 I think we should start right at 10. Two things. One is, of course, we are glad to welcome money to present on the transformation, the automation of capital markets. Other points, a couple of other points. One is, of course, this is under the capital market, say, on the hyperledger. So we are bound by the antitrust, such as it is that exists today in the hyperledger. And please read the Linux Foundation antitrust policy. The other is the Code of Conduct, which says that you have to be reasonable in treating others. And you have to disagree without being disagreeable, basically. And let us hear from money. He's going to start his presentation in a second. Thank you, money for showing up and presenting. And let me stop my video so that you can focus your attention on money. I'm just going to share my screen. Let me know what you guys are able to see the screen now. Yes. Okay. Good. Hello, everyone. Thank you for joining this session on automation of capital markets. I am Manny Pillai. I started OTC Digital. Actually, it is nothing but more an extension of what I've been doing and all in capital markets and interstate swaps and derivatives and cash for the past 20 years. OTC Digital is sort of the latest incarnation of my prior fintech ventures, primarily focusing on bringing automation to capital markets, combining traditional trading platforms, blockchains, ledgers, you know, combining what we are today is of a multivariate ledgers. It's not just building up on a single ledger. We are now working with multiple ledgers. Each one is set up or focused on a certain market segment. So this presentation is a collective effort of all the efforts, all the challenges we've faced over the years and how we try to address. But I try to address this in a more generic fashion and then towards the end we can see if we have time, we can squeeze in a demo. So let me start with, you know, obviously automation is known, very well known concept in capital markets. It's something being in various segments, particularly on the execution side. We have seen a lot of automation over the years, but on the postage side there is, you know, very little of anything of postage automation. And, you know, we'll go through this, you know, the next half an hour or so to see, look at the current market structure, what do we need automation? How do we transform from centralized finance to decentralized finance? That's a very hard and complex topic. Nobody will try to simplify as simple as possible. What is required for transformation? Is it just blockchains? Is it ledgers? Is it data standards? You know, we think it's a combination of all of these things. As we look at the various data standards that exist today, and then how newer emerging are digital standards like common domain model, how that can help in the process for automation. You know, again, as I said, beyond a multi-chain world, more interestingly, the market is shifting more away from private based blockchains to more public and permissioned blockchains, and how capital markets can operate. You know, the concept is very similar to how I would phrase it as how FedEx and UPS uses public infrastructure to deliver goods and services to their clients. In a very similar fashion, banks and broker dealers can really think about using public permissioned blockchains to actually achieve their goals. I will briefly touch on CBDC white paper, which we earlier presented in this hyper logic in capital markets. Finally, you know, look at very specific options on the automation within the securities. Capital markets are a very broad topic. We are obviously not going to touch things on insurance or real estate or, you know, mortgage-backed securities, but let's stick to what's more pertinent to securities. You know, you can stop me anytime. We are happy to discuss in depth where we're needed. So let's start with why do we care about automation? And the best way to answer is the cost. So here is the recent paper written by, you know, published by Accenture that identifies the revenue structure of the various market segments within capital markets. I don't know how to go into the detail that we can look at is the total revenues are close to 1.1 trillion dollars out of which the biggest cost structure is 6.73 billion on costs. And you can see that this is riddled with, you know, legacies and infrastructures. And when banks look at this thing and say, how do I, you know, bring an automation to reduce the cost? So there is definitely an incentive for all market participants to automate as much as possible within the markets, within the various divisions, various desks, inter-desk or intra-desk as well as looking at the inter-party as well. So that there is a big opportunity to reduce costs. And that's the main goal, trust for some of the initiatives towards blockchain. But then of course, we now add in the newer emerging classes like cryptos that adds a layer of innovation and as well as new market opportunities which could only be better addressed through blockchain solutions. And hence, you can really see there is a real impetus for the market participants to squeeze and cost through automation and using effective use of blockchain technology. Just to give you a background, you know, here are a few slides. I'm going to just highlight, see this is something that we all know. And it was presented very often in hyperlogist cap markets about cross-border payments, how it is so inefficient with so many different market players and Swift and CLS and, you know, various different banks and intermediaries, how blockchains and the emerging CBDCs can effectively reduce the time, the settlement cycles, as well as the operational cost. So this is something we all know. I just want to highlight what that is. The second part of it is wanted to show is on the capital markets structure itself. This is again a paper by Northern Trust. By the way, we will make this presentation available on the capital markets side. You can always, you know, get back and look at all these white papers as well. This is what Northern Trust, you know, highlights. It's a much more simplified form of what happens today in the ecosystem today between the various parties from, you know, as you can see here, and what the admission was, what would happen in a decentralized blockchain world, but they name it as an ecosystem 2030, which is pretty far away, if you really think about it. But what we have today is, you know, a lot of these solutions are already in place are, are, you know, almost ready to be integrated and deployed. So you would see these solutions emerging pretty soon. And there are first, like if you could look at DTC solutions for private equity, and then you have all these exchanges from ASX to Deutsche Burst, you could see a lot of these things are early, early versions of a kind of a blockchain network, capital markets network is being formed. So