Usually when we need to understand our business’ numbers, we open Microsoft Excel and start applying filters, pivot tables and charts to try to gain insight on what story our data are telling us.

It’s 2017, Isn’t there a better way to do this?

I think it must have been around 2014 when I first heard about Tableau. I immediately liked the tool’s proposal: Easy tool to analyse data in real time without needing to be an expert in SQL, Olap cubes, or any technology. It could take as input for data any number of excel sheets, csv files, or database sources and would immediately allow the user to move the data around, establish relationships between sets of data and start visualising. I’m a visual person, I need to see things in graphical form to understand them, so I really like this concept. In the Gartner Magic Quadrant for Feb 2017, the 3 top players in the BI space by completeness of vision and capacity of execution are Tableau, Microsoft, and Qlik who offer similar solutions for front end analytics.

One of the weak points that I see in Tableau’s proposal is that it only addresses the front end, the data analysis, but leaves the back end, the data model, the origin of data, for you to deal with. In the past I’ve worked on a few data warehousing projects where the immense complexity was in creating a data model which made sense from a business perspective and which could grow with the business’ future needs. Designing the data model wrong was similar to shooting yourself in the foot, as future needs could not be adapted, changes would require refactoring of the whole data model and of the downstream systems which read from this data model and maintenance of this data model would be expensive and complex. In all cases I experienced in the past, creating a data model was similar to creating a monster which would grow in unforeseen and inelegant ways getting more rigid and patchy as time went by.

A good example of a world class level attempt at creating a data model for the capital markets world is  ISDA’s (International Swaps and Derivatives Association) FPML (Financial Products Markup Language). The data model they have birthed is immensely complex, as could not be different when the goal is to be able to map any financial instrument. Any attempt at using FPML as inspiration for your data model promises a long and complex project.

Three weeks ago, I attended Moneyconf. There I saw a company called gooddata which offers an interesting model: They take care of your Business Intelligence needs as a service. You send them your data, they organise it and offer you a Tableau style front end tool to visualise it. This would take care of all data warehousing troubles.. however I have some concerns:

1. How do they know all the ways you need to structure your data model?
2. Does this scale well with big volumes of data?
3. How do they manage confidential data? Imagine I have medical records to manage…
4. Is the front end tool as complete as Tableau?

The BI world is very cool looking. It brings promise of granting better insights and fancy looking charts, but, is the price tag worth it when we can always just grab an excel and start applying filters, pivot tables and charts to understand the story our data are telling us?

In 2008, the first Distributed Ledger Technology (DLT) was created with Bitcoin. Immediately it became visible across industries that DLT technology could be very useful to transfer assets. As time passed, different implementations have come to light using the concept of the DLT which attempt to address different problems with different implementations of a similar idea.

One of these implementations is IBM’s Hyperledger. In late 2015, IBM partnered with 17 other companies:

• Blockchain software vendors such as Digital Asset, or R3
• Technology platform companies such as Intel, RedHat or VMWare
• Financial services firms such as CME, DTCC, Deutsche Borse, Swift or JP Morgan
• System integrators such as Accenture.

The Hyperledger project’s governance is chaired by Blythe Masters (Ex-JP Morgan Executive, CEO of Digital Asset) under the Linux Software foundation. This open governance allows the open source community to contribute to the project, read the source code, download it for free and use it to create new software.

The vision for Hyperledger is a tool for confidential asset transfers in an enterprise environment. These assets can be of any nature: Securities, gold, legal contracts, wills, patents, medical information… Key differences with other DLT solutions such as Ethereum, are that there is no cryptocurrency involved and that access to transaction information is restricted with access rights. Whereas in Ethereum every miner node has a copy of the whole blockchain and can access all the information of any transaction, in Hyperledger all information is encrypted, and only thanks to having the right access rights can you decrypt and access certain information. In a corporate environment this would be a mandatory requirement as you may want to give one client a 10% discount without all your clients knowing about this.

