Professional Documents
Culture Documents
22, 2016
(Cost Reduction)
Based on the high level of security, efficiency, and promptness
of settlement of distributed ledger technology, we expect to see
significant cost savings when applying financial services.
Distributed Ledger Technology Cost Reduction Factor
Division
IT System
Management
Aspect
Saving Factors
Reduce application
development costs
Lower infrastructure
procurement costs
Reduce the cost of developing
intermediate structures
Reduce auditing costs
Reduce paper document
management costs
Reduce labor costs
-1-
Korean
Exchange
Total cost
Pure IT costs
Welfare and labor
costs
SG&A expenses
Effect of cost
reduction
5,508
1,186
2,351
Korean
Securities
Depository
1,188
70
605
1,971
881
513
190
-2-
Structural Change
Distributed ledger technology could replace
existing infrastructures such as intermediary
banks and SWIFT (Ripple, etc.)
The issuance, registration, and trading of securities
becomes efficient and existing intermediaries role
will be diminished
Existing manual financial transaction procedures
are automated to increase the efficiency and
reduce the probability of accidents
Real-time reporting and auditing of transaction data
is possible, and cross-agency comparison and
integration is easy
Easily share customer identity information and
reduce regulatory compliance costs
Automated claims and payments and reduced
insurance fraud risk
Activate microfinance and micro insurance
(Digital Currency)
Proper regulation is necessary because digital currency can be
used to abuse law by money laundering and committing crime
by anonymity, and technical incompleteness.
-3-
U.S.
EU
Japan
Introduction of Regulation
FinCen(2013): Anti-money laundering regulation
applied to exchanges
National Tax Service(2014): Taxation of property
taxes on digital currencies
Futures Trading Commission(2015): Bitcoin
derivative product supervision
State of New York (2015): Bitlicense introduction
Bank Authority(2013): Digital call consumer
warning
European Commission(2016): Anti-money
laundering regulations applied to exchanges
Financial Services Agency(2016) etc. : Applied to
regulations on exchanges, excluding consumption
tax for bitcoin trading
-4-
-5-
(Regulatory Measure)
The regulation of the financial authorities should be based on
the following principles:
1 Do not hinder innovation and cope with risks properly
2 Flexible response to changes in digital currency and distributed ledger
technology.
3 Establish a regulatory system considering the business structure inherent in the
business model
4 Impose market sanctions and induce soundness of related businesses
-6-
by
the
degree
of
granting
functions,
the
. Technical Issues
-7-
(Consortium, etc.)
Since the blockchain is a distributed network-based platform, a
large number of financial institutions and IT companies usually
develop consortia to jointly develop distributed technology.
-8-
Key Features
Established US IT company
R3
Over 60 large financial
institutions including
R3
Goldman Sachs and UBS
Five
domestic
banks
(Kookmin, Shinhan, Hana,
Woori, IBK)
Linux foundation managed
Over
100
companies
including
financial
institutions
and
nonHyperLedge
financial IT companies,
r
domestic
companies
(Korea
Securities
Depository,
Coinplug,
Samsung SDS)
SBI FinTech
Japanese SBI financial group
Consortium Participating in Ripple,
Coinplug, etc.
Led by Chinese enterprise
ChinaLedge Wanxiang
r
Participation in 11 large
financial institutions in China
Developed contract
record management
system (Corda) for
financial institution
Open source
Research and
development of
blockchain platform
R3 and Ethereum
foundation joined as
advisors.
Characteristic
Status
Ethereum
Specialized in smart
contracts Reduced
transaction time (12
seconds)
-9-
Ripple
Specialized in
international transfers
Real-time settlement
liquidation system
- 10 -
(Sector)
Finance
Central
Bank
Governm
ent
IT
Compani
es, Etc.
Utilization Plan
Company
Foreign remittance
- 11 -
Mizuho, etc.
MUFG (Promissory Note),
etc.
England, Netherlands,
Canada
England
Estonia, Russia, etc.
Sweden
Everledger
IBM, Microsoft
Field of
Application
Public
Private
BFT(Byzantine Fault
Tolerance)
Unnecessary
Ensure system integrity
- 12 -
Freedom to choose
R3, Hyperledger, etc.
- Can set range of
information sharing
- High efficiency and
scalability
- Security Vulnerability
Payment system,
identity/document
authentication, trade
finance, smart contract,
etc.
Solutions
Privacy
Authority
Control
Ensuring
Reliability
Scalability
- 13 -
- 14 -