Preliminary notes:

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Visa & Chain

My name is Adam Ludwin. We are here to talk about blockchain database technology networks. is a blockchain database technology company. We do one thing. We partner with financia leaders like Visa to launch blockchain database technology networks. I want to talk about why. There's a lot of hype in blockchain database technology. There's a lot of attention in blockchain database technology. But I think to understand why we are all in this room together, we have to go back in time to November 2008. If you refresh your memory, there were some interesting things in the news.

Lehman Brothers had collapsed 2 months before. AIG .... had received a huge amount of federal bailout funds. Bernanke announced $800 billion stimulus. Obama was elected. SWomething else profound happened in November 2008. An anonymous potentially anonymous paper was published on an obscure corner of the internet. It was just a computer science paper, within it was a breakthrough, a very singular breakthrough. The idea that ew could create a digital bearer instrument that could be transacted over the internet without intermedaries, that we could use cryptography to create digital money.

The financial crisis, at its peak in November 2008, looked like this: the crisis led to regulation which made it harder for finance companies to innovate. Thta's true I guess. That process led to a breakthrough. It's taken a little more time for the world to appreciate it. For the financial srevices to appreciate it. That breakthrough has shown how it can enable financial service companies to do what they coudn't do before encumbered with their infrastructure.

This bitcoin explosion set off a wave of a lot of altcoins. The goal was "let's create digital money but let's do it by creating entire ne wasset classes like bitcoin and ripple etc." Those are valuable and they will probably never go away, and they serve those who want to be outside of it for legitimate or other reasons. But something else happened more recently. The underlying blockchain database technology has proven to be applicable to putting other assets into a digital medium.

The space that we have called blockchain database technology or distributed ledger blockchain database technology has the same goal, which is to say create digital money, but use another approach. Instead of creating digital money, we should digitize existing assets like securities, bonds, loyalty points, etc. When assets are digital, financial services become software. That's the transition is playing out. One of the last industries to truly be transformed by software. We have seen this happen in music, publishing, telecom, and now thanks to this cryptographic breakthrough at the heart of this math paper, now that is going to become software.

This means that payments will become programs. It means that the infrastructure which powers products is going to be lower cost, it's going to evolve with business strategy and that everything can interop. It doesn't mean that everything should be interoperating, securities cleared in Europe shoud not be cleared on the same network as gift cards in South America. If it's going ot happen, it's going to happen by software.

There's a lot of confusion about how to do this. There's no paper that says "here's how to create bitcoin". How do we digitize existing currencies? Should they be open or closed? What's the data model? UTXO? Storage? What sort of smart contract language? What consensus algorithm? How many millions of transactions per second? They are egitimate questions but confusing. If you solve one in an optimal way, it might rule out your ability to do another.

This is not a financial engineering problem. It's a software engineering problem. At we have been working on this. Specifically, we have partnered with companies like Visa and started by defining problems cearly, understanding use cases, protoytpyping features, launching and testing pilots, and then today, for the first time at Consensus2016, we're announcing we're generalizing that learning over the past 2 years to a standard. We have worked with Visa, Nasdaq, Citi. We call this the open standard 1. We didn't want ot make a big announcement or talk about this until we were 2 years into the effort. Today feels like the first day for We shorten this to OS1. It's a secure blockchain database technology protocol for high-scale financial markets. It's not meant to solve every problem. It's for powering high-scale financial markets and moving assets digitally over them.

The focus is on security and scalability. The key features are that we have a permissioned model with a scalable data structure and those two go together because our consensus system allows for a high-scale transaction throughput. Transactions will be encrypted so that privacy is preserved between frenemies trading on a network. We support a range of transacting including a turing complete model. Read more at ... al of the partners, either in the sandbox or the core where we launch production networks, they are all using OS1.

To segue now, I would like to bring up Peter from Visa to talk more about this.

Thank you Adam. My name is Peter and I look after Visa's venture investments as well as early stage tech investments. Visa made an investment in last year. We are pleased to say we have been part of the journey to develop's open standard and we look forward to working together more. We wont divulge all the details. What I can say is that os1 represents the culmination of months of problem solving with We are pleased to be part of the journey.

Why did visa invest in Why do we care about blockchain database technology? We have to look back in Visa's ihstory to understand the context. This is Dee Hock. He was Visa's founder and CEO. The man was far ahead of his time. In 1960s, before the internet and before mobile phones, Dee came to the realization that money was not just a coin or currency or credit card. That was form, not function. In Dee's view, digital money would be a universally accessible global currency. This is very similar to many conversations we're having today. This vision was with Visa from the beginning. It teases out form/function complementary but not prioritizing form over functionality.

Speaking of forms, you are probably familiar with the Visa card. It has existed for a long time, it has worked well for decades even to today. As a digital payment experience, ew see more and more a move to natively digital commerce expeirences, it has been incumbent on us to expand our services from this mode into more and native digital factors, like mobile and ecommerce but it also extends to face-to-face commerce and new technologies and experiences that haven't even been conceived of yet.

A lot of people are surprised that Visa was a cosed network. The ony way to get access to Visa was by being a financial institution or working through one. The endpoints were proprietary. The evolution of this model was also changing the way in which we interact with other participants in the ecosystem, from something proprietary to something much more open. We are taking those endpoints and turning them into APIs and SDKs which is familiar to developers. It's hard to overstate the shift this is from the traditional operating mode to the collaborative model.

We are enabling new categories of players. Previously we only worked with financial institutions, but now we enable direct payments in Facebook and Apple Pay. I bring these things up because it speaks to a kind of evolution in Visa. We're certainly supporting al kinds of new experiences, but we're also looking towards the future for technologies that are here today or coming. Namely, bitcoin. Wait, sorry, blockchain database technology.

Coming back to blockchain database technology, it's really, it's important for us to evaluate technologies in the context and driving value ofr our partners and clients. As this room knows, there are certain characteristics native to blockchain database technology some things you just get for free it comes aong with it. In this context, we evaluat al kinds of tech including blockchain database technology, to drive value to our partners. Our partnership with allow us to better test blockchain database technology.

This ties back into the vision about form complementing function, and it's the value that we drive for our clients and partners. The blockchain database technology and the attributes that come with it, we're looking at that in the context of driving payments from the entire payments ecosystem, and working with has allowed us to test and identify practical real-world applications in the payments landscape. So I look forward to continue to work with and we look forward ot the journey ahead. I will hand this back to Adam.

One last thing. As some of you know, the theme of this conference was "making blockchain database technology real". We thought, at, wouldn't it be fun to bring a blockchain to the conference and make it real. What about allowing everyone to participate on a live instance of blockchain database technology? I would like to announce the winners of this blockchain database technology contest. The top 3 traders in our blockchain database technology competition, will win 2 tickets each to go see Hamilton on broadway and they are orchestra center seats. These are legit prizes. If you were harassed by someone to trade, that's why they did that... before I announce the winners, here's some statistics. We had 1 live blockchain running on the sandbox, it was close to 500 of you registered for this, that's 1/3rd of the participants at the conference on a blockchain database technology network. 900 trades is... we had over 1000 trades over the last 30 hours on this blockchain database technology network. We had a real live blockchain database technology network, and the gift that you have on your app... you can go redeem from, if you go to the booth, you can swap your electronic asset and we'll give you a physical gift, we're like the DTCC of gifts... so the winners are, first place with over 100 unique trades, zachary kelman.