Some interesting projects going on in the corporate world using Hyperledger:

• CLS is working on a payment netting service
• DTCC is building a DLT based derivatives processing platform
• Japanese Stock Exchange is testing DLT for trading environments
• Walmart is building a platform with Hyperledger to track where a Pork chop came from in 7 minutes instead of the current 7 days
• Digital Asset are building a tool that will leverage hyperledger to offer DLT to the financial services community.
• Northern Trust has built a DLT for private equity

Currently there are hundreds of players in the DLT world, in my view the top 4 are R3 Corda, Ethereum, Bitcoin, and Hyperledger. It is hard to tell who will come out ahead in the end, but Hyperledger is certainly worth keeping an eye on.

Imagine you are driving your car at 90kmh, and you realize the brakes are not working. 20 meters ahead of you, crossing the street, are five people who will inexorably die if you run them over. Looking to your right you see one person which is sitting in a terrace eating an ice cream. Your steering wheel is working well, so you could steer your car towards the terrace killing one person, but sparing the five.

What would you do? Most people would choose to kill the one person to spare the five. Sacrificing one life in order to save five seems the right thing to do.

Now imagine you are standing on a bridge overlooking the road. Down the road comes the brakeless car, and at the end of the road are five people who are about to die run over by this car.

You feel helpless to avert this disaster, until you notice, standing next to you on the bridge, a very heavy man. You could push him off the bridge, on to the track, into the path of the car. He would die, but the five people crossing the road would be saved. To make your job even more similar to the previous example, this man is standing on top of a trapdoor which you could open by turning a car-sized steering wheel to the right.

Would you push the unsuspecting fat man? Most people would find it terribly wrong to push the man onto the track. But this raises a moral puzzle: Why does the principle that seems right in the first case – sacrifice one live to save many – seem wrong in the second?

This example, taken from a beautifully taught Harvard online free course goes to explain how the consequentialist moral reasoning of Jeremy Bentham’s utilitarianism (it is the greatest happiness of the greatest number that is the measure of right and wrong) does not hold under the scrutiny of Immanuel Kant’s Categorical moral reasoning (Act only according to that maxim whereby you can, at the same time, will that it should become a universal law).

After 11^th May 1997,when IBM’s Deep Blue beat human champion Garry Kasparov, no human will ever again, beat AI at chess.

After 27^th May 2017, when Google’s Alphago beat human champion Ke Jie, no human will ever again beat AI at Go.

Once AI driven cars are mainstream, no human will ever again be allowed to drive.

While a human driver has visibility of 120 degrees, an AI has 360 vision from the car, through connectivity could simultaneously have 360 vision from other neighbouring cars, from traffic cameras, or from satellites. Other AI senses could come into play which the human counterpart does not have, for example an AI car could have sonar, similar to bats echoing a signal to detect proximity. An AI could have real time knowledge of where every other car in a radius of 10 kilometres is, in what direction it’s headed, and if it has any technical issue.

Human drivers get road rage, get impatient when sitting in a traffic jam, try to stick their car’s nose in front to gain one inch if possible… all these human behaviours cause traffic jams, accidents and inefficiencies. A perfect AI driver will have none of these traits, and thanks to this, traffic jams will be greatly, if not totally, reduced.

Having a human drive in the future will be as rare as having a human clean the clothes today. I could do it, but why woud I? I have a washing machine for that.

One human problem, is what to tell the AI to do when faced with the example at the beginning of this story. Should an AI follow Jeremy Bentham’s utilitarian principles? Should it choose to kill one to save five? This is particularly dangerous if we will also want the AI to perform surgery, as in order to save 5 patients who needed a heart, a lung, a kidney, a liver, and a stomach, it could choose to kill and butcher a perfectly healthy patient which had just gone to have a regular check-up in order to get the needed organs.

In the brink of a new era, these classic, unresolved questions are more important than ever.