I don't want to go through the details, because we all know the classic examples of the problem existing problems, and what are digital solutions, you know, can help. But the idea is that is, this is not too far away, we are in 2022-23, as you could see the ASX is planning to go alive on 2023, they already started their earlier testing places. So as more and more participants start coming in, you would see capital markets forming a very core base of technologies on blockchain-based solutions over the next few years. If you want to go a more complex is, this is something that I have dealt with in interstate swaps over the past 15 years, as it evolved, and you could see that this is a, you know, very complex infrastructure where a lot of intermediaries play, and they have vested interest in continuing that sort of a game. And it's very complex to unbundle this thing and create a blockchain and, you know, there are attempts, several attempts been made to see how we can bring in, but that's a challenge, how do we, how do we get around this intermediaries, how do you work, make them work with blockchains as a challenge. So it's not like we want to go ahead on with more complex structures like derivatives, but definitely there are big opportunities to start with, you know, basics of cash and lending and we move up the value chain, then these things can also be addressed. Now, any questions, you know, please stop me and we can always discuss in detail if necessary. So one of the challenges is to look at the, you know, is to look back in the mirror and say, what are the problems we face for the, we face for the past, you know, 15, 20 years, and how do we rethink, you know, building trading systems or building workflows between parties. That's why, you know, I put up these challenges, should we even think about the end of day, start of day, T plus one, whereas if you look at the crypto markets, you're talking about instant settlements, it doesn't mean everything has to be settled instantly because credit plays a big role in capital markets. So there is some merit intermediary, which is what we call as a peer-to-peer session-based trading and netting solutions, which means in a blockchain world, a dealer can, you know, create tiers of their clients who are like, let's say the top tier clients could, they could settle more frequently, four hours, eight hours, and then the lower tier clients, they could set up a settlement cycle of, you know, T plus one, T plus two depending upon the type of the profile of the client. So there's no necessity that we should all have to follow one standard formula. Banks can choose or essentially market participants can choose how frequently they want to trade and net and settle. Thus, you know, you can strike a balance between credit utilization and liquidity. Again, looking at the commodity, the various different market segments and desks, you know, do we still look at these things as independent products or should we treat it as a digital token of different characteristics and life cycles? Thereby, you can abstract away a lot of the common elements and this is where a data standard like CDM helps a lot. We will come to that. Again, consortium has become more of a, you know, it's a term of the past, more and more banks are looking at saying how do we all collaborate and create and work with permission networks and essentially create what you call as a cooperative network, compete where you have value and then cooperate where you can. That's the model that's emerging in the market today. Another possibility is, you know, questioning centralized clearing. Again, we can do, it doesn't mean peer-to-peer clearing will update or replace, but it can coexist. So where there are efficiencies to be had, as I said again in the step number one, peer-to-peer session-based trading and clearing, that could actually help, in a way, reduce the dependency on a centralized clearing, which is, again, a time-based T plus 1, T plus 2. So you could have both models. Much like the way we talk about exchanges and decentralized exchanges, both can be complementary. And then again, carrying on the same thought process to, you know, we all built front offices, middle offices, back office systems, the risk management systems over the years and every bank then to build their own. And then they would then, you know, start creating, in order to interoperate between their own desks, they end up creating reconciliation processes within the desks and then across the parties. It's just a big, you know, requires intermediaries to step in and provide those services. In a blockchain world, these can obviously be minimized or reduced or eliminated, whereby once you can define the standards and processes, a lot of this automation can be had. Market data is an interesting concept. There's a lot of push for producing the market data cost. And already we are seeing solutions like Solana, which is actually, there is a network called Pyke Network, whereby all the HFT firms have started contributing market data prices into those networks, whereby you're seeing that purpose-built market data and reference data chain is emerging for capital markets. So it's interesting that if you look at the blockchain evolution from Bitcoin to Ethereum, which became like an all-purpose computer to now what the market is now gravitating towards is purposeful built blockchains, whether it is security tokens by Polymesh, consensus, or it is market data by Solana, or if you look at stable coins, specific stable coins issued by Circle or Paxos, and then obviously we're bringing in CBDCs. So we are now entering into a truly a multi-chain environment and, you know, interacting with all of them is a must and effectively utilizing these networks that will all help us in our sharing automation. Okay, now just to give a very high level, what we are today, from a capital markets perspective, what we are seeing today is a kind of like, you know, a very simplified form of broker dealers and custodians working with their buy side, and then on the other side, you're having exchanges or inter-dealer brokers for execution, securities being governed by CCPs and CSDs, and then the cash on a simple bank. This is what we are in a very high-level operating environment. How do we transition from this world to a DeFi where we are seeing more or less the participants have not changed, but the way they're going to interact in the future changes substantially with the introduction of asset chains, which covers crypto securities, and then you're bringing in the cash, you know, we're bringing in stable coins and CBDCs, and then going along with centralized exchanges, you're now bringing in protocols, automated market makers, lending protocols, and then onwards the higher level on options and even such a product is not emerging. And even interesting thing like a treasury, how today the