Blockchain making inroads in finance say executives in earnings calls (NASDAQ:WETF)
Blockchain technologies provide financial companies and their customers with speed, efficiency, 24/7 execution and cost savings, several financial companies pointed out in their fourth quarter results calls.
WisdomTree Investments (NASDAQ: WETF) Founder and CEO Jonathan Steinberg sees blockchain technology becoming ubiquitous in payments and financial services. “It is the convergence of blockchain technology with universal smartphone ownership and tokenization with smart contracts that will effectively blur the lines between savings, payments and investing, fundamentally changing the way consumers perceive and interact. with their own money and assets,” he said during the company’s Jan. 28 earnings call.
Specifically, the company’s WisdomTree Prime, its upcoming blockchain-native digital wallet, “will bring the look and feel users are accustomed to from traditional mobile apps, while delivering the benefits of the financial services experience. based on DeFi principles,” said Steinberg. WisdomTree Prime will launch beta testing in select states in Q2 with a nationwide rollout by the end of the year, followed by an introduction in select global markets.
“As a forerunner in launching blockchain-enabled funds and tokens, we have the opportunity to lead the market in beta and alpha generation strategies, large addressable markets where we can generate excellent economies, scale rapidly and dramatically accelerate organic growth,” says Steinberg of WisdomTree. He expects to unlock new neo-banking-like revenue streams, such as payments, transactions and net interest income, by diversifying Wisdom Tree (WETF) revenue and accelerating growth organic.
“We are so confident that assets will transition to blockchain because the efficiencies and improvements are just too great to ignore,” Steinberg said.
National Bank Holding (NYSE: NBHC) The 2UniFi platform is intended to be the equivalent of the Amazon Marketplace for financial services for small and medium businesses with alternative digital access to a range of financial services. Part of that is access to blockchain payment tools.
Last month, the company’s NBH Bank unit minted a USDF stablecoin and sent it to a client of New York Community Bank, a subsidiary of New York Community Bancorp. (NYSE: NYCB)as a test to demonstrate bank-to-bank interoperability on the Provenance Blockchain, a public blockchain.
The transaction “not only demonstrates USDF’s banking interoperability, but also demonstrates banks’ ability to offer their customers new secure payment applications with low-cost, real-time settlement,” said Valerie Kramer, director. digital at NBH Bank (NBHC). “The USDF facilitates the compliant transfer of US dollar value on the blockchain, removing friction in the financial system and expanding digital access to financial opportunities.”
NBH Bank, Community Bank of New York (NYCB), First Bank (NYSE: FBK)Sterling National Bank, Synovus (NYSE: SNV) Bank, Figure Technologies and JAM FINTOP are the founding members of the USDF consortium.
FB Financial (FBK), also a member of the consortium, sees “almost limitless” use cases for the USDF stablecoin, “and in any case, it provides efficiency and an improved experience for both us and our customers” , Chairman and CEO Chris Holmes said during the company’s Jan. 18 earnings call.
Two areas that FB Financial (FBK) focuses on are the mortgage industry and its prefabricated house manufacturing business. “We know that manufacturing and delivering mortgages for sale can be done much less expensively using blockchain technology,” said Wade Peery, chief administrative officer of FB Financial (FBK). In payments and settlements, “we will be able to substantially reduce the costs of these systems and achieve 24/365 real-time settlement on the blockchain.”
Western Alliance Bancorporation (NYSE:WAL) also highlights the 24/7 benefits of blockchain systems. It started a partnership with Tassat Group in December to provide blockchain-based payments to customers using TassatPay’s platform. Scheduled to launch early in the second quarter, the program will allow Western Alliance Bank customers to transfer funds to each other 24 hours a day, 7 days a week, WAL President and CEO Ken Vecchione said during of the bank’s earnings call on January 28. This program is not yet factored into Western Alliance’s (WAL) forecast for deposit growth, but will be once it has an idea of how the launch is going, Vecchione said.
Intercontinental exchange (NYSE: ICE) President and CEO Jeff Sprecher focuses on the use of blockchain technology in the mortgage industry. “The main value is that it creates an indelible record. And so, to some extent, property rights are something that society considers an indelible record,” he said on the earnings call. of the company on February 3.
And from a brokerage perspective, blockchain and the broader cryptocurrency environment “has really been used as a marketing tool to move people from more analog brokerages to more digital brokerages and give customers direct access,” Sprecher said. “So brokerages that haven’t engaged their clients digitally are finding themselves somewhat disintermediated by new brokers who are digital.”
In Related Reading: SA Contributor John M. Mason Discusses the Future of Blockchain in Finance
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