This week I attended moneyconf, a very interesting conference where startups and incumbents meet to discuss the future of fintech. Here are some wisdom-pearls I took away from c-level executives of multimillion incumbent companies and startups:

1. “We spend 2.5 billion euro per year on innovation, to run the bank and to change the bank” Francisco González. President of Bbva
2. “You have to change from inside the bank” Francisco González. President of Bbva
3. “The core has to be built by ourselves. If it’s available outside we buy it and we bring it into our systems” Francisco González. President of Bbva
4. “We had a Ferrari, the big mistake was not to pay attention to the rest of things, drivers, roads…” Francisco González. President of Bbva
5. “The most important thing to change for incumbents is having the right management. We had to mix digitals and bankers.” Francisco González. President of Bbva
6. “We alone could not go, we needed the help of the fintech companies” Francisco González. President of Bbva
7. “The disruption of AI has nothing to do with fintech, because the world is going to fundamentally change.” – Neal Cross Chief Innovation officer DBS Bank
8. “85% of all customer service requests are handled by chatbots.” – Neal Cross Chief Innovation officer DBS Bank
9. “At Mastercard we enable people to move from one department/country to another they want to learn, to grow” – Anne Cairns President of Mastercard.
10. “Financial inclusion starts with giving people a digital identity” – Anne Cairns President of Mastercard.
11. banks will realise they need to be on a public or at least semi public network. Peter Smith. Founder and CEO Blockchain.com
12. “the Bitcoin core vs bicoin unlimited issue can be worked around by the industry by moving to other tokens ” Peter Smith. Founder and CEO Blockchain.com
13. “disruption is helping companies raise capital, that’s the innovation I’m interested in, not doing step 9 in the banking settlement process” Peter Smith. Founder and CEO Blockchain.com
14. “ ECB, EIB, can stimulate the real economy by lending to small businesses through LendingCircle” Samir Desai, Founder and CEO of Lending Circle
15. “We return about 6.5-7% a year on our loans. Investors have made £120 million in net interest.” – Samir Desai, Founder and CEO of Lending Circle
16. “The big thing now in Europe is PSD2. Banks will have to provide open API access to current accounts.” – Samir Desai, Founder and CEO of Lending Circle
17. “P2P lending has proven to be resilient. Growth remains 60% even with Brexit” Samir Desai, Founder and CEO of Lending Circle
18. “What banking will be in three years from now is not yet invented” Bernardo Sanchez Incera. Deputy CEO at Societe Generale.
19. “Identity algorithms 20x safer than human.” Brett King, Founder and CEO of Moven
20. “By 2025 the biggest bank will be a technology company, not a bank” Brett King, Founder and CEO of Moven
21. “No human will be able to drive safer than a self-driving car. Decide on investments, build a car faster..” Brett King, Founder and CEO of Moven
22. “The problem with banks is they think always in terms of iterating the branch model.” –Brett King, Founder and CEO of Moven
23. “We’re seeing banking embedded into other services now. That’s when it is most useful, solving real problems.” –Brett King, Founder and CEO of Moven
24. “A futurist is never being wrong today” Brett King, Founder and CEO of Moven
25. “With etoro you can create an account in 60 seconds, fund it with your credit card and buy bitcoin.” Yoni Assia. Founder and CEO of EToro
26. “EToro launches Crypto-currency CopyFund to provide a straightforward way to invest in both Bitcoin and Ethereum online” Yoni Assia. Founder and CEO of EToro
27. “Many financial services still run on fortran and cobol since the 70’s. Blockchain gives an opportunity to rethink all” David Rutter. Founder and managing partner at R3
28. “11.000 computer scientists at goldman sachs. The challenge is to build fast and secure applications” Joanne Hannaford. Partner at Goldman Sachs.
29. “Bitcoin or Ethereum blockchain will be used in the background, the user will not know. E.g @abra @epify “Jon Matonis. Founding Director at Bitcoin Foundation
30. “Any idiot can lend a dollar, it’s getting paid back that’s tricky” Douglas Merrill. Zest Finance.
31. “The car will pay for gas, the phone for calls and data thanks to IoT” Ivan Glazachev. Yandex Money.
32. “There is a huge fight to be the fintech capital of the world” Taavet Hinrikus. CEO of TransferWise.