individual desk within a capital markets interacts with the own treasury department, with the own treasury to manage their day-to-day operations will change a lot because now you're dealing with and from an account-based system, you're switching over to a token-based system. That means even a very mundane task like a treasury management within a bank, it has to, you know, go through a revolution if not an evolution in order to meet the demands of the new market structure. And again, that brings a bigger part also on the custodians, which are being simply bookkeeping now, they are, you know, almost becoming front and center in helping and coordinating movement of the assets within all the parties. Any questions so far before I move on? Yes. Obviously today, you know, a lot of things are, well, most things are centralized. How much do you think decentralization will be valued in the future? If you can elaborate on valued means in the sense in what context? Like, do you think there will be like a complete 180 shifts to where a bunch of people, like a bunch of like the big banks and, you know, the entities you're talking about will go towards a decentralized model? I mean, obviously there's different levels of decentralization like Ethereum versus Savannah. So like, how much do you think decentralization will be a priority? Decentralization is a priority, but it's more of an evolution. And even if you look at the early birds in the capital markets, if you look at mostly our centralized parties like exchanges, ironically, they are trying to protect their territory and then they're trying to move forward and bringing in blockchain technologies so that, you know, yes, there are some efficiencies to be had, but it is not a truly a peer-to-peer market segment where we are, what we are seeing today. However, that's model is changing. Now we are seeing more and more networks, peer-to-peer networks appearing side by side. Now, how long will it take? This may take 10, 15 years before we can slowly transition away from what we are having today to the newer market structure. Again, this by itself is not 100% digital marketplace where everything is decentralized, not really. But if you look at it, the exchanges are pretty much in control and also the regulation forces you today in most market segments to use a CSD, a centralized party to record your security holdings. The laws have changed, the regulators have to become more and more comfortable with this new market structure. As you could see the tension between, for example, what ACC treats in one month, another month, how they treat these tokens and how their viewpoint changes. So it's going to take a while for as a collective market structure to move, but it is moving in the direction. As I said, this is more of a five to 10-year effort and we're talking about multiple different asset classes. So it's going to be a slow trickle-by-trickle, these assets move in and then at some point you're going to see a tsunami of these assets moving en masse, including public equities could one day move into a blockchain based infrastructure. Thank you. So what's required and I'll start with the data standards and look at what we have today and what can be done to move towards a DeFi marketplace. Obviously, we all know about FIX and FPML and ISO standards for the past 15 years. We use these standards for interacting and as I said, automation exists today using FIX. So you can automate a lot of those on the execution side. FPML is used more on the derivative side. ISO 2022 on the payments. But if you look at these standards are all broad specifications and typically intermediary service providers that have given the names, they take it and then enhance it create their own version of it of the standard and that's the version that you end up the market participant connecting to it. So there is no uniform standard. It's mostly a multiple implementation of the same FIX and FPML ISO 2022 versions and that means that you are fragmenting that data standard. That's okay in a current model but when you're moving into peer to peer model, who sets the standard? How do we come up even with one uniform standard? These standards fall apart because they are more of a specification, not a truly a data standard. That's what we try to come up with and say if you want to bring into the enforceable smart contracts on a peer to peer basis, you really need a very precise data standard and also you need interoperability between networks. We are going to see lots of these blockchain networks emerging and we need a way for trades, contracts to move between these networks. Much like the way how we are seeing on the crypto market, a couple of years back, interoperability was just a vaporware or talk but today interoperability is happening on a large scale between these networks and in fact that's become a norm from a lot of these chains to interoperate very easily. You can move your assets into an all better in a wrap form or essentially you can move from one network to another network, much like the way how we do ADR tokens or your depository seed tokens in capital markets today. Common domain model, again we did some presentations before, does help a lot because it primarily looks at as a peer to peer standard. It means for a given product and given workload there is only one way to define the standard. If any two parties code or code to this common domain model, you'll end up with the same exact definition or exact same instructions and that's where the industry participants like ISDA or basically International Swaps and Derivatives Association initiated about three years back. I was part of the working group for the past three years defining the standard. Now it's been taken up by other parties as well including Securities Lending Association and for fixed income by International Capital Markets Association. So this is becoming pretty much a digital standard that could be used across networks for interoperability and also to enable you know represent very well very well defined contracts that can also on point stand in the legal grounds. This is one of the interesting things. These specifications you know are not kind of legally enforceable because they're all the messages that are being passed between these protocols are only temporary nature at that moment. Parties agree to that message but once it goes into their respective systems you know you're no longer in sync but a CDM by the definition of it which I'll get back to quickly and help solve some of these problems. Very high level it is I call it as a more of a logical blockchain. It essentially creates much similar to a payload and in a basic business process and inputs and outputs. Most important thing is that is it tracks or creates a lineage to the prior event. So by creating events and having linking these events to prior events you essentially create a logical