《穆迪120個區塊鏈項目報告》.pdf

MOODY S INVESTORS SERVICE CROSS-SECTORThis publication does not announce a credit rating action. For any credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page for the most updated credit rating action ination and rating history.2 21 July 2016 Credit Strategy – Blockchain Technology Robust, Cost-effective Applications Key to Unlocking Blockchain s Potential Credit BenefitsBlockchain explainedBlockchain, as the name suggests, is a “chain of blocks of encrypted ination” that a database or ledger . Each block can bethought of as record of some transaction between two-or-more parties, which all have real-time access to the shared database. Asencrypted blocks are added to the chain, it becomes prohibitively expensive to alter the record of a particular transaction because everyblock added after that particular block must be unencrypted.Blockchain arrived on the scene over seven years ago when the bitcoin ‘cryptocurrency’ became available as an alternative paymentsystem that, among other things, eliminated the need for either a trusted middleman or a centralized institution for paymenttransactions so-called decentralized trust.1 To function as designed, bitcoin requires a transfer process that ensures the sender ofa particular asset is the true owner and has sufficient assets to make the transfer; blockchain serves this function. see Exhibit 3,“Overview of blockchain technology”, pages 3 and 4 below. Although bitcoin opened horizons for wider adoption of cryptocurrencies,that outlook has been clouded by regulatory challenges, currency volatility, questions regarding scalability and instances of illegal use.However, the new money is on alternative applications of blockchain technologyWhatever the future may hold for cryptocurrencies, the underlying transaction-tracking and certifying technology of blockchain2 holdsconsiderable promise. Cryptocurrencies can theoretically be deployed as an alternative in “any transaction” where a third party iscurrently needed to certify the integrity of the transaction. By sharing a real-time ledger among participants and/or removing thirdparties from a transaction, blockchain can increase the speed, affordability, security, reliability and/or auditability of various businessprocesses within and outside of financial services. The technology holds particular promise for the transfer of assets as well as otherservices centered around trust and security.While blockchain start-ups multiply, large diversified companies are actively assessing the technology. Many blockchain start-upsare attracting venture capital VC, increasingly from interested corporate investors. As of mid-July 2016, around 149 bitcoin andblockchain start-ups had raised aggregate VC investments of more than 1.2 billion Exhibit 1. In addition, over the first quarter of2016, blockchain and hybrid companies3 raised more VC investment 84 than cryptocurrency start-ups 16, as more ‘pure play’blockchain start-ups launched and existing cryptocurrency start-ups pivoted toward providing broader blockchain solutions Exhibit 2.Exhibit 1Venture Capital Investment in Blockchain and CryptocurrencyStart-ups Is Growing RapidlyExhibit 2Pure Play Blockchain Companies Taking Venture Capital Sharefrom Cryptocurrency CompaniesNote Data includes start-ups focusing on both cryptocurrency and non-cryptocurrencyblockchain technology.Source Coindesk, Moody’s Investors ServiceNote Hybrid companies include start-ups focusing on both cryptocurrency and non-cryptocurrency blockchain technology.Source Coindesk, Moody’s Investors ServiceMOODY S INVESTORS SERVICE CROSS-SECTOR3 21 July 2016 Credit Strategy – Blockchain Technology Robust, Cost-effective Applications Key to Unlocking Blockchain s Potential Credit BenefitsOverview of blockchain technologyExhibit 3MOODY S INVESTORS SERVICE CROSS-SECTOR4 21 July 2016 Credit Strategy – Blockchain Technology Robust, Cost-effective Applications Key to Unlocking Blockchain s Potential Credit BenefitsSource Bitcoin.org, Deloitte University, Evry, Bank of England, Moody’s Investors ServiceA blockchain can be developed in a public, private or consortium context.4 For each use case an appropriate type should be selected.? Public or permissionless a fully decentralized plat that moves data storage and verification away from a single pointof control, is open to everyone in the network and lets anonymous members, without trust established among each other,participate in the ledger e.g., bitcoin. Given the absence of trust, consensus s e.g., proof-of-work5 generally slow downthe transaction-validation process and use lots of electricity.? Consortium or hybrid a partially decentralized plat controlled by a group of pre-selected members that know each other.Validation by trusted members, is much easier and cheaper compared with permissionless solutions. Such a model may provebeneficial to a consortium of companies in a