Financial giant DTCC CEO seeks advice from Blythe Masters on blockchain

Baozou Comment : The emergence of blockchain technology can replace many existing financial intermediaries, thereby reducing costs and saving time. When DTCC reforms blockchain, it should seize the opportunity, follow the trend, and use blockchain technology to learn professional knowledge. If someone also wants to eliminate the trouble of middlemen, we should let them become one of us. After all, trading cooperation without intermediaries is the trend of the future Internet world.

Translation: Nicole

Yesterday at the DTCC’s all-day blockchain panel, CEO Michael Bodson asked Digital Asset Holdings CEO and former JPMorgan Chase managing director Blythe Masters what role the company should play in innovating blockchain technology.

Many entrepreneurs and academics are looking to the future, believing that emerging technologies will replace traditional financial intermediaries, especially those that facilitate capital market transactions.

When asked for advice, Masters was flattered but quickly pivoted to discussing the real threat DTCC faces from providers of low-cost blockchain-based clearing and settlement methods.

Master said:

“I would say, as has been said before, that ignoring or discounting the trade that other people are in is a very dangerous thing to do. You feel better if you ignore your competitors, and you feel better when you blame yourself, but the risk of ignoring opportunities is great.”

Masters went on to discuss how this feeling made it difficult for her to ignore the hype surrounding Bitcoin and begin to understand the true innovation of the blockchain’s underlying distributed ledger.

She continued:

"The reality is there's a lot going on on the surface, but it's important to focus on your competitive position, even if you're the only supplier."

DTCC CEO: Michael Bodson

The conversation revealed that when Bodson and Masters first discussed blockchain, Masters assured the CEO that the technology would not necessarily put DTCC out of business.

Masters still emphasizes that financial companies may fail in the blockchain transformation period, just as many media suppliers have been eliminated by the network reform.

Overall, Bodson’s comments were interesting and framed the conference as part of DTCC’s strategy to reform and understand how best to leverage expertise, even as specific solutions are still being developed.

At one critical moment, Bodson said:

"If someone wants to remove the intermediary and work with us, I will make him one of us instead of an outsider."

The fireside chat capped a day of discussions that included a diverse group of participants, from representatives from the White House to bitcoin and blockchain entrepreneurs.

DTCC will conduct the first blockchain technology trial with Digital Asset Holdings to use blockchain technology to expand repo trade.