blockchain. That means this CDM block or data representation or I call it logical blockchain can then be applied on any physical medium whether it could be a simple database to blockchains to ledgers or whatever you have it's to you know holes it's true integrity by time because these are all linked by hash much like the way blockchains you link a bunch of blocks through through hashes the CDM also creates hashes and those hashes linked with each other so if anyone tries to modify any one of the block or in this case when you want to the event the whole event chain gets disrupted and so that guarantees that on a peer-to-peer model these protocols can be used effectively and also given a particular business event and a particular product type any two parties that define that event will end up defining or coming up with the same exact definition in technical terms adjacent formats. So if you take a hash of those we will always end up arriving at the same hash. So with that you now are able to look at the life cycle and we can model the life cycle from an initial order or origination walking through the life cycle of you know various types of execution allocation, netting, settlement and interestingly now because of the CDM allows you to work kind of like a backward link to the previous chain essentially as the operations move from let's say front office to back office to settlement you're also creating lineages or linkages back to the original document that created this prior document and hence you essentially created a full-fledged audit trail on the blockchain or database wherever you store the CDM data formats. That's very critical because now we are having an independent source of representation of data and contracts and this can actually stand in you know even if you're under scrutiny in a legal setting. So let's look at the automation in terms of security cycle automation. We talk about primary market and origination, security definition, registration, subscription. Not much of automation happens here. Most of the automation we see today is on the exchanges in execution facilities but there's a lot of opportunity for us to automate in the primary market. So similarly if you look at the secondary market now you're bringing in DeFi and automated market makers and liquidity pools this by definition by you know incorporating their APIs you can then start creating more automation on the or a parallel automation to what are the existing centralized exchanges. On the post trade cycles again we could broadly looking at life cycle events going from allocation, netting, research, dividends. You know all these operations today happen mostly manual even within the same firm, multiple different desks, multiple different trading platforms. It's a very complex environment. A automation of bringing this life cycle into not only intradesk but also between intradesk between parties helps to reduce the cost structure. That means you're eliminating reconciliation. You are bringing more and more towards a real-time trade life cycle and even possible settlements which ranges from payment payment versus payment delivery versus payment and we generally we call it as token star or token star essentially two parties engaging in a series of trades throughout the day netting and then coming up with a net of tokens moving from one party to the other party and then another step tokens come moving from the other party back to the you know the original party but in two parties, party A and party B. So how this all can be automated using infrastructures and blockchains is where a lot of work has been done and you know hopefully we can kick off a demo to show how you know we can so from primary market to all the way to settlement how we can actually achieve and check money at 10 30. I'm going to wrap this thing off at a very high level if you look at this what we have today is all trading platforms but what we are trying to see is that by bridging between trading platforms and ledger services the earlier attempts today the earlier implementations like in equity swaps by Axoni to give an example other infrastructure implementation from ASX most of the work is done on kind of building a general purpose ledger services but mostly on a single blockchain but now the market has shifted focus to creating multiple blockchains you could see specialization like you know product providing a much more stronger workflow based automation dammel similarly gives you a dammel or even hyper ledger hyper ledger with quorum or base with the transaction managers provide you a workflow automation and you obviously have enterprise tokens and then you have you know public or private tokens so essentially you really have to build infrastructure not just going into the various blockchains and building contract services but also the platforms have to be aware of and they also have to interact with these workflows and so there's a lot of infrastructural change required on the platform side to make this thing happen and this is difficult because you're taking a legacy infrastructure it is very hard to change a legacy infrastructure to adapt to this new model and so what's slowly happening is that is newer asset classes or existing asset classes we are building side by side this infrastructure along with this legacy infrastructure so over time the newer types of platforms and infrastructure will overtake and replace that as I said this is more of a 5 to 10 year you know effort I'm going to skip this thing maybe if you have time we'll come back because of this much more complex things about settlement and settlement lifecycle this is a good example of earlier we put out a white paper Vipin and I had worked on this last year and we showed how we can bring in automation using data standards and blockchains essentially bringing I'm not going to go into details this paper is available and we also have a the presentation is also available on capital markets just to show that how this can be automated between parties not only between single central bank but also how we can bring in cross-border contracts and payments as well and a lot of effort has been going on in between the banks and BIS has been spearheading a lot of the effort between the banks and how do we bring in cross-border implementations so I'm going to go on to quickly on the demo side of things and see what we can do and how we have addressed and again this is a generic definition of a workflow it's not necessary to what what is it that you're less implemented but in general a lot of the vendors are you know engaged in this looking towards of these kind of workflows and implementation with blockchains so here I'm giving an example of a capital markets network where you know set of dealers investors custodians and then you know working with in this case we have given a quarter network but it could be as well be a damel based or