First employee/architect of Kraken here. (Now does >USD$10M+/day of volume by my estimate)
Accounting systems of all kinds should be generic and open source. Why do we need banks at all? It's not like this infrastructure really has any special characteristics. Most of it even has downtime and batch jobs. Fact: The bulk of banking is just recording some numbers at a stupendously simplistic resolution, with maybe 64 characters of description and a date.
A few weeks ago I spent a day interviewing 20 different Hong Kong banks about API availability for cross-border RMB transactions. None at all offered it.
We're reaching a point where the financial systems of a mid-level company exceed those of the banks they are forced to utilize.
Modern requirements include things like: 24x7x365 availability, multilingual, arbitrary asset type support (energy, carbon credits, cryptocurrencies, space, time, etc.), multi-asset type accounts, new settlement networks, real time reporting and AML/KYC, all features API-available, new and established customer interaction through non-snailmail/physical means, customers routinely in different countries, multi-user accounts with disparate access levels (eg. accountant/auditor/spouse/kid), multiple legal jurisdictions with clashing regulatory frameworks, settled-means-settled, regulator-forced free market integration for non-core (ie. account-related) financial services such as loans/forex, redundant service provider availability for every function, meaningful SLAs/reputation for service providers, routing and/or provider selection based upon nontraditional metrics such as ethical investment rationales, etc. The same set of requirements goes up and down the supply-chain: people want to reason with their suppliers and customers about stock, settlement status, payment and contracts, they sometimes need backups in case of failure down the chain, and they care about reputation.
Frankly the whole area is such a mess I am expecting an open source core accounting project to take over the sector. Probably it will begin in smaller/developing world banks and move toward the big guys like a meteor.
I am looking at three problems in the area right now from an operations research perspective.
(1) Physical logistics for food machines http://8-food.com/ and their supply chain
(2) Liquidity and settlement logistics for cross-border payments http://moneyclip.cc/
(3) Energy trading for emergent renewables-focused densely interconnected next generation power grids http://fiberhood.nl/
The goal is to get the core markup defined to the point where an engine can be applied to a formally specified risk model to generate various goal-optimized decisions for for all three domains.
Note that there are also many other domains to which this reasoning would apply such as general logistics, supply chain and generic scheduling mechanisms for resource (eg. power)-constrained embedded systems.
Hey Contingencies, are you talking onshore/offshore China RMB? If so you should know offshore RMB capital flow is strictly controlled by SAFE (State Administration of Foreign Exchange). RMB is NOT freely convertible and is designated by the PBoC as a restricted currency (even though it is in the SDR basket). Look up QFII its one of the few legit ways to move or repatriate foreign capital into/out of China. CNH (offshore RMB) deposits ARE freely convertible and major banks do offer conversions.
Im not totally sure where you think there is a missing gap, but happy to talk more. Email in my profile.
Accounting isn't about the ledger, it's about the myriad of laws at every level. That takes a well funded organization to track the constant stream of changes.
A few weeks ago I spent a day interviewing 20 different Hong Kong banks about API availability for cross-border RMB transactions. None at all offered it.
They don't do it because doing it while complying with all relevant regulations is more complicated than you realise. That's what banks are ultimately in the business of, finding ways to do business across jurisdictions. And it's why most fintech companies fail: their beautiful code runs headlong into the messy, illogical, unpredictable real world of regulatory compliance and guess what, the regulator always wins.
Strongly agree based on my work in the financial sector since 2009. Everything's driven by regulatory compliance now. To the point where RegTech is a thing.
I seriously doubt that, given a signup sheet of legalese, in most jurisdictions any service provided through an appropriately authenticated API is different in legal standing from the same service provided online through internet banking and slow, manual, error-prone process.
Accounting systems of all kinds should be generic and open source. Why do we need banks at all? It's not like this infrastructure really has any special characteristics. Most of it even has downtime and batch jobs. Fact: The bulk of banking is just recording some numbers at a stupendously simplistic resolution, with maybe 64 characters of description and a date.
A few weeks ago I spent a day interviewing 20 different Hong Kong banks about API availability for cross-border RMB transactions. None at all offered it.
We're reaching a point where the financial systems of a mid-level company exceed those of the banks they are forced to utilize.
Modern requirements include things like: 24x7x365 availability, multilingual, arbitrary asset type support (energy, carbon credits, cryptocurrencies, space, time, etc.), multi-asset type accounts, new settlement networks, real time reporting and AML/KYC, all features API-available, new and established customer interaction through non-snailmail/physical means, customers routinely in different countries, multi-user accounts with disparate access levels (eg. accountant/auditor/spouse/kid), multiple legal jurisdictions with clashing regulatory frameworks, settled-means-settled, regulator-forced free market integration for non-core (ie. account-related) financial services such as loans/forex, redundant service provider availability for every function, meaningful SLAs/reputation for service providers, routing and/or provider selection based upon nontraditional metrics such as ethical investment rationales, etc. The same set of requirements goes up and down the supply-chain: people want to reason with their suppliers and customers about stock, settlement status, payment and contracts, they sometimes need backups in case of failure down the chain, and they care about reputation.
Frankly the whole area is such a mess I am expecting an open source core accounting project to take over the sector. Probably it will begin in smaller/developing world banks and move toward the big guys like a meteor.
For some evolving thoughts on the area (from 2012, but literally picked up again in the last 2 days) see http://www.ifex-project.org/our-proposals/ifex