 Here we are. So I'll go through the policy and all the other things involved by industry competitors and it is the intention of the foundation to conduct all of its activities in accordance with applicable and traditional laws. It is therefore extremely important that the attendees adhere to meeting agendas and be aware and not participate in any activities that are prohibited under applicable U.S. state, federal or foreign antitrust and competition laws. Examples of types of action that are prohibited at Linux Foundation meetings are described in the Linux Foundation antitrust policy. If you have questions about this message, please contact your company council or if you are a member of the Linux Foundation, feel free to contact Andrea up the globe at the firm, get me up the profile which provides legal counsel to the Linux Foundation. Hyperledger is committed to creating a safe and welcoming community for all. For more information, please visit our hyperledger.com Here we are for the very last missing of 2020. We have a pleasure to guest Stefan the Mayor and Roland Kurtivo. So guys, I'll leave it to you to have a speech about the electronic promissory, no symbols but to change. So let's have the presentation and have the speech. First of all, welcome to both of you. Nice to have you here this morning. Yeah, thank you very much Andrea, it's a pleasure being here. As Roland mentioned before, I will start showing our electronic promissory notes as a use case for what Roland presents later, the so-called Swiss trust chain. So I think you should see my screen in the back now. Maybe just a few words to myself. As a person, I'm a co-founder and Chief Product Officer of FGX. Otherwise, I'm an attorney at Laudanotri Public in Switzerland. I worked a while in the insurance industry, then I moved to academia for a PhD on blockchain and securities law. So how can you digitally transfer rights by using blockchain-based crypto tokens? And I finished 2018 and then I worked a couple of years with MME, one of the major fintech law firms in Switzerland. And we are around 90 lawyers at MME and 30 of them are purely focused on blockchain and DRT projects. And so a lot of tokenization, DRT trading systems, etc. And now as of 2019, together with my colleagues, I'm focused on one of the most paper-based instruments in the world, the promissory notes. And I'm happy to show you the current status of FGX and how you can use those electronic promissory notes. So the claim is very simple. FGX is an infrastructure provider. We enable corporations to issue sign and transfer those electronic promissory notes, which we call e-notes, therefore making liquidity accessible. And to also show you kind of the overall picture and the starting point for our promissory notes is on the one side the trade finance gap. All of you, I'm quite sure, are fully aware of this the trade finance gap. You have a complex fragmented system in the era of trade finance. It mostly relates to certain jurisdictions. It's also from time to time an outdated infrastructure. So this is the trouble on the one side and on the other side of the investment plight that a lot of, especially institutional investors seeking for investment opportunities. And in the past, especially in the past, we had this very nice and powerful instrument of the promissory note. The promissory note is, as you know, an unconditional promise to pay. And it has several substantial advantages. So first of all, you have a globally standardized legal framework. So the law in regard to promissory note is almost the same, be it in the U.S., be it in Switzerland, be it in Asia or even in Africa. That's due to the fact that this instrument is so old during the time we had a global standardization. Secondly, this instrument is both a payment and a credit instrument. So you can pay by using a promissory note, but it can also be used as a credit instrument. And thirdly, it has a very high level of legal enforceability. That's because of the fact that it's an unconditional promise to pay. So if you use this instrument in a supply chain finance scenario or as an alternative, for example, factoring, it's unrelated to the underlying contract. So you as a holder of this promissory note, you are sure that you receive the money and you do not have to care whether the underlying contract was fulfilled or not. And then fourthly, of course, it's simple. As you will see, that's generic and it's a transferable, tradable instrument. So these are the advantages. Then on the other side, in the meanwhile, it almost died out because of these disadvantages. The law prescribed a paper certificate, so you need the paper. You also needed a handwritten signature. You had to send it by post. It was not forgery proof. So in conclusion, it was extremely cumbersome to use those promissory notes. Mainly because of the legal basis and what is now changing is precisely on the one side this legal basis and on the other side also the technology. And now we have some substantial influence or substantial associations and consortia focusing on the digitization of promissory notes and negotiable instruments in general. For example, ITFA has an initiative, BAF, this focusing precisely on this based on Delaware law. So we see now a global tendency in regard to digitization of these instruments. And in the meanwhile, we also have a proper legal basis allowing to issue and transfer those instruments electronically. And as of 2019, we've built an infrastructure and also a platform precisely to issue trade sign and