hyper ledger based network as well the underlying infrastructure does not matter and we have the asset class ranging from you know cpdcs to bank issued coins stable coins and then you have cryptos so a whole bunch of networks or blockchains to interact with so what we have shown or we will try to demo today is how a dealer would go through the life cycle by initiating and sort of creating and registering a token or a security minting the tokens and bringing it to the marketplace and then investor interacting with the dealer using digital RFQ so you don't need any as you see you know all this through the process we are trying to show how pure to pure model of work without any intermediaries it does not mean intermediaries cannot exist as I said centralized exchanges are there to play but here's an example of how we can bring in completely a peer-to-peer infrastructure between parties so again an investor engaging with the dealer to do an execution through an RFQ or an order or subscription whatever the form is and then the dealer then you know negotiating and executing the trade between the buy side essentially between the buy side and sell side the trade gets executed and throughout the day any number of these trades can then be netted between these two parties and then the netted transaction is not only being propagated back to their own corresponding custodians the custodian are a back office desk for the dealer and this custodian representing the investors so not only they get the kind of like a carbon copy of the trade in automatically into the system we also you know enable the regulator to see the exact trade and this is where CDM helps a lot because you are now a trade that has formed originally between two parties gets propagated to all the different desks and they all have a real-time view of the trade and also as we net the trade the netting the netted trade positions are also being exchanged or being distributed to these entities so reality means that means that none of them are double keying or entering the data twice the data capture gets once and shared between these two between all the necessary parties and you can see it's all peer-to-peer and privacy oriented only the relevant parties are involved in the transaction much different than what we see are in a public blockchain where every transaction is propagated all the nodes in carbon markets you really want privacy preserved and that's what workflow-based never preserves this now moving on to the actual settlement involves the custodians engaging taking those trades which are representing the dealers and their investors and exchanging what we call as settlement instruction between these two parties necessarily which is the settlement instruction in blockchain wall or it's exchanging wallet addresses securely of course and then each party going ahead and then committing or transferring the tokens here's where a newer block change like polymesh which allows you to provide which enables settlement finality whereby two parties when they execute both parties have to confirm to the trade and only then that trade gets finalized as opposed to cryptos where you unilaterally transfer then it's up to the other party if you send it or you know you pray and you transfer you get the right address you're good if not you lost the asset so that those problems are solved by the third generation of blockchains like polymesh which brings in settlement finality so I'm going to you know finally the the the executed transaction the settlement instruction is then propagated back to the investor so everyone is in sync by the end of the session whatever the session maybe it could be you know t plus five minutes it could be t plus eight hours is whatever the parties decide to sell I'm going to skip to the demo and we'll come back you know more if you want if you have time to look at some of the details of settlement so what I have brought here here is a dealer running a platform in this case we have implemented structure products private equity debt for the demo purposes we are bringing in a bringing in a structured product which is much very similar to a bond whereas the coupon is tied to the performance of the underlying which is primarily just primarily an equity index so the lifecycle of a structured product is very similar to a bond you create a security you create you know create a subscription whereby you know solicit subscription from the buy side the right hand side I represent a customer this could be any number of buy side clients and then you know you go through the process of registering the security setting up the prices issuing means minting the tokens based upon the subscriptions and then distributing the tokens to the parties and then settling the tokens and then you go through the remaining part of the lifecycle which involves at the end of the term how do you do the final fixing and then the redemption of the of the token themselves very very similar characteristic to bond as I said the only difference is the coupon is linked to the performance of an underlying the underlying today is equities but capital markets are looking at saying how do I tie up to a crypto performance so someday pretty soon you're going to see a structure product on Ethereum or you know Bitcoin or whatever underlying it's not only this I'm also going to show you the second screen where this represents the custodian for the sell side the cost of custodian two and the custodian for the buy side so now let's see how all of them can collaborate and engage in a trade and settle so I'm going to start with very quickly adding a new security we just as I just very similar to a bond I'm going to simply call you know for lack of time I'm going to just type in some jumble XYZ wouldn't give the name XYZ note I'm going to leave out some paying it is it's not it's not relevant here these elements references obviously XYZ is the underlying symbol setting up the nominal or the notion or the size of the size of an individual token size interest rate typically this agreed upon I'm going to put a six percent interest rate the barrier is an interesting concept in an instruction note where the buy side or the investor is given all the upside potential and the barrier is the downside or essentially a put option at that level the dealer would then up to that level that you know the buy side is protected and if anything below that barrier level then the buy side takes the risk so it's essentially if you put an 80 percent barrier level that means that if the price is at $100 if it drops up to $90 still at the end of the damn the buy side gets the full investment but if it drops below $80 then they start taking in hits to their notional or their principal but from a large perspective you can make these things you know very similar to your bond the location I'm going to skip all these dates and issue size I'm you know