Banks Stress Speed in Adapting to Shifts in Financial Infrastructure, but Accountability Remains Unclear
TECHWORLD ·
✦ AI Summary
Kim Jun-hwan, an executive at Shinhan Financial Group, said the basic functions of finance remain intact, but the infrastructure that implements them is changing.
He stressed that banks could lose their standing if they fail to secure a lead in infrastructure and standardization, and that they need to continue building trust and taking responsibility in the new financial infrastructure.
However, he said it is difficult to clearly define who would be responsible and to what extent if an actual incident occurs because stablecoin legalization, consortium formation and the share of financial companies' participation remain undecided.
As financial infrastructure changes rapidly, banks are emphasizing the importance of their role in ensuring trust even in a transformed financial environment. However, when an actual incident occurs, the party responsible and the scope of that responsibility remain unclear. This article focuses on changes in the infrastructure and standards underpinning finance rather than on finance's functions themselves.
Kim Jun-hwan, an executive at Shinhan Financial Group, attended the Korea Investors Service (KIS) -hosted "Digital Finance Conference" on the 21st and explained the situation facing banks amid changes in financial infrastructure structures. He said the basic functions of finance remain intact, but the infrastructure that implements those functions is changing. He also explained that as various players take part in building the financial infrastructure and standards that banks had previously led, banks' roles are also changing along with those infrastructure shifts.
Kim Jun-hwan said banks need to change, warning that they could lose their standing if they fail to secure a lead in infrastructure and standardization. He stressed that banks must continue to play a role in building trust and taking responsibility in the new financial infrastructure as well. He added that it is important not simply to issue new tokens, but to implement the full process of payments, settlement, custody and distribution and connect it to existing finance, and said banks need to secure a role in that process.
The speaker said that, with the outlook for blockchain-based finance, the object of trust will change. He explained that the focus will shift from trust in counterparties such as financial companies to trust in technology and infrastructure, including smart contracts.
However, the speaker said it is difficult to clearly define who would be responsible and to what extent in the event of an actual incident. He cited the incomplete legalization of stablecoins, the undecided future composition of any consortium, and the lack of a finalized business structure, including the share of financial companies' participation, as reasons.
He added that because his company's share in the consortium is uncertain, it is difficult to specify who would be responsible. Still, he said he is committed to continuing to play a responsible role in blockchain in the future.
Source: TECHWORLD · Kim Hye-jin
Original: https://www.epnc.co.kr/news/articleView.html?idxno=407222
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Source: TECHWORLD
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