33. “Innovating to please ourselves vs innovating to please the customers” Yashish Dahiya. Founder and CEO at Policybazaar
34. “People with +10y in the same company try to avoid the erosion. Younger folks see the disruption coming and want to ride it” Scott Walchek Founder and CEO of Trov
35. “Innovation has to come from the top. Don’t do pilots. Anticipate your champions will move on. Appoint full time account mgmnt on both sides. Results will take time. Empower a steering committee with all stakeholders” Scott Walchek Founder and CEO of Trov
36. “We are seeing and pushing a trend towards a cashless society” Rita Liu. Head of Alipay Europe, Middle East and Africa.
37. “Payment technology has to be transparent, seamless” June Yee Felix. President of Verifone Europe.
38. “In the past payment has been very complicated. People want to pay simply. Like Uber.” June Yee Felix. President of Verifone Europe.
39. “San Francisco Venture Capital investment in fintech is double New York, which is double of all of Europe. 2 deals in China are bigger than San Francisco.” Sheel Mohnot Partner at 500Startups
40. “EU regulatory sandox is a great idea we are pushing to get adopted in the US”  Sheel Mohnot Partner at 500Startups
41. “Sharing of KYC information thanks to the blockchain can enable cross border payments in a regulated environment” David Thompson CTO at Western Union
42. Western Union Reveals Pilot Coinbase Integration. David Thompson CTO at Western Union
43. “Banks will do the back end, the Apples and Googles will do front end. As banks, we can’t prevent that happening.” – Anne Boden. CEO at Starling Bank
44. “Trust comes from utility. I trust the bank because I can go to an ATM and get my money out. It works.” Brett King, Founder and CEO of Moven
45. “70% of mobile payments in China are done by wechat and alipay, not by banks” Brett King, Founder and CEO of Moven
46. “Banks will reduce their workforce 40% by 2025, but there are not enough AI people …yet” Roman Stanek, CEO of GoodData
47. “Machine intelligence is the last invention that humans will ever need to make” Roman Stanek, CEO of GoodData
48. “If banks figure out transparency and user experience they might reinvent themselves. But many won’t make it.” – Taavet Hinrikus. CEO of TransferWise.
49. “The only bank branch that matters is the one we carry in our pockets.” – Taavet Hinrikus. CEO of TransferWise.
50. “There is still no alternative to a bank to store your money. This will change” Taavet Hinrikus. CEO of TransferWise.
51. “Currencies are like loyalty points with a standing army” David Birch, Director of Innovation at Consult Hyperion
52. “Sending money to your mother in the philipines will be free” Mike Laven CEO at Currency Cloud
53. “Central banks, commercial banks, companies, criptography, communities will be 5 creators of currency in the future.” David Birch, Director of Innovation at Consult Hyperion
54. “The world is going to have a better way to send money between countries. This can be Bitcoin, Ethereum..” Mike Laven CEO at Currency Cloud
55. “Our customers are spending 15-50hrs / year with their bank account online and only 1-2hrs in branch.” Derek White. Global head of customer solutions at Bbva
56. “At Bbva we take selfie videos, share them across our google social network and teach each other” Derek White. Global head of customer solutions at Bbva
57. If the developer understands how the problem is solved by the machine it’s not AI. That’s just rule based. AI is not taught the solution
58. “Insurance underwriters, claims representatives, bank representatives, and financial analysts jobs will be replaced by robots” Roman Stanek, CEO of GoodData
59. “80% of work in Financial advisory, fraud detection, legal work, AML, customer services, Backoffice, will be done AI-first.” Roman Stanek, CEO of GoodData
60. “Mobile first is outdated. We are going to AI first” Roman Stanek, CEO of GoodData
61. “India is leading the way in the path to financial inclusion. Universal ID. Removing cash..” Michael Schlein. CEO at Accion
62. “Historically credit is only given to people who you have data on. Big data will bank the unbanked” Michael Schlein. CEO at Accion
63. “The UK post brexit will be so busy negotiating banana import rules that they will have no time for fintech” David Birch, Director of Innovation at Consult Hyperion
64. “The EU passport is quite cool, in USA you need to deal with different regulation per state” Taavet Hinrikus. CEO of TransferWise.