similar industry among whom trust is already ensured.MOODY S INVESTORS SERVICE CROSS-SECTOR5 21 July 2016 Credit Strategy – Blockchain Technology Robust, Cost-effective Applications Key to Unlocking Blockchain s Potential Credit Benefits? Private or permissioned one centralized organization has write and validation permission to the ledger and authorizes readaccess. Under this framework the central organization is empowered to change rules or revert transactions, as needed. As such, thiswould work well for company internal databases.Initially, financial institutions, corporates and governments shied away from blockchain given that its first application, the bitcoinblockchain, is fully decentralized and allows anyone to transact anonymously without a central authority that can intervene, if needed.However, the partially decentralized private and consortium solutions each allow for some of central control, and have attractedmore interest and support since they appear to be more compatible with current legal and regulatory frameworks.A powerful concept that blockchain technology could leverage is ‘smart contract’ coded protocols; i.e., contracts among severalparties that are self-cuting and/or self-enforcing by automatically verifying, cuting, and/or enforcing contractual clauses oncepredetermined conditions are triggered Exhibit 4. These protocols could considerably reduce admin costs as they can be cutedbilaterally, while also eliminating uncertainty around the exact terms or the cution process.Exhibit 4Schematic Example of a Smart ContractSource Tim Swanson, R3, Moody’s Investors ServiceFully implemented blockchain is still some time awayAlthough market participants are mapping a large and growing landscape for blockchain applications, the tangible territory forfully implemented blockchain solutions beyond bitcoin is limited and is likely to remain so for up to a decade or longer. Only whenblockchain applications solve real-world problems – providing user-friendly applications with a high level of stability and governance –will substantial ground be gained, paving the way for further investment and progress.Blockchain development will need to allow for deliberate, in-depth analysis and testing, as well as the incorporation of the newtechnology with existing technology. Many ‘proofs of concept’ of blockchain use cases have been put forward, but the next step willfocus on how to operationalize the technology and integrate it into current processes and systems. Collaboration across companiesand industries would benefit the development of the technology since its highest value will likely be derived from interconnectednetworks among different institutions, rather than from closed networks within an institution.Blockchain will only embed itself in a given industry once solutions have been found for its hurdles see page 6 and its benefitsare proven to outweigh the additional investment cost required to develop and employ it as a replacement technology. A deepcost-benefit analysis of each blockchain use case will reveal if blockchain technology makes sense or if alternative technologiescould provide similar benefits in a more cost-efficient manner. Additionally, blockchain technology could be obviated by other newtechnologies that becomes available and reach industry-standard status before blockchain reaches scalable viability.MOODY S INVESTORS SERVICE CROSS-SECTOR6 21 July 2016 Credit Strategy – Blockchain Technology Robust, Cost-effective Applications Key to Unlocking Blockchain s Potential Credit BenefitsWeighing blockchain s benefits against key outstanding hurdlesThe general advantages that blockchain technology presents are increased speed, reduced cost, and greater security, reliability andauditability of processes and transactions. However, each of the potential applications of blockchain comes with specific benefits anddrawbacks. The technology is still in its infancy, and successful large-scale blockchain implementations have thus far been limited.Although numerous theoretical solutions and small-scale proofs of concept show promise, there are many outstanding questionsaround system compatibility, regulatory treatment and legal enforceability, among others Exhibit 5.Exhibit 5Blockchain s Key Potential Benefits vs. Outstanding HurdlesSource Moody s Investors ServiceMOODY S INVESTORS SERVICE CROSS-SECTOR7 21 July 2016 Credit Strategy – Blockchain Technology Robust, Cost-effective Applications Key to Unlocking Blockchain s Potential Credit BenefitsPotential use cases abound across industries and the official sectorWe summarize below 25 illustrative blockchain use cases that show how the technology could potentially improve processes across a widevariety of industries Exhibit 6. We discuss a few examples in more detail below and provide more detailed descriptions in Appendix 1 onpage 11. We believe that most of these solutions, if