Speaker 1: We have to move fast in briefings, five words that terrify central bankers and their individuals. And those five words are adopted by fintech innovators. Why do regulators have such a concern about this? This model upended a lot of the regulatory approaches in the analog age. Regulators tend to have similar manners regardless of where we are in the world. And they're essentially the same. Maintaining financial stability, protecting the public, and increasing market confidence. Not sexy topics at all. But then there's fintech. Ah, fintech. Cryptocurrencies, NFTs, and DeFi. Oh my. That's sexy. And in the fintech space, you have so many advances that are taking place. They use so many methods to advance finance in the 21st century. You have cryptocurrency exchanges, trading platforms, DAOs, DEXs, and more. But then what of the regulator? You have these innovations because they were born out of a deep distrust of the system. You see, in 2008, there was the global financial crisis. And many said the system was also supported by regulators. So one of the cries that came at that time was done with the central bankers. Of course, discussions can't really get off to a good start if you start off with that type of premise. We all saw how fragile the global economic framework was in 2008. And we see it now because we're seeing some of the same issues. And central bankers are employing quantitative easing. Essentially, that means they're printing money, so it makes money print just overall. And that was told as a fix then and now. But there's still distrust. Inflation, anyone? You see, that last global financial crisis left it to the public to pay very close attention to what was happening in the global economic space. But they're also paying very close attention to the regulator. We just came out of a global crisis. And you might be saying, well, Simone, I thought you were talking about FinTech and not macroeconomic policies. Well, yeah, I am, but just a little bit. Just bear with me. You see, when we talk about global economic policies, you have to look at the international standard setters and other players in the space. The Financial Action Task Force, FATF. They are the standard setter for anti-money laundering and counter-terrorist financing. In the age of FinTech, they issued guidance in relation to virtual asset service providers. They updated recommendations, and they've continued the dialogue. Bank of International Settlements, they are called the central bankers, central bank. And they have an innovation hub based mainly in Singapore and Hong Kong. And they're doing a lot of work in relation to cross-border currency payments. The Global FinTech Innovation Network is a group of a number of regulators and observers seated under the Financial Conduct Authority in the UK. Made up of over two or three dozen regulators around the world, all collaborating on a multiplicity of issues. And they're doing good work. The problem is, it's still not fast enough. When you have innovators employing certain methods, by the time a regulator develops a standard, that standard is underdeveloped in the face of what we actually see, or it's an obsolescence. So, one of the things that we've seen innovators use in this particular space to advance and accelerate developments is a hackathon. They bring talent from far and wide to accelerate the pace of development for a number of different digital platforms, projects, DeFi. And we're seeing a lot of exciting things in this space. They're moving fast and breaking things. Right. We have a little dot on the laptop that needs to be cleared, but panic not. So, we're going to pivot and we're going to look at what regulators do. There we go. The regulatory philosophy is conservative. Might not be shocking that I'm not a conservative regulator. They're also pragmatic and measured. All of these things are what you want in a regulator. Very stable, very sure, very aligned. But I say to the regulators, I am going to challenge your philosophy. When you are faced with the pace of change that we are seeing in the 21st century, it is time to adopt some of the same measures being used by innovators for our own purposes. It is time for us to move fast and break things. Enter the regulatory hackathon. Pivot back to fintech. You have a lot of fintech providers that are continuing their discussion with regulators. They're actually engaging with regulatory constructs. But to bring this out, allow me to tell you a few stories. Or as I like to say, case studies. Let's start with de-risking in the Caribbean. The trigger? The FATF published a guidance document in 2013. The premise? Caribbean countries and other parts of the world, just a few, were seen as higher risk. The result? Correspondent banks left. And it meant that your transfers to the rest of the world cost more and took longer. It takes days and weeks. And it costs more. With a failure rate of 5%. So that means that in 5% of the cases, your money never gets there. I have had my own experiences. Regulators are not immune. In 2021, it took me three weeks to get my money from 125 miles away back here to Roatown. Brad Garlinghouse of Ripple Labs speaks about the internet of money. And he recognizes that without innovation, the fastest way to move money across shores is to get on a plane and fly it there. 