transfer those E-notes. Where can you use those E-notes? That's then the obvious next question. Our focus are not only corporations which still use those promissory notes in trade relations. We are convinced that this promissory note, this E-note, can also replace certain or quite a lot of trade finance approaches currently existing in the area of factoring, reverse factoring, but also in regard to dynamic discounting. It could even be used as a replacement or as a substitute for commercial papers. So we are believe that E-notes have the potential to disrupt certain approaches and on the other side as it's a very simple global instrument, which is also cheap to use. We're convinced that we can wide the global market by providing E-notes. What use cases do we anticipate? So in essence, there are two different use cases we distinguish. On the one side, the trade loan, it's kind of a more corporate, could be a more corporate finance transaction. Here the use case is very simple. You as a corporation, you issue the E-note, you sell it to an investor for a certain discount and then the investor can either wait until due date and then he gets paid or it's a transferable negotiable instrument. He can transfer it to any other party at any time. The other major use case from our perspective, also one of the most promising use cases is below the supply chain finance area. So here you always have an underlying trade relationship, buyer and the supplier and then the buyer in this scenario is issuing an E-note. He's paying its supplier by using this E-note and then the supplier can in an integrated process directly further transfer this E-note to an investor. And from our perspective, that's a win-win-win scenario. So from the perspective of the buyer, what you can do, you have two steering possibilities. On the one hand, you can vary with the due date of the E-note. So the E-note due date can be after the due date of the invoice. So this means you can extend your payment terms and your payment goals very, very flexibly and easily. That's one perspective. Secondly, you can also earn a discount. So E-note face value can be lower than the face value of the E-note. So this is the steering perspective of the buyer. Then the supplier in the middle, he has an obvious interest. He directly receives liquidity. He does not have to wait 30, 60, 90 days depending on the jurisdiction. And then thirdly, the investor on the right side, he holds an unconditional promise to pay. So in contract to factoring where you have to care about the underlying trade contract, whether it was fulfilled or not, you have an unconditional promise to pay with a very high level of legal enforceability. You can enforce it in currently 165 countries in arbitration model and it's a transferable asset. So you can create the originate to distribute model. So you have a lot of flexibility also in this regard. So from our perspective, this instrument, this promissory note in an electronic form has a huge potential for the supply chain finance market. How is our tech base looking like? So as you see here, we are based on what is called the Swiss trust chain. Since it's the Swiss trust chain, Roland will explain this later on in more detail. It's a solution. It's a hyper lecture fabric DLT with notes at Swisscom in the banking zone and Swiss post also in a banking-grade environment. So it's a redundant system. Our users do not have to care about operating their own notes. At the same time, we can say it's a redundant system with a very high level of data integrity. So we have all the advantages of a closed private system with a high level of data integrity and also we have a very trustworthy partners with Swisscom and Swiss post. So every electronic promissory note is stored on this infrastructure. What we also integrated is a qualified electronic signature. So in our case, just click and accept is not sufficient. So we integrated this legal equivalent to the handwritten signature based on the European EIDA standard and every E-note and every transaction is signed by the parties with their respective qualified electronic signature. That's very easy. You receive then on your mobile phone when you sign on the platform a short message, you insert the pin code and then by doing this, all the E-notes are signed by using this signature and you can also even have a mass signing procedure so that you as a major corporation can use 150 E-notes at the same time making it very efficient. Then the last aspect, how can you use our current system? We have three entry points. So on the one side, we have the platform, you can log in on the platform. On the other side, we provide wide label solutions and then thirdly, this is something we do with large German multibillion corporation, we have the possibility to directly from SAP generate the instruments. The nice aspect with SAP is that there is already standard functionality for promissory note, but it's still focused on the paper instrument. So at the end, you have a print template SAP is generating and what we do is we dock in with SAP, which we take this print file and then we convert it to the electronic promissory note and then you come to our system, sign it and then those instruments are transferred to first supplier and then to the investor. And this is especially nice because then as a large corporation, you can still have all your automated process. Accounting is automated. The invoices are automatically also marked as paid by promissory note. It directly goes into your payment system so we