successful, will be built as private and/or consortium blockchains, allowing for some of central control.Financial institutions have been actively participating in the development of blockchain-based solutions e.g., payments, post-tradelife cycle in capital markets, trade finance as a means to gain cost efficiencies in times of constrained bank profitability. However,blockchain has potential applications beyond financial institutions, including for nonfinancial corporates and the official sector.Exhibit 6Selected Potential Blockchain Use CasesSource Moody s Investors Service? International payments current international payment processes, including remittances and foreign exchange transactions, areslow and expensive, particularly across currencies and national boundaries. A blockchain application could solve some of theseissues, by using digital tokens or currencies.– Blockchain start-up Ripple unrated is actively developing enterprise blockchain solutions for international payments. Itcreated a payment protocol and exchange network with a much faster consensus than the bitcoin blockchain andintroduced its own cryptocurrency, the ‘XRP’. In June 2016 Ripple received a virtual currency license in New York.– Many different large global banks started partnerships with Ripple to improve cross-border payment systems. To date ithas partnered with 12 of the top 50 global banks and has completed over 30 bank blockchain projects. Santander UK Aa3Negative/A1 Stable, a3, for example, is testing a new payment app with 6,000 of its staff that enables next-day transfersbetween the UK and 21 countries.– Also, three major Australian banks are testing Ripple’s payment technology. Australia and New Zealand Banking Grp.Ltd. ANZ, Aa2/Aa2 Stable, a1 and Westpac Banking Corporation Aa2/Aa2 Stable, a1 focus on payment tracking, andCommonwealth Bank of Australia Aa2/Aa2 Stable, a1 on payment settlement between its different subsidiaries globally.? Capital markets blockchain technology could be applied throughout the life cycle of securities e.g., equity, debt, derivatives,repos, loans, asset-backed securities and commodities in the areas of 1 issuance, ownership and trade; 2 post-trade clearingand settlement; and 3 custody and securities servicing. A shared synchronized blockchain among participants could eliminate theneed to reconcile various independent ledgers and improve process workflows, with a clear view of asset and/or process ownershipthroughout the chain, as well as leverage smart contract technology to eliminate some manual processes.– Nasdaq, Inc. Baa3 Positive is actively pursuing blockchain-based capital market solutions. It developed, in collaborationwith blockchain start-up Chain Inc unrated, a blockchain for trading of shares of pre-IPO private companies on Nasdaq Linq.MOODY S INVESTORS SERVICE CROSS-SECTOR8 21 July 2016 Credit Strategy – Blockchain Technology Robust, Cost-effective Applications Key to Unlocking Blockchain s Potential Credit BenefitsIn December 2015 an issuer, namely Chain, successfully transacted a private security to an investor on the Nasdaq’s Linqblockchain. The ownership record was digitally represented, settlement time reduced significantly and the need for paperstock certificates was eliminated. Separately, Nasdaq is also developing a blockchain-based shareholder e-voting service forshareholder meetings of companies listed in Estonia on the Nasdaq’s Tallinn Stock Exchange.– A collaboration of seven firms successfully cuted post-trade life cycle events for North American single-name credit defaultswap CDS transactions on a permissioned blockchain with smart contracts. The firms include Bank of America CorporationBaa1 Stable, Citigroup Inc. Baa1 Stable, Credit Suisse Group AG Baa3 Stable, The Depository Trust the demo presentation by UBSGroup AG Baa2 Stable of a smart bond built on Ethereum with fully automated payments; and blockchain start-up DigitalAsset Holdings unrated ongoing development of a blockchain to replace the legacy equity security clearing and settlementsystem of the Australian Securities Exchange unrated.? Trade finance blockchain technology could automate the still manual trade finance process. Some opportunities include 1transing letters of credit to smart contracts with automated payments; 2 digitizing printed documents, such as bills of ladingand storing them as metadata; and 3 creating a record of ownership in each step. This could result in lower costs, increasedefficiency, improved transparency, reduced risk for fraud and reduced human errors.– DBS Group Holdings Ltd Aa2 Negative and Standard Chartered PLC A1 Negative partnered up with Ripple in a blockchain-based trade finance trial called TradeSafe . In cooperation with Singapore s IT and telecommunication authority, the Infocomm Development Authority , they placed 60 mock trade finance invoices on a blockchain.– IBM Aa3 Negative focuses on digitizing