Jump to content
  • Colin Ng
    Colin Ng

    Sign in to follow this  

    Brexit, Blockchain and borders: Fantasy or Reality?

    In the run up to a pivotal moment in our country’s history, it’s only to be expected there will be a growing sense of urgency, political drama and blanket media and social media coverage. Brexit, with it’s all encompassing remit, is definitely living up to this.

     

    Time is running out
    Political jousting from all parties, including the now defunct UKIP, has been the norm since negotiations began last year, with new revelations taking the spotlight every week. Currently it’s Irish border backstop an issue which has been there from the beginning.  With less than six months to go before Brexit, the fact that it remains unresolved speaks volumes about the enduring complexity of this situation in itself.

     

    How do you solve a problem like the Irish border?

    The Irish border has become controversial. Both the UK and the EU do not want a ‘hard border’ dividing the island of Ireland for obvious reasons – peace, freedom of movement and a lucrative trading relationship.

     

    The Financial Times reported that Ireland has €65bn of annual trade with Britain. According to Parliament research papers, in 2016, the UK had a trade surplus of £12bn with Ireland – having a ‘hard border’ post Brexit may put a lot of this at stake.

     

    Theresa May’s Chequers plan proposes a new all-UK customs union with the EU to take effect if no other solution can be found. Michel Barnier, the EU negotiator rejected this proposal on the basis it undermines the principles of the existing EU Customs Union.

     

    To avoid a hard border, both sides need to agree a backstop in the event that an alternative longer term solution cannot be found. 

     

    The longer term solution

    The complexities of border trading have come into sharp focus. Both sides have put forward numerous proposals ranging. From staying in the Customs Union, to performing the customs checks away from the border, to technological solutions as suggested by the Chancellor of the Exchequer.

     

    Technology 
    Is Blockchain the way to solve this complex issue? This emerging technology underpins cryptocurrency transactions and offers a transparent and immutable record of the movement of goods from start to finish. This has great potential to enable an easy and objective way of applying checks and taxes for goods between the UK and the EU and removing/minimising the need for custom checks at or away from the border.

     

    Throwing in some ‘Smart Contracts’ into the mix (which are essentially codes in the Blockchain that executes an action when pre-defined conditions are met), we may have the future of an invisible customs border. But how far into the future are we talking about?

     

    Too much too soon?
    In an ideal world, this technology will be easily and readily accessible and maintained by all parties and businesses on either side. But in reality, we are more than an 18-month transition period away from widespread understanding and application of Blockchain.  

     

    The flaws in the ability of Blockchain to solve the border issue have been argued by many.  It’s an incredibly uneven playing field too. Small to medium sized businesses may find it less accessible than larger firms, and as it is not yet a globally accepted and trusted technology there will be resistance due to a lack of understanding and the necessary regulations required to ensure it is robust.

     

    While Blockchain does not address some of the key political questions of whose Rule Book will be applied in Northern Ireland and to what extent it applies to the rest of the UK, there is potential but not in the short term.

    So, how do you solve a problem like the Irish border? 


    While all bets are off right now, and that may change in the immediate future, the race is on.

    • Like 3


    Sign in to follow this  

    Share this  

    Member Feedback



    Recommended Comments

    Luuk Jacobs

    Posted

    I think it is definitely not reality yet i.e. I can see the benefits of blockchain for data as they form one record of for example a trade of a security. With goods you can create also the associated data stream of the good (where it was produced, how it was shipped and any other step within the value chain till it reaches consumer. The big difference with goods is as I understand that this blockchain of data needs in some way to be associated with the unique good/product. Yes you can add small and cheap electronic devices to a good and create the link withers blackchin data. the challenge will be that this device remains connected to the unique good and is not prone to fraud .... Or am I missing something

    Share this comment


    Link to comment
    Share on other sites
    Share this  

    Become a member to read more and join the discussion

    Members can read and contribute to discussions

    Apply

    Register now for free access.

    Create your account

    Sign in

    Already a member? Sign in here.

    Sign In Now

  • Our picks

    • FSTP LLP in partnership with AlgoMe invite you to a lunchtime round table discussion on the most pressing issues in today’s industry; digital skills shortage and the apprenticeship levy
       
      Introducing your hosts:
      FSTP LLP, a Main Provider for Apprenticeships offering Financial Services, Leadership and Management Apprenticeships, will be on hand to share insights and experience AlgoMe, the community for the Investment Management industry, connecting professionals from Asset Managers, Wealth Managers and FinTechs with their wider industry ecosystem will be on hand to discuss skills and transformation in the industry  
      The event:
      12.30 - 12.50
      Your co-hosts Rob Carter and Andy Milner, AlgoMe will give an overview of demand for retraining and tech skills, based on the latest AlgoMe report; The Disrupted Career: FinTech, Innovation and The Future Of Careers In Investment Management Followed by Philippa Grocott and Nicola Spennati from FSTP LLP, will give an overview of opportunities for using the apprenticeship levy and how to do so effectively within the industry sector 12.50 – 14.00 Group discussion over lunch
       