whatever a thousand and issue percentage is all simple terms I'm going to leave out the currency is the same you know single it's a bullet swap and you know defining all the Q zips and all the details so by adding a security at this point what's happened is this as a dealer is his intention is now to create the security distribute to their clients and then solicit subscription and then you know offer them the bonds for whatever the term period is since I think it's a one year or two year bond to do that the dealer would now go and say hit subscribe the subscribe would essentially saying do you want to send this thing to all of your customers for subscription so at this point when we hit the subscribe what is done is that is using the quarter network as a workflow it just transmitted the security definition and all the details to the buy side so the buy side can see the details of that here in this case not only that we are also going to see the same information passed on to the custodians so the custodians are also in sync with that security definition so you know single entry point of the whole network shares the infrastructure coming back to again to the buy side the buy side clicks on now they say oh I'm interested in subscribing to this clicks on a subscription as for how much is the quantity let's say 500 500 to make it simple adding the subscription kicks off to their subscription list as well as the dealer gets a subscription now this is only an interaction between the buy side and the sell side the custodians are not in mall so if you really look at on the custodian side there is this the subscription information is not there for XYZ this is the prior trade I did nothing on XYZ but on the dealers and the customers you'd see that subscription is available now the dealer obviously is going to get subscription from all of their customers when the time comes in to issue the security they would then actually mean to now go through the process of registering and minting which is nothing more than selecting that security and then registering which means essentially at this point it goes into the blockchain so here we use Polymesh as a blockchain and it goes and registers and creates the record with all the characteristics of these underlying instrument followed by either day of the issuance you really know you know like any other bond this needs a reference price and needs to fixing and that's where the fixing comes in so at this point the fixing price is zero so and so you know none of them are seeing the price so I'm going to set this price today today being the let's assume raise the issue date creating an issue price and pick a number 75 and set the price and you set the price now you can see that the price is not only updated on the dealer side it's also distributed to the buy side and to the custodians so again underlying the process of sharing data on network and workflows and processes so at this point we have the information we have said this we have set the price it's a matter of now we're issuing the tokens so again and go back and actually the issuance process essentially minting these tokens since we know in this case we have there's only one subscription 500 500 we really have to only mint 500 tokens and that's what it says issue 500 tokens in network and you say yes so at this point in the poly mesh in the blockchain we go and actually create an issue that mint the tokens now you're ready for distribution so you go ahead and then the dealer goes and kicks off the distribution so when the distribution comes in you can see that this is where cdm comes into the picture the trade is actually propagated as a cdm underlying cdm data structure to all the different entities and the trade is now confirmed or essentially allocated in this case we mean by distributed is essentially they're allocated of their security holding but not settled yet this is primarily the dealer I said here is allocation now we are going to get into settlement and you could see go on to the custodian side they see the allocations as well now the custodians can then actually start engaging in the process of settling the trade which is going ahead and then processing the settling I will stop that because settlement takes a while to go through the whole lifecycle of settlement for lack of time I'm going to stop at this point and ask questions I mean I'm taking questions but you could see the overall theme is you know touchpoint is only one touchpoint everybody else shares using data standards using blockchain you can you can get the entire workflow from all the way from origination to settlement so I'll stop at this point and you know we can take questions and you know explore more don't hesitate guys ask questions please for those who are not familiar with the capital markets I guess this is a rather daunting demo and all created by money which you know basically it is a capital markets in a nutshell I mean it is it has all the activities represented which may be very not familiar with for most people yeah anyway it is more daunting but you know but the idea is the same you know you're originating you're distributing and you're settling what is similar to how you deal with crypto today yeah but it's entire life cycle right so any anybody has questions Connor where are you seeing like the most interest from people like for the products that you're creating I mean the interest is there in all the different banks where we are we are we are engaged in you know a few banks at this point the challenge is always being KYCAML that's the main sticky point in a lot of the blockchain implementations today and that's the reason why banks are hesitant to adopt even cryptos because you know you don't know who the other party is when you're engaging in you know any kind of crypto transaction which is against the regulators and the regulators will not allow such trades in in a highly regulated environment where banks operate so where there is real we you know take up is more on as you say the bonds and structure products and capital market projects where there are a lot of interest green bonds you know these are all newer asset classes that's where you really take off will be good including cryptos so one of the things that we are actually exploring and bringing is treat cryptos as a security token it's a very different concept but it's nothing more than like how cryptos move as wrapped cryptos or a wrapped ethereum or wrapped bitcoin moving from one network to another network so what we are saying is that is if we can move or interoperate with these crypto networks and move them as regulated cryptos on to these block regulated blockchains or compliant blockchains like polymesh that's much easier for the banks to operate on because you know now who the counter parties are these blockchains have identified you know what's called a decentralized identities so