can provide by using SAP a very high level of automation. Here in regard to the specific aspects of our promissory note, what we, for example, have integrated also is an ISIN number. So especially in the more corporate finance money market sector, an ISIN number can be be valuable for institutional investors. So this facilitates the bookkeeping of the instrument. I quickly mentioned it before, an arbitration framework ensuring that the instruments can be enforced in 165 countries. So the elegant aspect with our E-note is we have one legal framework allowing the electronic issuance and transfer of the instrument. Then we combine it with an arbitration scheme and this arbitration scheme allows then the enforceability of the instrument almost in every country in the world. The last country which ratified the New York convention in this regard was the Kingdom of Tonga. So even in Kingdom of Tonga, you're then able to use this E-note and to enforce it in case that the maker is not paying the deface value. Then maybe the last aspect to where do we stand. We started 2019. We created a prototype for a demo due to a large German car manufacturer. We since then already onboarded a couple of large corporations, especially in Europe but also abroad. We have one Swiss bank which is onboarded on the system. We have a patent pending for the combination of private permission DLT, the way we authorize corporations and how we integrated the qualified electronic signature. One of the next steps is then we will also integrate a global payment service provider. We're now in the step of closing this contract so that we do not only support the title side with the promissory note but also the money side. I think we can skip this here. At this point I suggest I would hand over to you Roland. You are for us a very important person. You're enabling the secure storing of our E-notes on your redundant system at Swisscom and SwissPost. I would hand over to you. Thank you very much. Thank you very much, Stefan, to give me all the chance to present our infrastructure offering we do have. Can you see my screen now? All right so I don't want to do it too long then. All right so yeah what we've done actually just looked it up in Google so it was in December 2018 that we announced this offering in Switzerland. It was December 2018 was the global forum in Basel Switzerland. We announced this private DLT infrastructure so we came together with Post some three years ago and really had this idea to to provide in Switzerland the distributed network so a private permissioned network. We chose Hyperledger Fabric to do this. Today we do have applications running on it so we offer it also for a proof of concepts but also for enterprise applications. It's run in tier four data center so we have this that's like the highest tier you can get so we always talk about enterprise grade it's even bank grade so it's running at post finance that's the financial branch of post of the post group and it's running in Swisscom banking data center so there's two partners and each has two notes so we're having a total of four notes at the moment. We do are in in an evaluation of a third partner so I can also publicly not announce the third partner yet but we are in closed talks with six so the Swiss exchange and there's a good chance that they might join this and this will also add up to give us some more traction than in the market. So any enterprise that is having real special requirements concerning either security data storage regulation can just onboard on our infrastructure so it's open we are open for any international startup for abroad for any enterprise and of course in Switzerland so the data is stored in Switzerland it is we are two trusted party and will soon be three participants in this network it's based on hyperlatch of fabric 1.4 at the moment but we are just in the middle of upgrading the platform so by February we are on hyperlatch of fabric 2.2. Just to give a little bit more insight about what we do in the blockchain sector in general we do we do have a portfolio of services and solutions we are offering what we are looking right now is the Swiss trust team at the very bottom on the left so that's part of our basic infrastructure services one is called Swiss trust chain just presented the next one is a network as a service that's also hyperlatch of fabric it's rather a sandbox it's run by Swisscom only and the third one is known as a service or a gateway we offer to regulated financial institutions to offer coins or access to public chains to their clients and the next layer is a portfolio of solutions we offer I think one that's quite obvious is digital assets so we just launched we've already initiated the roles of Dauro in Switzerland Dauro is a platform share tokenization platforms for share so that's one thing we did and of course we've done quite some some proof of concepts and also projects with digital objects and in combination of IoT smart contracts as well the newest the newest offering we do have is electronic seals so basically you you certify a document on the blockchain and later on in a use case allows a third party to verify the authenticity of this document on the block last but not least also decentralized identity management so for all for all these use cases in this industry if you follow a decentralized approach you definitely need also a solution to handle your identities and of course identity related data so for that we have a product that is called SSI gate if you would be interested in that