125 miles is a 35-minute flight. We are still not moving fast enough. Political leaders in the Caribbean are leaning in and they recognize that there is important work for regulators to do. But they are not quite on the mark. They recognize that something needs to be done. Prime Minister Mia Moore Motley of Barbados has championed this cause for most of this year. And very recently at the United States Congress, she spoke about the issues of de-risking. And by the way, de-risking adds to the cost. It adds to the cost of compliance. It costs you more. You do more due diligence, even when it's low-risk. And let's talk about low-risk, but from the facet of financial inclusion. The United Nations speaks about financial inclusion. It is one of the biggest projects to deal with the under-banked and un-banked within the world. And they're looking at countries like India and Africa, but they're not looking at Roatown. Why in 2022 does it take days for checks to clear between banks that sit less than a quarter of a mile apart? Why does it take you days and weeks to get certain financial services and products? It's because of the cost of compliance. But Caribbean regulators are being held to a higher standard. There's a lot of focus in relation to AML-CFT. And that's important. We do get that. But when you make it more difficult for financial flows, those financial flows go underground, which is undesirable to the regulator and law enforcement. Here is one of the areas where we can regulate to innovate and alleviate the issues. The United Nations and financial inclusion. Do we have financial inclusion methods here? Are we looking at simplified due diligence for the pensioner who is just having a bank account to get their pension money and buy groceries once a week? There are so many things that we have to look at. And as it relates to developing our standards, are we going to wait for the United Nations to do it for us? Or do we do it through our own thought leadership? I know which I would choose. And then there's the narrative about the level playing field. Yes, it is still not level. I have been in this profession for over 20 years. And in that time, I have seen the goalposts move several times. But I'm not here to talk about goalposts. I'm here to talk about moving fast and breaking things. When will the OECD include the British Overseas Territories as a block that has more economic impact than many G20 countries? It is time for us to do it. But we can if we move fast and break things. When will the FATF consider having their own hackathon that includes a broader reach from all different regions? And don't tell me about financial action task force, regional style bodies like the CFATF. I've worked with them. I know how it goes. I've seen it upfront and personal. And I've seen the impacts of when international standards and regulatory developments settle on the pace, leave us behind and have unintended consequences. We need to be at the table so that they're aware of the nuanced issues that we have within this region and within Rohtang. Then there's blacklisting. It's a subjective view. Because you see, we have a number of companies here in Rohtang and they think that they incorporate to avoid taxation when they incorporate for that British common law. Ease of legal clarity. There are a number of issues that you might say, well, Simone, it's important for us to consider other issues. But I would say a regulatory hackathon is needed because you have a lot of focus on AML-CFT. You have a lot of focus on cross-border payments. But who's focusing on prudential regulatory requirements? Let's talk about capital. And no, not capital in traditional sense. I mean like token lockups and escrow for DeFi projects. Who's looking at what the governance constructs would look like for a DeFi platform? We can do that. We have the talent in the region. But only if we move fast and break things. There is so much more I can say in relation to this. And maybe, maybe just a little bit more. You see, I was talking about de-risking in my circumstances. But let's bring it back to Rohtang. Let's talk about that business vendor that's looking to get some supplies in for peak sales. There's an event going on, maybe August. We love our August holidays here. And they send out wire transfer, but it takes too long to get there. And by the time it gets there, the goods can't ship because it's an active hurricane season. And by the time you work out the logistics and the goods arrive, that business owner has missed peak sales that would sustain that business. That story echoes in Rohtang, Bridgetown, Georgetown, or any town in the Caribbean. And feel free to fact check me because I have done my due diligence. Blacklisting, subjective. We look at these shores, at these companies, at the talent that is right here within these shores. And some people will say, no, the Caribbean shouldn't have a stand. But in a race for innovation, let us not forget that the first country with a central bank digital currency was a Caribbean nation. Enter the Bahamas with the sand dollar. So it's clear that we have the talent and the capacity. So what do we do next? Well, I would say there's one word for us. We need to be vigilant. We need to be vigilant. Rohtang, let me take a step back because it's TEDx Rohtang. But British Virgin Islands, we got this. The British Virgin Islands has often punched far above its way class time and time again. This is just another round. We have the talent here. And we can leverage that talent to move fast and break things. So what next? I would lean into one other innovator who says it's the ones who are crazy enough to think that they can change the world. They're the ones who do. Rohtang, my Virgin Islands people, it's another round. It's time for us to move fast, break things, and change the world again. Thank you.