      Attendance is limited and on a first come first serve basis. Please contact andy.milner@algome.com if you would like to attend.
        • Like
      • 0 replies
    • The Disrupted Career
       
      Welcome To The AlgoMe Report On FinTech, Innovation And The Future Of Careers In Investment Management
       
      This report aims to address key questions that are important to everyone working in or looking to join the Investment Management Industry.
       
      How significant will the impact of FinTech be on career paths? How likely is my current role to be affected? Where are the opportunities in this disruption? How can I best position myself for future success?  
      We asked a panel of Investment Industry professionals their views.
       
      The full report is available for download to all AlgoMe Community members. Not already joined? Becoming a member takes less than a minute.
        • Like
      • 0 replies
    • With the decorations up, the last order date for Amazon nigh and most of us looking forward to at least a few days break, it’s always a good time to take stock of what’s been achieved over the last 12 months.
       
      For AlgoMe this has been another exciting year.
       
      January started in style with the launch of the AlgoMe Careers mobile app – giving professionals the opportunity to find their next career opportunity on the move.
       
      Then in July we released our Industry Pulse Report – a check on what the industry was thinking about key topics such as Brexit, Pay Gap Reporting, MiFiD II and GDPR. Unfortunately it seems that the uncertainty that the industry was feeling due to Brexit is unlikely to have receded in the intervening period, but it’s good to see progress starting to be made in other areas such as gender and diversity.
       
      In September we launched AlgoMe Community – a place for the Investment / Asset Management industry to come together, providing professionals with ways to grow their knowledge, profile and network. We’d like to say a big thank you to all of the members that have joined and contributed and look forward to continuing growth in 2019.
       
      In November AlgoMe joined the Investment Association, becoming a Fintech member and working closely with Velocity, the Association’s new Fintech accelerator. This is a really exciting initiative and we’re looking forward to doing more with Velocity in the near future.
       
      We also launched our Mentoring matching service in November – designed to help AlgoMe Community members connect with the best individuals within the community to help them to reach their career goals using a simple but intelligent process. If you haven’t already signed up to be a mentor or a mentee, please do spend 5 minutes now and tick off a New Year’s Resolution early.
       
      As we go into the end of the year, we have also launched our survey on Investment Management, Fintech and the future of careers. The impact of Fintech on the industry is going to accelerate rapidly in 2019, but what has been less well documented is the impact on individuals, their careers and the skills they’ll need to succeed in a more digitised environment. We really value the input of our community members, so please spend a couple of minutes filling out the survey and we’ll make sure you’re the first to hear the results early next year.
       
      From me and the AlgoMe team, I wish you all a very happy holiday season and look forward to another year of exciting announcements and change in 2019.
       
      Rob
       
        • Like
      • 0 replies
    • I have always struggled to see a fair reason why employers should be allowed to ask about a potential hire’s current remuneration, other than to give them an advantage in pay negotiations.
      It’s something which can only exacerbate existing pay inequalities and  it’s abolishment can surely only be a positive thing.
      Here the Guardian argues specifically about its impact with regards to the gender pay gap:
      https://www.theguardian.com/commentisfree/2018/aug/23/gender-pay-gap-current-salary-question
      I believe this has already been outlawed in some US states?
      @Jonathan Max - would be interesting to hear the view from HR. 
      • 10 replies
    • The Investment Association recently gave the industry a boost when it announced the launch of Velocity, its FinTech accelerator.  Designed to identify, develop and accelerate best in class firms with innovative solutions, Velocity will champion and facilitate the wider adoption of technology across the industry.
       
      And AlgoMe will be involved in this too, which is why I’m excited to announce we are now a member organisation of the Investment Association as an official FinTech member and have been named a "company to watch" by Velocity.
       
      Challenging Times
      The Investment Management industry faces major challenges and opportunities from forces such as digital technology, pressure on fees and increased regulation, while at the same time there are widespread changes in the workforce and their expectations.
       
      To date, Investment Management has both been fairly insulated from the challenges posed by agile FinTech competitors, but also distant from the opportunities offered by the new technologies and ways of thinking that such companies bring.
       
      Bringing FinTech closer
      Velocity is a fantastic step towards accelerating the adoption of FinTech. It has received support and endorsements from both inside and outside the industry, including from the Chancellor of the Exchequer, Phillip Hammond, who was enthusiastic about the initiative at a recent City event.
       