Visa transfers 2,000 transactions per second, whereas Bitcoin transfers 7 transactions per second. If bitcoin wants to establish itself as a currency that can be used daily by 7bn people worldwide it needs to scale up. What can to be done for Bitcoin to scale up its transaction processing volume?

1. Do nothing. Since the popularity of Bitcoin is growing, the demand for transactions is growing. Since there is more demand than capacity, and the miners are processing first the transactions which offer a higher transaction fee, the cost of sending money with Bitcoin is going up. Currently an average bitcoin processing fee is 101,700 Satoshis, which is worth 2.5 USD. This means that paying for a cup of coffee with Bitcoin would cost another cup of coffee in payment fees. This also means that the backlog of unprocessed transactions is growing. At the time of writing this there are 507 unconfirmed transactions. At a rate of 7 transactions per second, if no more transactions are received, it will take 2.20 hours to confirm the backlog. Imagine having to wait 2.20 hours for your coffee payment to go through.. doing nothing does not seem like a viable option.
2. Increase the block size. By design, Bitcoin generates one block every 10 minutes. This block can fit in as many transactions as possible as long as it’s size is below 1MB. One simple solution would be to increase this 1MB limit to 20MB for example. This would fit many more transactions per block, and the speed at which transactions are processed would increase. Bitcoin Improvement Proposal BIP100 describes this. The problem with this increase is that larger blocks would make full nodes more expensive to operate, which would decrease decentralisation as some nodes would no longer be able to bear the cost. A hard fork would be needed, risking splitting bitcoin in two cryptocurrencies, and all of this would not give a final solution, as the block size would need to increase periodically to support all the world’s future transactions. Off-chain transactions would be the only long-term solution.
3. Use each block more efficiently. In December 2015, at the Hong Kong Bitcoin Scaling event, Pieter Wuille introduced the idea of Segregated Witness, a modification to bitcoin which would reduce the amount of information needed for each block. This freed-up space could be used to introduce more transactions per block. The advantage of this approach is that it can be done with a soft fork minimising the risk of splitting bitcoin into two cryptocurrencies.
4. Minimise the number of on-chain transactions. Joseph Poon & Thaddeus Dryja wrote in January 2016 the Lightning network whitepaper. This would enable minimising the number of transactions that need to go into the blockchain by adding a layer on top which would create one to one payment channels. These payment channels which would be fully collateralised IOUs between counterparties would form a network with which a payment could be routed. This is similar to the concept that Ripple is using, which in turn is similar to the concept of correspondent banking.

A heated debate has split the Bitcoin community for the last year. Developers, miners, markets and users could not agree on how to solve the problem, as every option had risks.

At the Consensus 2017 Conference an agreement seems to have been found. The option agreed is to implement Segwit with a 2MB block. Although even after this middle ground has been found, heated debate goes on.

Hopefully the bitcoin community will be able to find a way to find consensus, not only in the blockchain, but also in the way to evolve in order to meet the challenges that will be found.

On 30^th April 2016, a group of developers, mostly coming from slock.it, created the first Distributed Autonomous Organisation on the Ethereum network. They called it “The DAO”.

Through an Initial Coin Offering (ICO), people could buy their DAO token. In 28 days, The DAO raised over 11 million Ether (ETH) which at the time was equivalent to $150m, making this the biggest crowdfunding in history. An ICO is a controversial way to raise money since it is unregulated and it gives buyers no ownership like equity shares would. Ownership of these DAO tokens would grant voting rights to decide what project to allocate the DAO’s capital to.

