Banking on Information with Igor Pejic Author of Big Tech in Finance

In this episode we speak with Igor Pejic, Author of Big Tech in Finance about his WHY, WHAT and HOW to Prevail In the Age of Blockchain, Digital Currencies and Web3.

Transcript

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hello and welcome to banking on

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information today with me is Igor pich

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the author of the books blockchain Babel

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and big Tech in finance how to Prevail

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in the age of blockchain digital

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currencies and web 3 Igor welcome on the

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podcast thank you for having me it's

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now let's start with that very important

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first question based on the book by

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Simon synic start with why why Igor do

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you do what you

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do that's a good question but let me ask

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let me answer that in in two parts so

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first part is why am I working on on

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Tech and the money business and second

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thing is why I'm writing books about

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this because I think it's it's two

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separate but uh strongly connected

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questions uh the first one is well

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basically I spend my entire professional

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life working at the intersection of

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technology and finance uh and I relish

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it right uh why was that because I think

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we're blessed uh to live at an age where

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we have technological progress not just

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accelerating uh but it's accelerating

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exponentially right so we don't have any

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more these long time frames in between

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Innovations and it's also not just one

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technological trajectory but it's

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multiple of them uh so you see uh things

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like AI blockchain um also other areas

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non-digital areas and they're all uh

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they're all advancing extremely rapidly

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and they're also feeding off each other

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so it's very difficult to forecast what

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will happen so it's it's highly

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interesting uh and I'm not just talking

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as I said about digital Technologies but

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it's also things like Genentech biotech

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satellites satellites the new space race

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new ways to harness energy so I think

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really that exploration is kind of the

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the essence of the human spirit and

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that's why I'm very interested in

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finding out what will happen uh what new

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technological potentials would bring and

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and how how we will what we will make

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out of them uh and um that's not just

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the professional interest or personal

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interest in the topic but it's also the

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fact that if we look at the history of

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Technology it has always had a

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tremendously good impact on The Human

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Condition and human life right uh and I

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think that it's just some very important

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trends that we're living through and I'd

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like to do a small contribution to it uh

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but you might ask why not be just

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working on it in the company why not be

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a Founder why not be an innovator uh why

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talk about it all the time why write

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articles and especially why white books

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in such a such a fast-paced environment

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such a fast-paced time as today because

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technolog is literally changing every

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day and yet you have publishing with

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very long Cycles um well quite frankly

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because uh I believe that again if you

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look at the history of Technology there

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have been so many groundbreaking uh

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technology

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invented and um often times they have

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been there for a very long time until

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they actually made a difference and why

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because it takes people to act on those

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Technologies to materialize the

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potential uh that they deliver and I

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think that one way to to make those

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entrepreneurs or managers or whoever

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understand what the technology is and

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where the future is headed to is by

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books I think that books are really the

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best way to learn uh of new technology

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and it's quite simply the fact that you

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have to spend so much time and invest

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all of your cognitive resources uh and

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all of your time for multiple hours

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you're just trying to to understand one

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aspect or one technology and um that's

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quite frankly extremely

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important and uh I think that this is in

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particular important in an age of social

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media that's extremely fast-paced you

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have often times rather shallow

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information but also an age where you

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have many many very good resources right

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ex excellent articles excellent

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reporting and um great in-depth analyses

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but still I think that the book as a

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medium is the best way to have this calm

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introspection uh to learn about the

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complex new thing which a technology is

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and it's not just a technology as I said

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but also its implication in the real

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life so that's why I believe that that

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books are so essential even though

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sometimes they're forgotten in our

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discussion especially about technology

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yeah no that's that is great so you are

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passionate about Innovation not just at

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the intersection of financial uh

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services and Technology but just broadly

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and then you are a teacher you like to

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teach people things you like to do that

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through the medium of writing a book and

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actually putting it down on paper which

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uh I I appreciate that you take that

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time to do that so that is great um

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thank you for sharing your why