      To drive change and innovation, the industry needs to connect across different disciplines and areas of expertise, driving new ways of thinking and fostering cultural change.
       
      Without the benefit of emerging FinTechs and their external expertise, it will be hard for incumbents to harness the benefits of emerging technologies such as Straight Through deal Processing (STP), Distributed Ledger Technology (DLT), and Artificial Intelligence (AI) in areas such as risk and compliance, securities trading and investment decision making.
       
      Our Mission
      AlgoMe's mission is to connect the Investment Management industry and empower professionals to manage their careers. Our new product, AlgoMe Community, is placed to become the hub for the discussion between FinTechs and the companies and professionals in the wider Investment Management ecosystem.
       
      Join AlgoMe Community today
       
      AlgoMe Community - community.algome.com
        • Like
      • 0 replies
  • Related Content

    • Jonathan Max
      By Jonathan Max
      What does PM Boris Johnson Mean For Markets?
      WWW.MORNINGSTAR.CO.UK The new UK Prime Minister is expected to cut taxes and boost spending, but a lack of clarity on Brexit is holding back UK shares...  
      In theory....Boris' promise of lower taxes and increasing government spending could be good news for certain sectors such as housing. 
      The rather large elephant in the room however is a rather simplistic view of Brexit with a further extension or general election perhaps more likely than a 31 October departure....
       
    • Lydia Francis
      By Lydia Francis
      The following is a brief overview of the Treasury Select Committee meeting with the Financial Conduct Authority on 25th June 2019.
       

       
      Woodford Investment Management
      Unsurprisingly, the highly anticipated subject of Woodford Investment Management’s (WIM) shortcomings was the first topic for discussion at the meeting.
       
      The following observations are FSTP’s own view of the possible implications of Woodford Investment Management’s demise (we still don’t know what we don’t know and feel this subject has got some distance to run before all the facts are known).
       
      Key points:
      This failure of a retail fund will have serious and lasting impact on the operation of Asset Management in the UK.
      It throws into sharp relief the requirements falling out of the FCA’s Asset Management Market Study, in particular the need for independent Non-Executive Directors (NED) to challenge at Authorised Fund Manager (AFM) level and the production of qualitative value for money statements for all UK funds.
       
      From what we heard, we suspect there will be changes to the rules governing the liquidity of funds which retail investors are able to invest in. Andrew Bailey (FCA’s CEO) highlighted the Regulator’s view that European Union (EU) legislation has failed to manage retail funds. However, FSTP is concerned about an over reliance on principles based regulation (i.e. living within the ‘spirit of the rules’) in this area of Financial Services. Our clients operating in this arena are always looking for clarity and are generally welcoming of prescriptive rules in this area.
       
      Despite the introduction of formalised rules on product governance via MiFID II’s implementation in January 2018, distributor/manufacturer relationships and due diligence arrangements appear to be falling well short of regulatory expectations. We surmise that this is likely to result in a greater degree of regulatory intervention.
       
      The remuneration of individuals will attract the attention of the wider media and public as this situation develops. In this instance the Senior Managers and major beneficiaries of fees charged are one and the same. On the face of it there appears to be precious little individual accountability and a lack of challenge by others – the prevailing attitude seemingly being, “We pay ourselves what we think we are worth”. However, when that premise is built upon the investments of retail investors (bear in mind how much pension fund money will be tied up here) there has to be a day of reckoning. The message? If you are not providing retail investors with the service they have been led to expect, you cannot continue to reward yourselves so disproportionately. In short, Senior Managers must now be seen to be taking a more overt, moral stand on what is right and fair.
       
      Bailey was very strict to follow what he’s already told the media and the Committee’s Chair Nicky Morgan’s question, “Does anyone at the FCA read the papers and listen to what’s going on in the industry?” received a curt reply.
       
      The question, “Is it a failure of rules, or a failure of FCA supervision?” received a straight forward response of, “A failure of rules”, with Bailey’s reasoning being that whilst WIM has often had long periods of strong performance and long periods of poor performance, in this instance it is has not been able to save the situation, or the many reputations that have been tarnished as a result.
       
      The responsibilities of Link – the AFM for Woodford Funds – was centred on by Bailey who reiterated the regulatory contact that is now well publicised. The Committee observed that Link – previously owned by Capita – did not have a good record of managing Investment Managers on behalf of investors, given they were at the centre of the Arch Cru issues. (N.B. An article in the FT on 25 June alleges that the FCA pressured WIM into using the services of Link – as the largest provider of ACD services – in order for the necessary regulatory permissions to be granted).
       
