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2017

John Schlesinger

Chief Enterprise Architect at Temenos

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John is Commenting on

Central bankers split on CBDC future

Good points Andrew. On replacing physical cash with digital cash, clearly it doesn't solve financial inclusion but it can make it worse if you require KYC, AML and a bank account.

17 May 2021 Reply Read article

Central bankers split on CBDC future

This is about widely available digital cash, it is not about wholesale and it is not about bank accounts. m-pesa in Africa, predominantly Kenya, is account based mobile money. The digital cash will only replace physical cash if it is anonymous and if it can be used offline with immediate finality. So forget blockchain based payments fo any large country, clearing cannot be on a blockchain, though minting and settlement could be. As this has to include the unbanked, forget KYC and AML. This means there will have to be caps on the size of payment and balances in wallets.

17 May 2021 Reply Read article

Existing digital currencies unlikely to last says BofE governor Bailey

It is not just volatility, it is also throughput. Bitcoin is set up for settlement but not for clearing. It seems that Satoshi Nakamoto got them confused...

26 Jan 2021 Reply Read article

As blockchain hype subsides, banks count the cost of early euphoria

I regard blockchain as being a denial of service attack on the innovation dollars of banks. There are two different technologies - distributed ledger and smart contracts. There are significant issues with both. DLT is a kind of database. It is insert only, immutable (hence cannot contain any PII because of GDPR), and is distributed but not partition tolerant (because it must always be available and strongly consistent). That means it is suited to settlement but not clearing. Its only enterprise use case is therefore management of ownership of assets. But this requires trusted parties for the consensus to be deterministic. So the hype around Bitcoin, which uses probabalistic consensus, is not transferable to reliable enterprise use cases. In any case, Bitcoin is really Bitgold - it is a store of value but far too slow to be used for transfer of value. Smart contracts require the enteprise to master immutable code in distributed multi-threaded applications. These are fiendishly difficult to get right. It is much harder than writing provably correct code for safety critical applications, like fly-by-wire airliners (think 737 Max 8). This is because the code has to be proved correct while multiple distributed services execute the code which is not the case for fly-by-wire. The software industry is not ready for this problem

19 Aug 2019 Reply Read article