that's where the real take up is capital markets is going to take off a lot of these ideas once we solve identity and KYC AML is much more easier for them to handle once you have the basic concepts of identity incorporated into the core blockchain itself which is happening now I think Sandy is asking about event handling in post execution corporate actions basically so corporate action yes that's a good question corporate action essentially involves it needs another layer as a transfer agent but from a pure workflow perspective CDM addresses that whereby in this case let's say a transfer agent acting on behalf of a an issuer can based upon the issuer's direction a transfer agent can create a workflow for dividends and that can be notified much similar way by how we talk about distribution of assets we can do to distribute interest or essentially notifying parties that as an interest is coming to you and then subsequently settling that interest by actually doing a transfer of the underlying interest and whatever the currency could be it's a CVDC or it could be stablecoins or whatever the underlying asset is money thank you thank you for that if I may just extend that like what about the events from the corporate actions a lot of times you know people have to make elections for the corporate actions how do you incorporate elections coming out of corporate actions here yeah these are all concerned I mean we have not you know addressed corporate actions per se yet that comes to the whole under a under the transfer agency there's a separate initiative going on even in the market participants of how to bring in because these are highly regulated entities as well it's not just technology is a much easier task to solve but more the regulatory challenge is to be resolved but yeah it is a complex problem that's why you really are not jumping into the earlier asset classes you're doing are much more simpler saying dividends or in this case interest coupons and payments or private equity you know I'm not dealing with complex different structures and as these products get matured and also gets approved by regulators then it's a lot easier to address public you know corporate actions the technology if I may if I may just ask one more question on top of that money so you mentioned multi-chain earlier right so now this example was using polymesh and and you also I think in one place you were showing the I think the issuance was happening using quota so I'm assuming your example here is already addressing multi-chain so so the assumption is that you can plug in multiple chains yeah we are living in a multiple chain world today you know we connect with like for example for stablecoins yeah we use circle circle circle is a separate api and it can be available on any number of chains as you know same thing with all the different vendors from the stablecoins like PaxSauce and Gemini they're also making these things available on multiple chains so you know we today we already are connected to like three or four different chains and this is only going to go into probably a dozen chains by the time in couple of years where you're talking about everything from market data reference data accounting legal so any capital markets project will have to deal with multiple chains on day one thank you thank you and I'm assuming you as a part of that you already have the different molecules or different external entities like whether that's compliance you can't test on that all day kind of coming as a part of that right so that's where a lot of things are just by the blockchain system for example polymers comes up with a lot of compliance features um yeah the decentralized identity um if you're going to issue a token and you want to restrict the token those restrictions are on chain so you can say for example it's a private equity and the equity is restricted to any other transfer can happen so that the chain would enforce we have workflows on quarter which governs a much higher level contract definitions like for example issuance of dividends are you know even defining a more complex instrument derivatives instruments we have done a lot of work on that with the with the dealers on interest rate swaps and credit default swaps before so which involves much much more complex life cycle events but they you know they as you said in terms of adoption you have to start from ground ground zero which is take up the basic assets stable coins work your way through bring in lending bring in then derivatives so it's a long process a long process shortened by your uh your platform um well it's not just us the others but yes our aim is to simplify make it available um so that the biggest the biggest operation cost what they are estimating you know we talk about the 600 billion dollars a platform like this can share about up to 50 percent of their operation costs because you're talking about throwing away redundancies and intermediaries reconciliation processes each one having to build a you know tens of millions of dollars in technology infrastructure operation staff there's a lot of cost can be squeezed out and you know could be redeployed elsewhere more productively from the bank's perspective yeah um so going back to that slide which was where the expenses and and the various silos or um you know where you showed yeah but if you notice here the huge profit makers are the hedge funds the private markets right and the wealth managers private banks and brokers I mean they have the they are making the most so how open do you think they would be to uh this uh quasing this cost because wouldn't that expose them to also getting sort of this intermediate a little bit well it's a profit is a profit right that's that's different from the cost the most of the cost structures are borne by the sales side the other ones investing heavily on technologies obviously you can look at the pockets of hedge funds obviously they're going to be they are involved in a lot of this automation and execution solutions themselves but for their own purposes but if you look at you know common cost infrastructure costs are all borne by the big banks and when we talk about banks it's a border front office custodians you look at all the intermediaries that's where the biggest chunk of you know cost is spent that's why banks are not able to get you know much out of it and the return is very meager compared to all of the last class so it's the banks to gain when they squeeze out the cost here yeah um but there's another push coming from regulators which has to do with something like archegos or other kind of systemic risk which is hidden right now in these private markets so there's no correlation between the private markets and the public markets and what happens when you know huge hedge fund or private investor takes positions not just in public markets but also in a combination of public and private