On 14^th June, an attacker managed to take advantage of a bug in the way The DAO was coded and took 3.6m Ether into a child DAO, which had the same rules as the parent DAO, not allowing the attacker to retrieve the money during the first 28 days. The Ethereum foundation had 28 days to defuse this bomb. This created a big controversy in the cryptocurrencies world:

1. The attacker argued that that money was rightfully his, since he had taken advantage of a “feature” of The DAO which allowed his action. In the smart contracts world code is law as the smart contract can be understood as a contract written in programming language.
2. Part of the Ethereum community was in favour of letting the hacker take the money. They argued that things that happen on the blockchain should be immutable. And that modifying/censoring/corrupting the past would be a slippery slope which would open a door to do it again in the future for other reasons.
3. The other Part of the community was against letting the hacker take the money. Their arguments were that the community could have the last word in these cases.

On 17^th June Vitalik Buterin proposed a soft fork update in the Ethereum code, which would block the child DAO from allowing funds withdrawal. This would buy more time to decide what to do without the money disappearing. However, hours before its planned release, the developers detected that this would open the possibility for a denial-of-service attack. The update could not be released. The hard fork was the only way left. This hard fork would transfer all balance of the DAO to a new smart contract which would only allow the legitimate owners to withdraw. In order to decide whether to implement this hard fork or not, an online referendum was held where each Ether held gave right to one vote. The outcome of this referendum was in favour of the hard fork by 89% so the hard fork was implemented and a trigger was set in pace for it to activate when reaching block 1920000.

On 20^th July, block 1920000 was reached in the Ethereum blockchain. The DAO Hack was reversed. However not all miners agreed to this and kept the previous version running, creating a new cryptocurrency called “Ethereum Classic” (ETC). Both blockchains are identical up to this block, on one, the DAO Hacker was unable to claim his prize, on the other he kept it. At the time  I had 200 ETH in my Kraken account, the day after I had 200 ETH and 200 ETC, their valuation in Euros was wildly different as the Market gave higher value to ETH than ETC.

A hard fork is a change in the blockchain protocol which is not backwards compatible. If all users agree to follow, then there is no issue, but  if some decide to stay and not accept the change, a new blockchain is created which will run in parallel and compete in the blockchain space against the original.

In the 2012 summer Olympics, Oscar Pistorious, who had lost both his legs when he was 11 months old, competed both in the Paralympic games and in the Olympic games. He was able to run at an Olympic level thanks to his artificial limbs. He didn’t win, but he still runs faster than 99% of humans despite missing both legs.

Adrianne Haslet-Davis, a ballroom dancer, lost a leg In the 2013 Boston Marathon Bombing. Thanks to Hugh Herr and MIT’s Centre for extreme bionics, she can dance again.

Hearing aids are common as a prosthetic to help people hear, these could be enhanced to allow people to focus hearing on a distant conversation, connect them to the internet or to an alexa style AI,  or be a phone, effectively giving a holder of this prosthetic an advantage over the rest of humans.

Artificial knees or hips are common prosthetics which enhance non life-threatening issues. MIT, and Elon Musk’s Neuralink , are independently investigating how to enhance these artificial limbs to connect them to the nervous system, connecting the brain directly with machine interfaces. If this happens, this interface could become faster than our normal reflexes, potentially allowing an enhanced human to dodge a bullet.

Anthony Atala has been able to print a kidney, George Church, from Harvard Medical School is using human genome to create any organ. Sergio Canavero is scheduled to transplant a human head by end of 2017. Dmitry Itskov has set out to copy the human brain to a computer within the next 30 years.

If humanity becomes able to transfer a head to another body, then it would be reasonable to assume it could be transferred to another input/output mechanism. If memory and consciousness can be copied, then the body could be swapped for a robot which could live for long periods of time, work on our behalf, clone itself, or travel the galaxy to terraform distant planets.

These enhanced prosthetics, once they become a reality, would grant normal humans with extraordinary abilities: eyes which could zoom in, record, see holographic projections of internet data. Exoskeletons which would allow to lift heavy weights, run or jump faster. Brains directly connected to the internet, stronger bones and muscles, perfect hair…

There will come a time where being a Homo Sapiens will be a handicap. Get ready for Homo Cyborg.