      The relationship between WIM and Hargreaves Lansdown (HL) was raised by the Committee and it became obvious that once the immediate issue of fund liquidity is resolved, a review of the relationship between distributors and manufacturers will be instigated. (N.B at the Investment Association’s annual Policy Conference on Wednesday (26 June) Morgan remarked that the methodology behind Wealth 50’s composition raised questions as to whether customers are being treated fairly, after the TSC received a letter from HL confirming that its influential Wealth 50 list was not solely compiled on performance and that WIM’s inclusion on the list, despite under performance, was impacted by fee discounts offered to the platform).
       
      Justice for individuals
      A common theme throughout the discussion was ‘justice for individuals’. There is a high degree of dissatisfaction with the complexity of regulation and the consequent lack of clarity for consumers and practitioners alike, with the suggestion being made for the FCA to sort their impenetrable verbiage as most people don’t understand certain aspects such as T&Cs. This concept was understood by attendees from the FCA, who proceeded to mention that they do have enough resources to deal with all issues, and a review of systems and capabilities needs to be looked into.
       
      The FCA was forced to comment on its responsibilities under the Equality Act, bearing in mind TSC’s disappointment with the Regulator’s response to the report, ‘Consumers’ Access to Financial Services’, published by the Committee in May 2019. FCA’s Chairman, Charles Randell, stated that this is, “By no means us saying we don’t take our responsibility to consumer vulnerability very seriously”.
       
      Culture
      Culture was brought into question and Randell mentioned that the FCA’s focus is shifting to outcomes supported by principles. After some bad tempered exchanges Rushanara Ali, MP quipped, “Some would argue that you are not tough enough with bank bosses…are you too nice to bankers. Is it better to be feared, than liked or loved?” Bailey’s quick response of, “I don’t get up in the morning hoping people will love me”, will surely resonate for some time. He also added the FCA has 650 investigations currently underway, compared to the 250 when he took on the role.
       
      Brexit
      Of course, Brexit did rear its head and Bailey made frequent references throughout the discussion to the fact that regardless of the issues raised and the revisions suggested, Brexit will have a big impact on the FCA’s plans, such as the intended investment in data analytics. However there will be one area that can be assured of relatively no change post-Brexit, the Senior Managers & Certification Regime – it was made clear that the Regime will be implemented in its entirety.
       

       
      And finally....
       
      Overall, Randell (above left) and Bailey (above right) held their own against some intense questioning, but one wonders how much Bailey’s ambition to be the next Governor of the Bank of England tempered his responses.
       
      This was first published on the FTSP LLP blog.
    • Andy Milner
      By Andy Milner
      Interesting to read the information and response to Facebook's announcement last week.
       
      Even less hot headed commentators are saying that this could cause significant financial instability - if it gains traction.
       
       
      Facebook's Libra coin cryptocurrency, explained
      WWW.WIRED.CO.UK Facebook has finally revealed its cryptocurrency plans. Here's what you need to know about the Libra coin and the company's own Calibra wallet  
    • AlgoMe
      By AlgoMe
      Opportunities for asset management in a rapidly changing world.
       
      Join us at The Investment Association’s Annual Policy Conference 2019, the IA’s flagship event and one of the most influential platforms for debate about the future of asset management in the UK. This year's conference will focus on how the industry can capitalise on growth opportunities and overcome the imminent challenges in a rapidly changing world.
       
      High level speakers will provide key insights on how the asset management community can utilise technology and innovation in order to deliver better outcomes for consumers; attract the best talent pool in a dynamic world of work and maintain the UK financial services industry’s global influence in a post-Brexit era.
       
      https://www.theia.org/events-training/event?eventtemplate=168-the-ia-annual-policy-conference-2019&event=357
       
    • Eva Keogan
      By Eva Keogan
      Direct quote from Investment Week: The number of firms in the UK reporting their Gender Pay Gap (GPG) figures by the deadline has fallen by more than a thousand, amid claims firms have restructured businesses or transferred staff to avoid being obliged to report, or have ditched reporting altogether under the perception they will not face repercussions.
       
      Is anyone working for a company which has done this? Is it time to name and shame as has been threatened before? Your thoughts are welcome.
       
      This is quite worrying to read and it's not just Investment Week which has reported on this but to down size companies so they are below the 250-person threshold for reporting is incredibly cynical. Has anyone found evidence of this? Also, using Brexit as a smokescreen is not going to wash next year.
       
       
      Gender pay gap reporting falls as asset managers unveil mixed results
      WWW.INVESTMENTWEEK.CO.UK More than 1,000 fewer firms reveal figures  
Debug info for admin:
appcms
modulepages
controllerpage
topics/forum ID52
page ID
PHP user agentCCBot/2.0 (https://commoncrawl.org/faq/)
×

We use cookies to give you the best possible experience. If you continue, we’ll assume you are happy with this. For further information, see our Privacy Policy.