markets yeah then the regular yeah no no your point is right and that's part of the reason is to say there is interest there's definitely an interest because compared to public equity private equity infrastructure is very you know very under under under developed and that's one of the key key areas where they are looking at saying how do we bring blockchain that means automatically brings transparency and when we talk about regulators so all these traits the regulators can demand you know drop copies of the trades as and when this private equity transaction happens so they can much like the way they can monitor public equity as as much as they can they could do should be able to use the same tools for private equity today it doesn't exist because it's largely you know hidden behind it's all mostly paper and you know not much of technology spent but blockchains you know bring that sheds a lot of light on all those processes as well but as you know there's contagion contagion is the biggest problem because whatever happens in the private market doesn't remain there because they are hedging or trading other securities that are in the public and that same thing happens with with even with stablecoin but for that matter USDT for example says they have 30 or 40 billion dollars worth of corporate bonds so you know they cannot do it right now very easily to expose all this stuff so will they bring in more scrutiny you do have that regulator view in your solution right right it's every every part of the trade you know when the trade gets executed we have a drop copy goes into a regulator node and that's a CDM CDM definition of the trade itself so which means the regulars don't have to worry about you look at today's marketplace where they have for the for the for the derivatives market they are instituted they want to have a drop copy of the trades or what's called as a trade repositories but there are like so many different variations of implementations they never defined a specification for it before that's coming to bite them hard because even if they have access to those records these are different formats but with CDM and data standard you can only have one single format to look at and you know but at the end of the day you know having access to the data is only one part of the problem what are you going to do with it that's it yeah so so you need some kind of automatic automatic aggregations to look at exposures to look at other things because humans cannot do this humans there is no way human right this is something that's you know there are a lot of tools available today in terms of aggregation and looking at risk exposures is the question really is how much of the regulator is willing to spend on bringing those tools in house to do the analysis well I mean the thing is some of the market participants will have to pay for this because obviously if they are engaging in high-risk activities they are also getting high rewards and to take money that is a profit and keep it private and then when the shit hits the fan as they say to to go to the public you know authorities with and say oh you got to back us up now we've got to bail us out you got to you know whatever so that when the technology cannot solve this problem this is this is you know no no no what I'm talking about is the cost so the cost has to be borne by the participants who expect bailouts or expect you know other forms of compensation you know FDIC works very well right after all for small amounts 150k well that's that's that's open-ended for every investor so technically that's a huge amount of money is they could do that they could do the same thing to capital markets well but the question is well I think you should read Sol Omarova's paper on public ledgers which which talks about it and says you know we have to make all of these credit generation itself public public you know public in the sense of governments you know taking over because today the government is printing eight trillion dollars where is it going into the capital markets they're buying securities assets that probably would have cratered in value during the pandemic you know mortgages would have gone down like you know like a sinking ship like the Titanic down into the depths of the icy cold waters so all of this is being held up by public money so there is a huge outcry against this and you know as as technologies we can only admission saying bringing equality or you know bringing fairness and transparency to the marketplace but it's still the end of the day it's the market participants you know have the power to adopt or not to adopt or circumvent or you know well not if there's regulation saying you cannot and you know you have to do whatever is needed to keep the financial system intact um anyway so I think we have passed the hour and it's been a fantastic presentation very comprehensive and it has also Andy's bicycle and last question maybe where is the the question I just saw I mean this raise their hand no no that was a clap that was a plus for you money a plus a plus yeah so I think nowhere else will you see not only the comprehensive reworking of the capital markets but actually a demo that shows how it can be done this is not just talk that's that is a beauty of money's presentation so hopefully we can make this presentation available to others and probably even talk about specific aspects of it we are working in the capital markets working group to create a NFT like structure so that you know it would then feed into the let's say into the securitization process and how you know it is even a pre-issue and sort of thing how do you assemble these NFTs into a group much like mortgages and then securitize them so it even goes you know before the issuance so these are all interesting topics and we are going to have a lab probably for this for NFTs and then we hope to integrate that with this whole security issuance and settlement and custody and then obviously the payment side which as you well notice can be cryptocurrencies can be stablecoins can be CBDCs any form of payment well in a generic sense d-star versus d-star so thank you and we'll revisit I think now one of the things that we have to say is that if you want if you think these presentations are important please participate please make suggestions and please come up with other interesting presentations maybe even you know next year money can talk about some specific segment of this of course putting it in the context of the entire into the system of capital markets but thank you all and hopefully we'll have another maybe not because by the time we come around to the next one it may be already Christmas season but I think December 15th we are planning to have a deep dive of AMMs which I am hoping to present with the whatever whatever I can get together before then so hopefully you will attend thank you and thanks. Thanks Vivian. Thanks.