GRC3.0
Dr. Caesar J's Digital Management periodicals?
The eleventh in the series of summary outlines
July 2023?
GRC3.0?
My eleventh article on deep tech matching will follow a different approach from the one used in my previous sixth article[1]?DeFi Risk. This time, I am matching GRC with Web3 to explain and justify the GRC3.0 title I used. Knowing that #defi and #web3 are very close, there is still creativity to avoid a repetition. I chose to quote?@Timothy mark-Ugwumba?after his June article of similar subject. Regtech remains a sizeable opportunity when matching #web3.0 with #grc. The other opportunities could lie in the hardware and, from a macroeconomic standpoint: the opportunity of cash economy avoidance.
RegTech
It is no more a surprise to find a compliance business opportunity in a deregulated financial vertical. The opportunity is like selling a remedy, like the sad example case of the Covid vaccine analogy. I will choose less sad examples to develop the idea further, like the obligation to have a real human compliance manager person instead of simply a tool.
FinTech and Web3 are attracted by RegTech friendly legislation territories, such as Zug, Lugano, or Tallinn. Up to a point where there is a shortage of resident compliance officers or a #RegTech limit. One should be filling for the other. The European Central bank had limited Estonian compliance officers to ten crypto partnerships and imposed an external auditor. The business opportunity is therefore enforced.
Up till recently Web3 was a no go for RegTech. Not anymore. The same RegTech solutions and services are being adjusted to be delivered for crypto and traditional fiat FinTech. Just as compliance needs humans, the humans when overwhelmed require digital support. This digital opportunity is now available.
I am planning a focused Article on the digital business opportunity of using #AI for RegTech, most probably in November under Article No. 15. This will be an added digital business opportunity under RegTech, Web3 and other #deeptechs. Business opportunities in AI are abundant.
Hardware
Another resurging digital business opportunity is in assets, hardware, and the tangible space. On one side the dematerialized NFT art will need a tangible hardware support for display and for security and protection. The paradox of a purely crypto concept requiring a tangible asset to uphold its value and secure it. The more the displaying opportunities the more the trading opportunities.
The money invested in #NFT opens the door for the business opportunity of protecting the value of the investment and mitigating the security risk of the asset disappearing. Even if NFT is no more the hype, the risk part of the GRC will have a role to protect the investment.?
When we say assets, it is both the crypto tokens on one side of the barbell (borrowing the term from Taleb’s Antifragile) and tangible ones on the other. For GRC purposes, tangible hardware assets are required, among other solutions, to protect the token code in off-line mode.
The other hardware opportunity is the physical display of the NFT. The displaying asset should be submitted to compliance rules, especially to protect the buyer of the NFT. The business opportunity is the certification of the NFT display. This involves copyright extraction from the underlying blockchain, to say the least. The NFT is certified by the blockchain time stamp, but the displaying asset need to be certified.
Cash Economy
The third selected digital business opportunity in this article, is at macro level, macro GRC. You will need to consider central bank governors’, finance ministers, public stakeholders, and financial regulators as your customers. The customer will be the #macroGRC practician and the Web3 the solution provider target.
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Some countries require monetary policy help and support for various reasons, weaknesses and threats, their macro GRC calls for Web3 support. When a national currency gets abysmally devalued, among the proposed solutions, temporary or permanent could be a CBDC (Central Bank Digital Currency) to avoid falling deep into a cash economy or entrenched in a foreign currency dependency economy mode. Note that the #cbdc is one of the possible options not necessary the only one among all the crypto currencies options.[2]
Is Crypto better than a national currency? In the strict sense of a digital business approach, that means is there a digital business opportunity for both the national Monetary Policy stakeholders and the solution provider? The answer is yes. If crypto can help it would be thanks to the Web3 technology, learning curve, and expertise.[3]
Macro GRC regulating is a potential customer of Web3 whether in dire devaluation circumstances or because of market digital maturity.[4]?When crypto finds its way to the G20 main agenda, this means that public sector GRC for Web3 is going to happen. The Web3 hype has appeased, and central bank governors are coming to recognize the benefits of crypto. Web3 is not a taboo anymore.?
With this eleventh article of the digital business series, GRC and Web3 combination we benefited from a six-month span between the #defi and GRC matching article and now. The highlighting incentive came from the acute national devaluations still taking place with no apparent solution and, at the same time, the India G20 summit and how crypto is all over its place. In addition to the RegTech and hardware digital business opportunities, the reader would have found it worth her while. The next article topic will be about matching Design Thinking with Embedded Finance, August 2023.
Dr. Caesar J.
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[2]?https://www.reuters.com/world/india/india-finance-minister-us-treasurys-yellen-discuss-debt-crypto-2023-02-23/
[3]?https://www.coindesk.com/policy/2022/04/07/treasury-secretary-janet-yellen-calls-crypto-transformative-in-wide-ranging-speech/