In This Newsletter
FinTech in South Florida
Nicole Valentine returned to iConnections Global Alts in Miami Beach this month, where she moderated a session on megatrends influencing the crypto industry. Megatrends are broad arcs of change, patterns emerging in the macro environment, and powerful transformative forces that could change the world economy. After a tumultuous year and facing a new Congress, comprehensive legislation and regulation of the crypto sector are at the forefront of policymakers’ agendas. In this environment, it is important to understand the forces driving the development of a responsible crypto industry and what blockchain technology can offer.
In her panel, Valentine led panelists through a conversation on the emerging megatrends influencing the crypto economy: AI, US dollar dominance, tech giants, stablecoins, regulation by enforcement, DeFi, staking, and systemic risk.
Perianne Boring, executive director of the Chamber of Digital Commerce, discussed the policy and regulatory landscape in Washington, DC. The Chamber will host its annual DC Blockchain Summit on March 21. Chris Rhine, head of liquid activity strategies at Galaxy, spoke about how blockchain can enable greater efficiency and productivity in payments infrastructure.
Jalak Jobanputra, founder and CEO of Future Perfect Ventures, shared the trends influencing her global strategies for digital asset investments. She shared her perspectives on the Milken Institute stage this past November at the Middle East and Africa Summit session, The Next FinTech Unicorn: Investment Opportunities in FinTech. Lorien Gabel, founder of Figment, offered his views on how AI innovation is interacting with blockchain tech. He also discussed the potential role blockchain can play as financial infrastructure. The FinTech program convened a deep dive on blockchain as infrastructure at this year’s Public Finance Forum in the session Rethinking Blockchain: Building Sustainable Public Finfrastructure.
HBCU First Cohort Launch
This month, the Inclusive Capitalism Program (ICAP) launched its HBCU Strategic Initiative and Fellowship Program, welcoming its first cohort of 16 students with a reception in Washington, DC. The FinTech team is excited to actively collaborate with the ICAP team to curate financial technology curriculum for its fellows. The launch event followed the inaugural cohort’s first day of instruction. It featured remarks from Loida Lewis, widow of the late Reginald Lewis, Senior Director Blair Smith, Executive Vice President of MI Finance Michael Piwowar, and Chris White, lead instructor at ViableEdu.
Historically black colleges and universities (HBCUs) continue to be overlooked as a resource for quality talent in the investment industry, despite the decades-long history of producing global leaders in financial services. Yet greater diversity, equity, and inclusion (DEI) initiatives in the asset management space remain at the forefront of many issues facing the industry. DEI continues to be a pertinent focus of asset owners and managers—particularly the challenge of sourcing top diverse talent.
To help connect resources to talent and as a continued commitment to developing DEI across the business community, the Milken Institute recently introduced this HBCU Fellows Program for sophomore undergraduate students. The program offers a virtual curriculum to learn more about finance, along with professional development and in-person networking opportunities.
The program launch comes after the publication of the ICAP program’s Path to Inclusive Capitalism: An Asset Owner Guide for Investment Portfolios. The report, co-authored by Blair Smith, Bhakti Mirchandani, and Troy Duffie, serves as a guide for asset owners who are on the path to financial inclusion, consultants who advise them, and asset managers who seek to become part of their investment portfolios. Mirchandani distilled key points and recommendations from the report in a recent series of articles for Forbes.
Britcoin vs. Bitcoin: An Update on the Digital Pound
As the United Kingdom seeks to carve out a regulatory niche after Brexit by leveraging its strong financial sector, the Bank of England (BoE) is considering rolling out a British Central Bank Digital Currency (CBDC). This month, the UK Treasury released a white paper outlining its implementation strategies for the British CBDC, The Digital Pound: A New Form of Money for Households and Businesses?
While the report sets no official launch, the BoE is actively exploring the possibility of issuing a CBDC to keep pace with the changing demands of digital transactions and financial technology. The central bank has established a task force to study the various technical, legal, and economic aspects of launching the CBDC and to determine its feasibility and potential impact on the financial system.
The increasing popularity of cryptocurrencies and the rise of public and private digital currency companies have created pressure on central banks to consider issuing CBDCs. The Associated Press reports that the successful launch of CBDCs in several commonwealth states in the Caribbean and Nigeria has put pressure on the UK to take action in the race to viable CBDCs. Speaking at a session at the Milken Institute Public Finance Forum, Economic Secretary to the Treasury Andrew Griffith emphasized how the United Kingdom prioritizes building a transparent, safe, and reliable regulatory environment for digital assets.
The British CBDC is expected to provide a secure, fast, and efficient way to transfer funds and make payments, like cash but with the added benefits of digital technology. CBDCs are seen as a method of reducing the dependency on payment intermediaries and promoting financial inclusion, especially in areas with limited access to traditional banking services. The central bank will have to ensure that the security and privacy of transactions are maintained while providing for AML/KYC. The CBDC will also need to be resistant to cyberattacks and fraud.