Lecture on 27 November 2018 FinTech Cryptocurrencies Blockchain for Beginners Elective course from the Faculty of Information Technology, Thai - Nichi Institute of Technology, Bangkok for undergraduate students. #BlockchainTNI2018

1. Blockchain Technology
Week 3
Unit II – FinTech and Cryptocurrencies
Ferdin Joe John Joseph, PhD
Faculty of Information Technology
Thai-Nichi Institute of Technology, Bangkok
Venue: D603

2. Week 3 – Unit II – FinTech and Cryptocurrencies
Agenda
• FinTech
• Cryptocurrencies
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3. FinTech in China https://youtu.be/gysKE3POUv0
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4. FinTech – What is?
Technology Finance
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5. FinTech - Definition
• Financial technology (FinTech or fintech) is the new technology and
innovation that aims to compete with traditional financial methods in the
delivery of financial services.
• FinTech is a new industry that uses technology to improve activities in
finance.
• The use of smartphones for mobile banking, investing services and
cryptocurrency are examples of technologies aiming to make financial
services more accessible to the general public.
• Financial technology companies consist of both startups and established
financial and technology companies trying to replace or enhance the usage
of financial services provided by existing financial companies.
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6. FinTech Ecosphere
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7. Trends of FinTech
• Adopting advanced technologies
• Traditional financial institutions: Transformation through fintech
• Establishing a fintech ecosystem
• Import/Export transformation
• The rise of AI
• The ambiguous future of non-tech innovations
• The importance of customer education
• Establishing an effective regulatory regime
• A comprehensive approach to financial risk management
• Using fintech to address systemic risks
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8. Avenues of FinTech
FinTech
Artificial
Intelligence
Open
Banking
Blockchain
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9. Closed Vs Open Banking
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10. Architecture of Open Banking
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11. Benefits of Open Banking
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12. Technical Elements of AI
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Technical
Elements
of AI
Natural
Language
Processing
Computer
Vision
Machine
Learning

13. AI Ecosystem Collaborators
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14. AI and FinTech – The Joint
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15. Blockchain in FinTech
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16. Blockchain – FinTech Ecosystem
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17. Global Blockchain based FinTech
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18. Regulatory Landscape
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19. Why FinTech in Blockchain?
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20. Why Fin Tech
• Cashless Economy or Digital Economy
• Bye-Bye to Fiat Money
• Micropayments possible
• Easier to carry
• Easier to transfer
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21. Why cashless? Case study
• Demonetization in India
• With an overnight announcement by the PM Narendra Modi, 500 and
1000 INR ceased to be legal tender on 8th November 2016.
• Banks in Thailand ceased accepting 500 and 1000 INR to exchange
with immediate effect, including those in Suvarnabhumi and other
international airports.
• People had no or less exposure towards digital transactions. Most of
them relied on fiat money.
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22. Suffering
• People waited in long queues to got new remonetized 500 and 2000
INR currencies from ATMs and Bank counters
Around 150 deaths have been reported during the entire
demonetization process. The deaths include that of
1. People died out of anxiety standing in bank/atm lines.
2. People committed suicides due to inability to meet marriage
liabilities of their son/daughters.
3. Bank staff died due to continuous working for days with no proper
planning.
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Technology
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23. Drawbacks
• It was major setback to unorganized sector. The daily wage workers
lost their jobs due to cash crunch .
• The production of medium scale , small scale and handicraft industry
saw a dip . Even the export of tea declined.
• The GDP growth got retarded in last quarter of 2016.
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24. Demonetization before 2016
• Soviet Union – 1991 – 50 and 100 Rubles
• Ghana – 1982 – 50 Cedis
• Britain – 1971 – All its currency notes
• India – 1977 – 1000, 5000 and 10000 Rupees
• Congo – 1990 – 100 Francs
• Myanmar – 1962 – 50 and 100 Kyats
• Myanmar – 1987 - All its currency notes
• Nigeria – 1984 - All its currency notes
• North Korea – 2010 - All its currency notes
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25. Before FinTech – Card Payments
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26. Drawbacks of card payments
• Transaction charges are more
• Exposure to fraud
• Limits in transactions
• International transfer possible only through certain vendors
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27. Before FinTech – Internet Banking
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SWIFT wire transfer
Intra-country transfer

28. Drawbacks of Internet Banking
• Complicated authentication
• Security flaw due to human error
• Slow (Days to weeks for one transfer)
• Expensive (Transaction charges)
• Limits in transactions
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29. Before FinTech – SWIFT wire transfer
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30. Who is FinTech?
• They may or may not be banks
• Mostly third party vendors
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31. Advantages of FinTech
• Boosts micro economy
• No minimum limit for transaction amount
• Negligible or no transaction charges
• Faster than other payments
• Easy to transfer
• Requires less expertise to learn the process
• Paperless environment. Just a mobile app can do.
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32. Thailand’s readiness to FinTech
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33. FinTech Ecosystem in Thailand
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34. Global FinTech Ecosystem
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35. FinTech Development
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36. Means of Payment
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37. FinTech and Blockchain
• Micropayments possible with cryptocurrencies
• Blockchains use QR code based payments
• Decentralized Apps (DApps)
• FinTech is a major player in Blockchain
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38. Week 3 – Unit II
Agenda
• Blockchain Terminologies
• Cryptocurrencies
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39. Disclaimer
• Neither the lecturer nor TNI advocate anyone to trade with
cryptocurrencies
• We comply with the law and regulations of the Kingdom of Thailand
• Term cryptocurrency in this course is used for educational purpose
only
• We promote usage of Blockchain as a Technology, than using
cryptocurrencies.
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Technology
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40. Cryptocurrency - Definition
“Cryptocurrency is a medium of exchange, created and stored
electronically in a blockchain, using encryption techniques to control
the creation of monetary units and to verify the transfer of funds.”
Example: Bitcoin (BTC)
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41. Advantages of transactions using
cryptocurrencies
• Irreversible
• Pseudonymous
• Fast and global
• Secure
• Permission less. Free of government control.
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42. Most popular cryptocurrencies
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43. Cryptoeconomics
Cryptoeconomics is the study of mechanism design using
cryptographically secure incentive distribution.
Cryptoeconomics focuses on incentive structures that use
cryptocurrencies and virtual currencies.
This allows for financial outcomes for users of a cryptoeconomic
system governed by computer code.
Using financial cryptography (such as smart contracts), both the
production and distribution of a given digital asset can be
determined, allowing for novel systems such as decentralized digital
currencies and decentralized autonomous organizations.
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Technology
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44. Cryptocurrency - Architecture
Blockchain Timestamping Mining Wallets
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45. Cryptocurrency Network Architecture
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46. Alternative Cryptocurrency
• Alternatives to Bitcoin (BTC) aka alt coins
• Examples: ether, ripple, zcash, monero etc.
• Differs in Token structure, consensus method, economy model and
other parameters.
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47. Sidechains’ effect
• Sidechains may replace alt coins using smart contract in future
• Smart contract is a new version of FinTech
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48. Next Week
• Hyperledger and Smart Contracts
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Technology