ISO20022 Strategic Positioning

[pifragile]

Project Abstract

TL;DR: Integrating blockchains with the traditional financial world will take time and it does not make too much sense to blindly implement technical features without clear benefit but rather to invest in stategic long-term positioning.

In a previous article published by the applicant and funded by the W3F, we gave an overview of how other blockchain ecosystems comply with the ISO20022 standard and how Polkadot could integrate with the standard itself. The bottomline of the research was that such an integration is a huge step as a seemingly unbrigeable gap between a protocol designed for communication between trusted third parties via private channels and a permissionless, transparent, decentralized blockchain. We understand that in order to request for further funding, the W3F asked to present a plausible business case for such a project.

After an extensive outreach on LinkedIn to 60+ representatives of all major swiss bank's innovation labs and having conversations with various representatives in the banking and blockchain industry, we failed to come up with a concrete business case for such an integration due to the issues stated above. Nevertheless we see potential in observing the landscape of banks, ISO20022 compatible players, central bank digital currencies and other blockchain ecosystems, as to us it obvious that in the long run the two now seemingly incompatible paradigms of doing financial transactions will move closer together and therefore it will be valuable for Polkadot to be strategically well positioned in this game.

W3F Grant ISO20022 Ecosystem Research and Technical Design

• Application: https://github.com/w3f/Grants-Program/blob/master/applications/ISO20022-Implementation-POC.md
• Submission: https://github.com/w3f/Grant-Milestone-Delivery/blob/master/deliveries/iso20022-ecosystem-research-and-technical-strategy.md

Grant level

• Level 1: Up to $10,000, 2 approvals
• Level 2: Up to $30,000, 3 approvals
• Level 3: Unlimited, 5 approvals (for >$100k: Web3 Foundation Council approval)

Application Checklist

• The application template has been copied and aptly renamed (project_name.md).
• I have read the application guidelines.
• Payment details have been provided (Polkadot AssetHub (USDC & DOT) address in the application and bank details via email, if applicable).
• I understand that an agreed upon percentage of each milestone will be paid in vested DOT, to the Polkadot address listed in the application.
• I am aware that, in order to receive a grant, I (and the entity I represent) have to successfully complete a KYC/KYB check.
• The software delivered for this grant will be released under an open-source license specified in the application.
• The initial PR contains only one commit (squash and force-push if needed).
• The grant will only be announced once the first milestone has been accepted (see the announcement guidelines).
• I prefer the discussion of this application to take place in a private Element/Matrix channel. My username is: @_______:matrix.org (change the homeserver if you use a different one)

[semuelle]

Hey @pifragile, sorry for the wait here. Can you clarify the intended payment and milestone structure? Two reports, one per half year?

[pifragile]

Hey @pifragile, sorry for the wait here. Can you clarify the intended payment and milestone structure? Two reports, one per half year?

Hey @semuelle, sorry for the confusion. My idea is to setup a recurring mandate with a report every 6 month, each worth 7200 CHF which corresponds to 1 day of work per month. I designed this application to only cover the first of those reports as I assumed you might want to reevaluate this grant after each report. If you are willing to grant more than one report in this application, I am happy to commit to that.

[keeganquigley]

Hi @pifragile thanks for all the work you've put into this area of research so far. Your previous grant and paper were well-received, and helped me understand some of the technical limitations that exist when integrating with these payment systems.

That being said, we are in the process of evolving the grants program as ecosystem needs change. With most of our focus on the upcoming hub launch, this isn't a huge priority for us at this time. Therefore I personally won't approve it for now, but will let you know if this need changes in the future.

[pifragile]

Hi @pifragile thanks for all the work you've put into this area of research so far. Your previous grant and paper were well-received, and helped me understand some of the technical limitations that exist when integrating with these payment systems.

That being said, we are in the process of evolving the grants program as ecosystem needs change. With most of our focus on the upcoming hub launch, this isn't a huge priority for us at this time. Therefore I personally won't approve it for now, but will let you know if this need changes in the future.

@keeganquigley Thank you, sure I understand that. How will the grants program be evolved? What are the areas where help is welcomed most?

[semuelle]

Hi @pifragile, thanks again for the application and the patience. The committee discussed the proposal again today and ultimately decided not to support it, main reasons being that research on the status of general developments in other ecosystems isn't a focus of the Grants Program. Also, we aim support projects over a short term, so given the lack of direction in this area, it makes more sense to revisit the topic at a later point.

We hope that this does not deter you and that you will continue working in this direction. Feel free to apply again if the landscape changes or you have other project ideas you want to pursue.

[pifragile]

Thank you @semuelle.