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now how in the book like what what are

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you what are you talking about in the

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book How do how do people um learn from

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what you're writing down um tell us a

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little bit about the uh the the big Tech

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in finance book that you've just uh

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released definitely so the way I see it

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or the way I hope that that my readers

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will see it that you know they spend

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maybe 20 to $30 but they get a whole

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bunch of of uh what a research team

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would do and also what a Management

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Consultant would do for thing uh well

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basically big Tech in finance uh like

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like blockchain Babel is uh on the one

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hand a strategic um consideration uh so

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I look at a certain Trend uh in

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financial services that is connected to

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innovation in this case the entry of

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data Giants and and it Giants in general

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into the financial services world and

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not just the entry but also the

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expansion of what they're doing y uh but

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I don't just stop with my own analysis

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uh but I also interviewed uh dozens and

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dozens of experts and not just any

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expert it was really um some of the

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topnotch thinkers on the on that issue

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and whether that be uh Bankers whether

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that be entrepreneurs or or politicians

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Regulators uh so it has been a very very

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wide range of them very wide range of

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perspectives also contrasting

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perspectives uh and basically I try to

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tell on the one hand uh the story of all

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of the opportunities that uh companies

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like Google Apple Amazon bring to the

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table because let's face it they are

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perhaps the biggest scalers of

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Technology out there but on the other

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hand they also show that uh it is on the

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one hand a danger to commercial Banks or

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to other companies whoever is is in the

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business of uh in a business that will

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or might be disrupted uh by those huge

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and hugely impactful players but on the

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other hand it's it's also a

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consideration of more systemic risks

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right uh what could it mean to Financial

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stability uh if all of a sudden billions

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of people flop to let's say the Libra

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coin that Facebook tried to so it's kind

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of a balanced approach uh to see what's

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what's the upside what's the financial

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downside and how do we manage this how

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do we take uh how do we we take

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advantage of of the good things whereas

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try to reduce the systemic dangers that

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we have yeah now now what what would you

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say are like the top two takeaways that

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people should learn learn from the book

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now obviously you don't want to give it

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away all but like what are sort of like

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the top two um nuggets that you can that

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you can share with us

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here definitely um so I think one one U

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nugget of of information would

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definitely be your let's say one one

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lesson that you would learn from the

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book uh would be that a big teac in in

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the past has already entered all kinds

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of Industries in particular the

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financial industry uh on the wings of

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new technologies and of course everybody

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knows Apple pay and Google pay uh in

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China now we have the same even even

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much more pronounced with alipay and we

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pay and so on so they're trying to enter

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uh the payment business on the wings of

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mobile contact lass wallets all of these

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related Technologies uh while at the

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same time those are technologies that

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are maybe seven eight nine 10 years old

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depending on on you

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know which which area you're talking to

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which geographic area you're talking

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about uh and now they are trying to do

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the same thing with blockchain with AI

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with digital assets uh and this time I

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think changes could be much much more

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profound because in the past what you

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had is uh they they focused on payments

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they focused on the customer interface

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now with those more transformational

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Technologies uh they could theoretically

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address any area any segment of Finance

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on the one hand and they could also

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hollow out the entire value chain and

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the second thing is um second lesson uh

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what can be done about it right it's not

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easy to compete with an Amazon or a

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Microsoft or whoever Y and I believe

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that uh you have to write the waves of

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technological progress as well and one

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concept that I introduced in the book is

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the super money engine which basically

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means that you're capable of handling

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all types of assets and not just you

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know holding them but also staking them

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swapping them selling them um

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so processing them in all kinds of ways

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uh and this is kind of the solution of

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how do you succeed uh in tomorrow's

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World despite those very big and very

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strong competitors yeah well that that's

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a great bridge Tomorrow's World you

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mentioned that I I always like to do

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this thing called Futures thinking

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obviously we don't know what the future

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is going to bring but we can think about

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it and we can describe what we think is

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a possible future so I would love for