one please let me know all right just to give you that's I guess that's the last slide and I just put our references and projects that we did that we did and that we do at the moment on this Swiss trust chain just put them together on a on the slide right here so the third one we've just been looking into fqx and their promissory note the e-note we've just seen this one the first one I mentioned that's daughter that's a digital share platform for share registry for capital increase and also voting or proxy services in terms of general assembly or mayor an interesting customer we do have out of the energy sector so switzman is pushing hard for decentralized energy production and for that our mayor is offering a platform also for automated billing one from the public sector so that's the content up to a thousand what we did there is really to to as today we are offering this document verification service so that was the first proof of concept we did with the online debt collection register extract so just imagine that you want to want to rent an apartment for example and you need you need an extract of your debt collection two projects we are running right now so to prove of concepts that are not are not running on the platform yet but or in development one is what we call green coin a very interesting initiative we are keen really to see this coming out of of the dark and really go live that's a sustainable marketplace that in combination with a near marked stable coin back to the swiss frank the objective there is really to reducing carbon dioxide emissions so a green coin which of course offers the possibility then to just to multiply this and just imagine you would have a near marked stable coin for regional or local products could be the same intention when and the last one the trust wallet or the civil wallet so that's a digital wallet we would like to to offer in switzerland of course for personal documents like driving license or a vaccination or a certificate and then of course i mean if you look at all these initiatives especially the last two you would have a green coin or a stable coin or a near marked stable coin you would have a trusted trust wallet for personal documents you add this up with for example the aura where you would have a tokenized shares if you bring this all together i think that's our vision to have all tokenized objects tokenized objects shares and and documents all in one place so that's really the vision we have yeah that's all from my side i guess we would be open to also get some questions from from all our participants if that's okay it is thank you roland thank you stefan it was very nice and very interesting presentations from both of you do anybody would like to make questions to stefan and to roland all right any burning questions something you want to know maybe also some uh yes i have a question is uh thank you for this very interesting um do you have experience on from a legal point of view how how you convince uh companies you if they go to court um to have the same validity as as paper right and i'm asking because that's something i i used to face myself yes that's an that's an excellent question so we first have chosen our legal framework very carefully also the three out of four co-founders or attorneys at law focus some of them have very reputable in the area of securities law so this is one aspect and then we wanted to avoid the situation that for example a local italian court would have done to check the legal validity of an instrument which might be based on a certain us state law and that's why we combine those instruments with an arbitration clause so every e-note has an arbitration clause the arbitration is then based in switzerland and the nice aspect of this arbitration framework is that there's a new york convention from 1958 on the enforceability of an arbitral awards and this convention has been ratified by currently 165 countries so therefore it's a very easy process if you're holder of this uh unconditional promise to pay you first go to the arbitrer and then as it's unconditional you just have to prove that the other party the maker has not paid then you received the arbitral award and this award can then be enforced as a state court decision in all of those 165 countries and therefore you have a process which also facilitates the enforcement and that making the the instruments be usable on a global scale so that's in essence that's also based substantially on the arbitration model uh you know the last just as a last point i also have to highlight that we are this e-note it's not a contractual rule-based model so there are certain projects also in the market they create those contractual relationships and then you contractually define you both handle the instrument as it were a promissory note but we are really using the the proper legal basis for this instrument and that's also an advantage. Did it answer your question? No it does so you're not following the English law you have this arbitration. Yes based on the on UK law it's at the moment not possible to transfer those instruments electronically. Okay interesting. Where it is focusing on on the moment they also intend to to change UK law we have a different legal basis more focused on the US but as you combine it with those global enforcement scheme you can you really use it on a global scale so we do not have to wait until UK adopted any changes in law in regard to electronic negotiable instruments. Lovely thank you. Stefan one thing i would like to ask you we're