noise to ensure financial service professionals are equipped with the knowledge needed to benefit from Web3. Web3 in Financial Services explains what Web3 means for finance, outlining its key use cases and exploring the unique business opportunities and challenges it presents. It clarifies key developments such as custody, stablecoins, CDBCs and tokenized deposits, payments, asset tokenization, DeFi and digital identity. Investigating how organizations are testing and adopting these emergent technologies, the book is supported by cutting-edge, real-life examples from incumbents and challengers alike, including Fidelity Digital Assets, J.P. Morgan ONYX, Coinbase, Anchorage Digital, Circle, Ripple and Aave. The book reviews what's at stake for major ecosystem players such as banks, investors and regulators and appraises the changes still needed to enable more mainstream adoption of Web3. Web3 in Financial Services answers pressing questions such as: what does Web3 really mean for financial services and what are the use cases with potential for disruption? What are the innovations that companies are actually doing within this space? And how do organizations need to adapt? This is an essential read for finance and fintech professionals, bankers and investors who need to grasp the essentials of Web3, blockchain, digital assets and decentralisation and its ramifications for financial services. Cover Contents About the author PART ONE Early days: Web3 and financial services 01 Introduction Disruptive innovation Web3 innovation: from scepticism to embrace My story Why now? Insights from experts Book structure Endnotes 02 What is Web3 and why does it matter to financial services? More than crypto Demystifying Web3 Digital transformation in financial services Web3 impact on financial services Financial services players in Web3 Web3 criticisms Future outlook Summary of key points Endnotes PART TWO Emergent use cases driving change in traditional financial services 03 Custody Custody Digital asset custody Digital asset custody in action Opportunity for traditional custodians Challenges of digital asset custody Risk management, controls and segregation of duties Future outlook Summary of key points Endnotes 04 Evolution of money and payments Evolution of money Web3 digital currencies What’s wrong with TradFi payments? Web3 alternative payment rails Web3 payments in action Emerging markets Future outlook Summary of key points Endnotes 05 Tokenization What is tokenization? Why tokenize assets? Tokenization in action What’s holding it back? Exponential opportunities A note on cash tokenization Future outlook Summary of key points Endnotes 06 Lending and borrowing Revolutionizing traditional lending and borrowing Decentralized lending and borrowing Centralized lending and borrowing Lending and borrowing in action Incumbents and decentralized lending protocols Challenges and vulnerabilities Future outlook Summary of key points Endnotes 07 Digital identity Legal identity Digital identity Identity in financial services Decentralized identity Decentralized identity in action Financial inclusion enabler Future outlook Summary of key points Endnotes PART THREE The major players in Web3: opportunities, challenges and implications 08 Traditional institutions and the adoption of Web3 Incumbents leading the way Public vs private blockchains: which will prevail? How to respond and extract value Future outlook: end state Summary of key points Endnotes 09 How DeFi is reimagining finance Reimagining finance Evolution of the DeFi ecosystem Centralized finance (CeFi) Decentralized finance (DeFi) Future of DeFi DeFi, CeFi and TradFi: interconnected systems Future outlook Summary of key points Endnotes 10 Investments in Web3 How traditional players are betting on Web3 How tokens could change investment Investing in decentralized projects Investing in Web3 vs Web2 Market maturity Future outlook Summary of key points Endnotes 11 The regulatory perspective of Web3 Calls for regulation Why do we need regulation? Challenges in regulating Web3 Existing frameworks Future outlook Summary of key points Endnotes PART FOUR Moving forward 12 Industry changes needed for mainstream adoption of Web3 Regulation User experience Technology and infrastructure Will Web3 ever have a ‘ChatGPT’ moment? Future outlook Summary of key points Endnotes 13 Web3 and the future of finance The bigger picture Will we need banks? Past, present and future Perception of new technologies To progress, we need to solve the PR problem The quest for Web3 and the future of finance Future outlook Embracing the future Summary of key points Endnotes Acknowledgments Index In an unprecedented time of disruption, Web3 in Financial Services cuts through the noise to ensure financial service professionals are equipped with the knowledge needed to benefit from web3. Web3 in Financial Services explains what web3 means for finance, outlining its key use cases and exploring the unique business opportunities and challenges it presents. It clarifies key developments such as custody, payments, asset tokenization, DeFi and digital identity. Investigating how organizations are testing and adopting these emergent technologies, the book is supported by cutting-edge, real-life examples from incumbents and challengers alike, including Fidelity Digital Assets, JP Morgan ONYX, BYN Mellon, Securitise and Fireblocks. The book reviews what's at stake for major ecosystem players such as banks, investors and regulators and appraises the changes still needed to enable more mainstream adoption of web3. Web3 in Financial Services answers pressing questions such what does web3 really mean for financial services and what are the applications we really need to care about? What are the innovations that companies are actually doing within this space? And how do organizations need to adapt? This is an essential read for finance and fintech professionals, bankers and investors who need to grasp the essentials of web3 and its ramifications for financial services.