Crowdaura, a startup that builds technology solutions for financial services firms, had recently been admitted into Accenture’s Innovation Lab program in London.
In addition to being the only fintech startup using blockchain tech to integrate Accenture’s London Lab, Crowdaura is also participating in the Microsoft Ventures Accelerator program in London.
Essentially, what this startup does is design and develop solutions that make the issuance, administration and trading of private placement securities easier, faster cheaper and safer, “so banks, brokers and exchanges can tap into previously uneconomical markets.” One of the innovations that the company is betting on is the blockchain.
CoinJournal had the privilege to catch up with Dr. Avtar Sehra, the founder and CEO of Crowdaura, to know more about his startup, what his team has been working on, as well as his views on the future of blockchain technology in the financial services industry.
CoinJournal: What is Crowdaura and what does it do?
Dr. Avtar Sehra: Crowdaura is providing a service for banks, exchanges and brokers to enter new markets efficiently and effectively. Our technology allows these big players to execute deals that may have previously been uneconomical for them.
CoinJournal: How do you feel about integrating Accenture’s London Lab and what are you expecting from this experience?
Dr. Avtar Sehra: Being part of the Accenture Fintech Innovation Lab is a great opportunity as it gives Crowdaura the access to work with many of our potential clients to refine our product and execute novel proof of concepts (PoC’s). In addition, it gives the larger players the chance to create new business lines.
As history shows, disruptive technologies normally start in areas that are normally unprofitable or too small for larger players, and slowly such technologies become better and enter larger markets.
We are working with investment banks to leverage their brands to enter these small markets and make good margins, but also develop capabilities that will drive greater benefits within their core competencies, e.g. exchange-traded products or OTC markets.
CoinJournal: Can you please explain how Crowdaura is using blockchain technology?
Dr. Avtar Sehra: We don’t believe in building overly simplified PoC’s that have little or no real world production value. All the work we do is connected with real world market/organisational network structures and behaviours, that we call “Crowd Dynamics.”
We look at the market, the business and operating models, and then we try and build a minimal viable end-to-end system that enables frictionless execution in that market.
We have many key services that are pre-developed, and most of these are web based (SaaS solutions), which can all be provided as a centralized “investment bank engine-in-a-box.”
However, the true power is leveraged in networks where exchanges can connect up with brokers, or banks with buy-side clients. In such cases we have developed a Blockchain engine, chain agnostic, that can be leveraged for clearing, settlement and depository services, and executing Delivery Versus Payment (DVP) using fiat currencies.
We are also experimenting with more on-chain functionality; obviously administration of coupons, dividends and voting are the easy wins. But we have a longer term vision connected with chains that have greater compute capabilities, as we feel this is where the future is for truly distributed markets.
CoinJournal: How do you see blockchain technology evolve in the future?
Dr. Avtar Sehra: We think the basic blockchain, as in the Bitcoin Blockchain, either used as a public or private network has the most real world testing, as it has been around for longer. There are obviously some scalability challenges regarding block-sizes to increase throughput, but these will be resolved over time.
For many applications Bitcoin Blockchain is great, and uses of the public chain beyond payments will continue to increase. However, the possibilities are extended if you deploy the Bitcoin Blockchain as a private network, with slight modifications, which enables you to do many creative things and optimize the chain infrastructure to the specific needs of the functional and non-functional requirements of the use case.
For true flexibility, Ethereum is the winner in terms of developing and deploying complex systems very quickly. However, this is a very new technology so I wouldn’t say the public blockchain has been sufficiently tested to trust it with any critical business processes at this stage. Even as a private chain we are being very careful, as its flexibility comes at increased complexity which means there are many unknowns, so when we work with financial services firms we have to show that we are taking security and contingency very seriously.
Then, there are other hybrid solutions that will be coming soon, like the Rootstock side chain, which utilizes the EVM to give smart contract capability within the Bitcoin Blockchain ecosystem.
We think this will create a big impact in the industry. In the long term, there will definitely be some consortium chains being developed, for example in financial services, we will see the emergence of these that will be akin to the growth of Swift and Visa.
But we think this is likely a decade away. Until then most of the real world applications in financial services will be internal or across small networks of distributed players.