talking about promissory notes which are usually you know the instrument on which open accounts are based especially when an ECA steps in the picture what about bills of exchange do you deal with those instruments as well? Yes that's and that's also a very very good question. At the beginning we intended to of course support both bills of exchange and promissory notes then based on our extended legal analysis of the underlying legal basis we decided to focus on promissory notes first because there are some legal advantages which you have in regard to promissory notes which are not existing for bills of exchange however in our supply chain finance scenario based on the flow we implemented you can use the promissory note as a bill of exchange it's just you you have it first issued from the maker in this case usually the buyer to the supplier and then you have an endorsement then to the investor so but you can use this this instrument in precisely the same constellation as a bill of exchange and that's one last point to add in recent time we will also be able to support a real bill of exchange you're muted Andrea. Sorry didn't notice that sorry I was asking these because under different scenarios you know some countries that do not recognize promissory notes others they don't with bills of exchange it's quite patchwork in terms of scenario and often you require to issue drafts which means bills of exchange basically went under a documentary credit outlook that's why I was asking this you know it's not the same thing you know. Yes sir. Yeah I mean here here we're also a bit dependent on the legal basis there's also this one initiative from Unzitral with the model on electronic transferable record so there we also will have an additional legal basis we can use and this is an involvement which yeah in the future we're convinced that there are a lot of different legal frameworks we can use to to issue and transfer those instruments electronically. Tell us to convince everybody to adopt those model laws which you know. Yes precisely that's the challenge at the moment as far as I know it's just a parade which adopted this this model law and there are a lot of other countries intending it but. But at the moment just one. Yes precisely yeah. On the basis of the place and the attendance. Right any other questions? He insisted to know something from myself or from Stefan. Just answered one on education so I hope that this helps you. All right well I guess everyone's happy with the content we provided so that's good. We personally we are happy I mean thanks for the presentation. Interesting one so you show them. All right maybe a general question so how do you see 2020 and going into 2021 in terms of blockchain and your adoption you're seeing the kind of traction you're getting and what are the challenges. Okay so what do you want to know 2022 or 2021. 2021 or 2022 whatever right so how are you seeing. Okay traction how do you see we see we think we've gone five-year journey where are we on this journey from your perspective. From my point of view I guess okay we did have some sort of a little bit of a halt now you can say in the whole development of the market of course due to this COVID-19 crisis that's quite obvious so a lot of we've seen just some real specific cases like this vaccination certificate for example that was really a big news and everything but besides this of course the market slowed down a little bit in general but besides this I think I think what we see is that that the period now or really the hyper is this hype curve. I think what we've seen is really a lot of I would say building of consortium what we've seen is really technical proof of concepts also some solving or some proof of concepts turning around legal aspects just one outlined by Stefan and then of course what we see now is really that the try and error period is over so I think what we see what we will see in the near future definitely next year and then the year after I will expect to see more projects and then real cases going productive that will add value to the users so really adding value and also I think we've solved the technologies if you have think today it's not a big deal to have a chain running up and running to tokenize some objects I think we've solved some English especially in Switzerland like I think we have the lawmakers in Switzerland I think they're very fond now of this technology we're moving forward there so I don't see too much obstacles in this area but where I still see the biggest challenge is really the the nice use cases the good business models really also players stakeholders giving the chance to to earn money because blockchain basically is an efficiency case and and then of course where also I see a potential is really if you combine blockchain with other deep tech so let's say you will see more cases with blockchain or BLT combining with IoT to really make make these transactions you save on the blockchain to make them measurable so whatever you put on the blockchain you could say okay it's somehow measured it's verified and the same goes for blockchain and AI so whatever you can't measure out there at least you can validate this with some sort of AI mechanism so that's my point if you maybe Stefan you want to add yeah to to add in in this regard I fully agree with what's you but you described Roland I think the the market has been consolidating within the last month maybe even even years I think you know in the meanwhile if you're using a BLT or a blockchain the hype period