A Commentary by Naum Ravinovitch, Co-Founder and CTO Smart Structuring™
I’m not a wealth structuring or wealth planning professional, I don’t do estate planning or advise high net worth families on legacy issues. I’m a Chief Technology Officer with experience in wealthtech/fintech and I am shaking my head.
I’ve been working in this space for a number of years and I have watched as technology has advanced many sectors at warp speed. Manufacturing and supply chains, hospitals and health and wellness, banking and financial services have all embraced innovation and technology is driving them forward at a rapid pace.
And at the center of much of this innovation is the #blockchain.
But before we dive in, a bit of background…
Many people wrongly believe that cryptocurrencies gave rise to the blockchain, but it is exactly the other way around. Blockchain is what allowed cryptocurrencies, CBDCs, Altcoins, smart contracts, etc., to simply exist.
Blockchain offers many advantages to users including decentralization (information is stored in a decentralized manner making it almost impossible to hack), security (the information is not retrievable unless you have the “key’ to do so), traceability, privacy, transparency, trust – you get the drift here.
"Many people wrongly believe that cryptocurrencies gave rise to the blockchain, but it is exactly the other way around."
My prediction is that it won’t be long before the banking sector fully embraces blockchain due to the enormous cost of cyber security breaches and on-going hacks that require multi-million dollar ransoms before systems are unlocked and functioning again. The hackers are always one step ahead – and they aren’t going away anytime soon. It’s estimated that cyber security issues will cost the financial services sector $6 trillion in 2021.
So, back to The Pandora Papers and why I am shaking my head.
Here’s a pivotal question for trust professionals; how many hacks is it going to take for the entire sector to get innovative and start to embrace blockchain technology?
"It’s estimated that cyber security issues will cost the financial services sector $6 trillion in 2021."
Clearly one was not enough, two came and went... and now, the sector is on its third round of data theft.
Is this preventable? In a nutshell, yes, it is.
Rik Willard, noted cryptocurrency and blockchain pioneer recently commented at an international trust and estate planning conference on new and unique product that is near and dear to my heart, Smart Trust™. A blockchain enabled trust management platform, Smart, he said, was the future of the sector and poised to disrupt a sector that desperately needs shaking up.
Trust management and the blockchain
Happy to chat further if you are interested!