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you to do that and I think this is right

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in your wheelhouse think 10 years out

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we're in

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2034 what does the world look like what

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do big tech companies what does Finance

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look like give me an idea of what your

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thoughts are what a possible future

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could look like

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yeah so 10 years from now that's that's

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definitely a highly interesting point in

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time because I would say five years it's

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quite easy to to have a forecast um with

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10 years it gets really difficult

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because we humans are very poor in

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judging exponential growth right so we

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tend to

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underestimate uh what will happen in the

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long run yeah and it's really difficult

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to do so if you have a panoply of

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Technologies because as I mentioned they

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feed off each other they impact each

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other so if if we look only at

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blockchain digital assets because I

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think this is something that you can

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answer with a little bit more yeah I

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would say with a little bit more

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certainty I think the major Trend that's

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that stands out to me is that we will

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live in a multi-asset world so people

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come up to me all the time and ask you

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know will Bitcoin take over the

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financial system or will central banks

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issue cbdcs and everything else will be

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gone or is Bitcoin and and crypto just a

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hype and fed and we'll go away and the

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answer is neither all right so we will

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have a world in which all of those

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assets are coexisting uh we will have

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cryptocurrencies we will have Central

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Bank digital currencies we'll have

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traditional cash we will have uh private

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stable coins so which are um which are

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blockchain based currencies packed to a

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fiat currency we have a so called

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deposit tokens issued by licensed Banks

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so there will be all these kinds of of

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assets and also the non-fungible assets

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and I don't necessarily mean pixelated

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pictures or metaverse land I mean I mean

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traditional Financial assets put on a

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blockchain things like IP commercial

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exploitation rights but also things like

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Securities bonds uh commercial real

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estate but also for for a more

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mainstream customer it could be his own

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apartment or a house that I put in a

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decentralized protocol and and uh use it

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as collateral to get a loan so I think

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these are all things that that will

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happen so we will have multiple assets

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and they will be merging with each other

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and that's why I mentioned earlier the

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super money engine uh whoever builds

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this first and is among the first and

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most successful to to scale it I think

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has a very very good chance of of ending

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up at the top of tomorrow's Financial

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world yeah so so we we're you're almost

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there already with the the the the

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answer to my next question which is kind

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of like okay if we do backcasting if we

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see that future of all these different

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assets um both sort of onchain and

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offchain what do we need to do today to

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get ready for that possible future that

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you were

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describing so it it depends from from

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which perspective you're looking at I

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think the most critical is probably the

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regulator uh that's that's where we have

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uh or we could run into very significant

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also systemically important issues right

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uh if I have a mass of people as I just

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mentioned putting their putting their

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apartment in the protocol losing their

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houses what happens right we don't have

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even regulatory Clarity is this

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something that would hold up in courts

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uh what happens if too many people do

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this we have a liquidity crisis uh so

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there's a lot of regulatory things we

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need to we need to um clarify first and

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the second thing is of course you need

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to build the tech technical capabilities

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um but that's kind of difficult at the

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moment uh because not everywhere do we

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have very clear regulation um I have

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good reason to believe that it will in

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the US in particular it will change in

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the next couple of years or hopefully

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even months uh but I think regulation is

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really the number one issue that's kind

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of holding uh big invest Ms back yeah so

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hopefully we'll we'll get more clarity

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on on regulations soon that's probably a

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great point to wrap up on so thank you

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very much igore for sharing your wealth

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of knowledge and looking into the future

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together um where can people find your

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book basically everywhere where you get

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your good books you know Amazon of

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course or you can uh go to your Barnes

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and Noble and all of the other uh big

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and small um book sellers uh they should

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all have it or be able to order it

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perfect so wherever you get your books

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go there and find eigor book big Tech in

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finance how to Prevail in the age of

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blockchain digital currencies and web 3

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thank you so much Igor for being on the

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podcast thank you very much for the

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invitation and until next time choose to

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be curious

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