this is obviously over so you really have to focus on the the use case and it's not just that you're using a blockchain that that you will be successful and in in our in our case we we see this quite direct I mean our customers are mainly large global corporations maybe even also financial institutions and investors on the other side and they do not care whether we use a blockchain they just care whether it's a secure whether it's easy whether you really fulfill an economic need whether it's a purpose so this I think these projects will be successful which are very close to a real commercial use case and you have to weigh up between a visionary but you will achieve three five maybe even seven years ahead and what you really can provide in in short time yeah I think that's the so I think there's still too much hype really to say okay there's blockchain in it and to be honest I completely right users don't care so nobody really cares today if you say okay I bought the book on Amazon and it's based on the internet so people say yeah that's nice we know it would be probably the same like in in in five years people would say deal in blockchain yeah it's it's it's there it's here to stay and it's here to be used so see see the same I guess one other challenge is really interoperability didn't mention that one so I guess we still have a lot of technologies and and not to forget it's not only the the intra chain mechanisms that somehow we have to solve so we will definitely also I mean these legacy systems all the ERP systems and there's they're also here to stay they will not they will not go away quickly just so so there we will have the rich the new world and the old world same same for that one and trust I think trust is still I mean blockchain somehow solves the trust gap that we have in all these electronic real-time transaction and and trust will will even the need for trust for trustful networks will increase I think in the time that we are right now we see a lot of fraud happening we see a lot of cyber security initiatives going on so trust will definitely the need for trust will definitely increase yeah any other question Roland you touch very can you hear me Roland no sorry Roland yeah can you hear me now better you you touch very good points I mean when you mentioned the interaction between blockchain artificial intelligence and I would say that's very good points uh sticking to trade and trade finance I mean this is uh would be in my opinion the real deal connected also with the interoperability you just have lots of initiatives but they have to talk to each other let's say so in an efficient way uh in order to recreate what's going on in the physical world right now so the secret maybe recipe is a good mixture of those issues that she mentioned without violating what is the present SESA slash based on abstractness and you know in independence principles that has always been my core interest you know being on the on the legal and commercial side of the of international trade the secret will be when all these I mean a good point success in the future will be the interactions of these technologies without you know not disrupting but evolving the present SESA in a digital way so you you touch very good points when you when you include your speech I mean I do appreciate these secrets over there the future lies in the interaction of these technologies blockchain is a good point it's a good technology but alone you cannot solve the whole stuff the whole problem yeah it has to interact yeah I mean it's just a very efficient way it's a very efficient way to have a trustful network to just store um you can say tempo proof transactions so that's basically it and the rest has to be solved by other technologies right all right so yeah there's no more question I guess for me and Stéphane we would also thank you for participating and yeah to really share your interest together with us I'm just curious actually maybe just one thing is how if anyone's interested I'm from and serves at Swisscom and at QX is how would people get in contact with you have what what kind are you looking for a you're sharing today what kind of connections do you want to make or your just so the Stéphane goes first I just type in my email address in here so probably Stéphane can just answer I'm very happy to connect both via LinkedIn I will also provide my email address and we can also have a bilateral zoom call or conversations if you see any angles to another case you are working on at the moment so we're very happy to to also exchange ideas to uh it's to become challenged so I am I'm very happy to to exchange also doesn't necessarily need to be in regard to uh promissory notes or negotiable instruments but also any uh DLT angle in general yeah for me it's quite short so the presentation I was showing and we're interested um really make our offering if anyone really wants to take advantage of our offering whether it's in infrastructure and running applications enterprise great blockchain applications they were just using one of our building blocks on top like the one I mentioned with the electronic seal for documents for example or or tokenization of assets and feel free to contact me and or one of my colleagues in in Swiss blockchain ecosystem yeah great all right I think that's it thank you all right wrap it up great thank you every do we say goodbye we just meeting leave and give you another 10 minutes just for some work group internals huh yeah have a great Christmas everybody thank you cheers bye cheers bye