Capitalizing on the new digital economy
CATHY MINTER, CHIEF REVENUE OFFICERNOVEMBER 2022

Cathy Minter,
Chief Revenue Officer,
R3

Financial services is still the largest industry in the world—yet challenges are
emerging

Unsustainable operating costs
Billions in daily trading andsettlement costs across asset classes

Threat of obsolescence

Growing technical debt

New entrants, technologies, anddecentralization are moving faster than
traditional financial markets andorganizations

Classic ‘hub-and-spoke’ systems are
outdated and require organizations tobear the burden of building, maintainingand securing applications

By embracing the new digital economy these challenges can be turned into
opportunities

Create new financial instruments

Smarter workflow and businessprocesses

A scalable, distributed
infrastructure

Tokenizing assets and currencies
enables fractionalization thus creating
new sources of liquidity

Digital assets and currencies can begoverned and orchestrated so that they
can be traded frictionlessly, with trustand settled in real time

Centralized models are evolving into
distributed networks where the level ofdecentralization is within theorganization’s control

R3’s collective Power of 3 de-risks innovation

Trust Technology
R3’s trust technology foundation—Corda and Conclave—powersolutions that deliver digitaltrust.

+

Connected Networks
Trusted partner to the world’s
leading institutions—banks, FMIs,
global systems integrators, cloudproviders and fintechs.

+

Regulated Markets Expertise
Actively engaged withregulators around the world,
deep financial services knowhow, and expert professionalservices.

Corda is R3’s flagship trust technology platform•A performant, scalable, and secure distributed
infrastructure•

Enables trading and settling of digital assets
and currencies in near real time•

Modular stack—use the whole infrastructure or
only workflows and ledger•

A platform that grows with you so you cangradually distribute and decentralize•

Private, permissioned to power regulatorycompliant solutions

400+375+

8Ecosystem participants

Staff in 14 Countries

Offices globally

400+
Applications built on Corda

170+
Professional Services projects

Leading financial institutions are starting their digital currency and asset journey

Banks

Financial Market
Infrastructures & Exchanges

Fintechs

Central Banks

Powering innovation at world-leading institutions

CorporatesDigital currencies are on the rise••••Central Bank Digital Currencies (CBDCs)

Fiat-backed Stablecoins

Singapore, Hong Kong and India are all in
active trials in-region
R3 has been active in CBDC use cases since2016
Currently engaged with Bhutan, Kazakhstan,and Pacific Islands
Benefits of CBDCs include• Banks are creating their own tokens backed
by commercial bank reserves• These tokens can be used to settle
obligations intrabank, with corporate clients,
and across networks• Eliminates the delays associated withpayment networks

ooo

Programmability of money
Better liquidity management
Faster cross-border payments

R3 & ADB Cooperation Agreement for cross-border multi-currency securities
settlement system PoC

Accelerating our collaborations on ADB-funded andledprojects
both CBDCsonand CSDs
Accelerating
ourincollaborations
ADB-funded and led projects in both
CBDCs and CSDs

•R3R3Bank have been collaborating
andandADBAsian
have Development
been collaborating
since2020.
since2020• The MOU will support the collaboration in exploring therelevance of DLT for ADB’s institutional priorities and insupport of its operational priorities.
• Together we will explore DLT use cases across CapitalMarkets, Digital Assets, Identity and KYC, Sustainability,
Trade Finance and CBDCs.

