Navigating the DeFi/Capital Markets Collision at Consensus 2023

The imminent convergence of traditional finance and DeFi has created a need to build the foundations to support a shared ecosystem. As the incumbents start to adapt, new technology promises to disrupt the standard models. As the architects of a new financial ecosystem, our responsibility is to build the technical, regulatory, and legal frameworks that support growth and innovation, while safeguarding the true interests of users. This is why, during Consensus 2023, I’m looking forward to participating in the multiple conversations that will arise around this.

‌‌Here are the main topics that have captured my interest.

Setting the Stage for Consensus 2023

Consensus is the world's largest, longest-running and most influential gathering that brings together all sides of crypto, blockchain technology and Web3 communities. The event held in Austin, Texas, is often regarded as a prominent event for heavyweight players in the blockchain and crypto industry. If you know where to look, the event agenda itself will reveal critical industry concerns, along with where you might find the most valuable insights.

‌‌Upon reviewing this year’s, several recurring themes stand out: First and foremost, regulatory compliance is a top concern for everyone. Second, this is predominantly due to an urgency from both the DeFi and TradFi sides to create a clear path for institutions to participate in DeFi.

‌‌The aftermath of this tumultuous year in crypto will determine who is fully established and prepared to integrate with the blockchain industry. As an example, the panel, "Crypto is (Still) Inevitable," by Ryan Selkis, CEO of Messari –a leading DeFi data analytics firm– will delve into the arguments for and against crypto’s proposed solutions. Messari's research reports and data have provided strong guidance for builders, investors, and stakeholders within Web3, and Selkis' talk will likely offer a data-driven analysis of the evolution of DeFi.

‌‌Another topic of conversation that will doubtlessly be present everywhere is characterized as “government overreach." The topic is gaining traction as the discontent from the sector against the regulatory angles pursued by governments grows. On that note, former U.S. CFTC Chairman J. Christopher Giancarlo (who advocated for a "do no harm" approach to crypto regulation) is set to provide a starting point to discuss the future of money and the value of sovereign and non-sovereign digital currencies.

Innovating Compliance and Regulations

‌‌One topic I’m particularly interested in Consensus 2023, is the role of compliant-friendly data protection solutions.

‌‌Consumers still require privacy in their transactions, and privacy is a major trust driver in technology. As privacy-unfriendly CBDC solutions loom in the horizon and the global macroeconomic landscape shifts, Zero-Knowledge technology is naturally emerging as a way to preserve user privacy while retaining compliance, allowing parties to prove the authenticity of information without revealing the information itself.

‌‌ZK technology can be leveraged for many other use cases, such as blockchain scalability and (as stated) privacy, but I suspect the most interesting conversations will revolve around its use for compliance. The US and other jurisdictions have already taken note of this potential use case, and the ball is now on the DeFi industry’s court to propose and educate regulators on solutions to adopt it.

Consensus 2023 And Institutional Capital

As institutions find their way into DeFi, some conversations also will naturally begin to shift towards the approach they should follow once in.

‌‌The Consensus 2023 panel "Where Does TradFi Go From Here? Recalibrating the Risks and Opportunities" will aim to provide insights that can guide institutional investors on how they can ensure their investments in cryptocurrencies align with their risk appetite and investment objectives. Dawn Harflinger, Matt Halstead, and Dan Tapiero will spearhead this talk, alongside moderator Joe Marenda, Global Head of Digital Assets Investing at Cambridge Associates. As experienced investors who have effectively managed and allocated billions of dollars in capital, I'm interested in hearing the perspectives they've gained through navigating the present investment landscape.

Collaborating for a Unified Future

‌‌As the industry continues to evolve, early adopters who establish strong networks and relationships will find themselves at the forefront of shaping the future of finance. The successful integration of traditional finance and DeFi requires not only a technically secure infrastructure and self-governing identity solutions but also direct engagement and collaboration among all stakeholders and participants.

‌‌As we navigate through a tumultuous year and the end of a seemingly long crypto winter, we stand at a crossroads. The decisions we make now will pave the way for a much-needed wave of adoption. It is often said that bear markets are the breeding ground for builders, and witnessing the evolution of conferences like Consensus from their early days only reinforces this notion.

‌‌By fostering open dialogue, embracing innovation, and working together, we can create a unified ecosystem that is both accessible and secure. I look forward to coming together, sharing ideas, and forge the connections necessary to drive the industry forward, ultimately shaping the future of finance for the better.

About Panther

Panther is a chain-agnostic privacy layer that allows users to access DeFi privately and compliantly. Its users can execute transactions and deploy assets across DeFi. Panther’s zero-knowledge primitives are also generalizable to KYC, selective disclosures between trusted parties, private ID, voting, and data verification services.

Users access Panther’s privacy by depositing assets from different chains into Multi-Assed Shielded Pools (MASPs or simply Shielded Pools). Shielded Pools exist in different chains, interconnected by zBridges. Using DeFi Adaptors, users can also deploy their assets into DeFi dApps/Protocols, or they can transact with and swap them privately within MASPs.Since Panther’s privacy is enabled by zero-knowledge proofs, users can disclose any part or the whole of their transaction history to anyone at will. They can also choose to withdraw their assets from MASPs into stealth addresses. Panther also features ZK- and non-ZK Reveals.