Project Dunbar
CBDCs for international settlement
SOLUTION• Dunbar team built a multi-currency shared settlement platform onCorda• Commercial banks accessed CBDCs directly instead of via
correspondent banks, streamlining settlement

RESULTSRESULTS

Faster settlement• Reduced time for KYC/AML, onboarding and compliance workflows

Reduced exposure to FX
movements

CHALLENGE

New CBDC access models• No single platform for cross-border payments, reliant on
correspondent banks• Payment settlement is slow and carries FX risk
• Each central bank has their own set of regulations and autonomy
requirements

Wells Fargo Digital Cash
Intra-bank cross-border digital cash
solution in production
SOLUTION•

Allows Wells Fargo to complete internal book transfers of cross-border
payments within its global network•Digital Cash eliminates the reliance on SWIFT and correspondent banks•

Settlement without third partiesRESULTSRESULTS
Faster transfer time and reduced
costs and points of failure
Irreversible, real near-time
settlement and reconciliation

CHALLENGE•Internal book transfers between branches are overly-complex and slow•

SWIFT Payments only run 6-9 hours a day, 5 days a week, impacting
international payments experience for customers•

Transfers involve multiple parties and systems and carry high-risk, costand complexity

Expanded operating hours with
24x7 transactions

Opportunities across the digital asset
lifecycle
Improvements

Technological Innovations• Faster settlement, reducing
counterparty and credit risk

• Divide and digitize illiquid assets
such as commodities, real estateand private investments• More efficient securities issuance,servicing and redemption• Increased liquidity access• Global, 24x7 marketplace• Programmable, immutabletransactions• More diverse investor portfolios• Tokenization is rewriting securities
issuance to create efficiencies andreduce risk
• Leverage smart contracts andworkflows to trade frictionlessly• Built-in capability for progressive
distribution

DTCC
T+1 settlement acceleration platform
SOLUTIONRESULTSRESULTS• Corda underpins DTCC’s settlement acceleration platform which isoperating at scale• Reduces settlement times for U.S. Equities from two days post trade(T+2) to T+1• Potential to fully integrate into the U.S. clearance and settlement
processes

CHALLENGE•

U.S. Equity Market is demanding faster clearing and settlement
services•

Need to modernize settlement clearing processing and ensure theirrelevance in capital markets for years to come

Reduced settlement time toreduces counterparty, credit anddefault risk
Move to T+1 could reduce $13.4
billion held by its members inmargin each day by 41%
Impactful shift in how capital
markets operate

Digital Vault
Private placement securities solution
SOLUTIONRESULTSRESULTSGives investors real-time access to records of securities bought onprivate markets• Allows creation of a seamless workflow throughout the entire
lifecycle of private placements from months to days
• Corda chosen due to asset agnostic, scalability, privacy, and easeof auditing•

CHALLENGE

Margin under pressure due to heavy administration costs
associated with private placements operations• Held on paper, Lack of standardization, archaic and outdated
system• Investor access difficulties and inefficient causing significantdelays•$20B

Valued assets during launch
Cutting down administration
costs and delays from issuanceto participation$7.7T

Target market

New entrants are also building networks that banks and corporates can participate in

Trading ecosystem thatremoves barriers to finding,sharing and trading corporate
bonds

Digital trade network that allows
participants to create and manage
letters of credit transactions inreal-time

Digitizes precious metals andthe entire end-to-end value
chain from mining totransport to investment

Tokenizes securities (gov’t andcorporate bonds) at multiple
custodians and enables atomic
transfer of ownership

Smart bonds that automate the bondlifecycle from issuance to redemption
via smart contracts

Short-term lending platform
which brings together
institutional lenders andborrowers

Connect with R3
No matter where you are on your digital journey,
R3 can help
sales@r3.com
r3.com | corda.net

Thank you
r3.com | corda.net | conclave.net

New York
1155 Avenue of the Americas,
34th Floor,
New York, NY 10036

London2 London Wall Place,London, EC2Y 5AU

Dublin
3rd Floor Block 2 Harcourt Center
50/53 Harcourt Street
Dublin 2

Hong Kong
Bonham Strand, 7F Office 18-121
Hong Kong

Mumbai
01A108, WeWork Enam Samhav,C-20, G Block, Bandra Kurla Complex,
Mumbai, 400051, India

São PauloAv. Angélica, 2529
Bela Vista- 6th Floor
São Paulo - SP, 01227-200, Brazil

Singapore
18 Robinson Road, Level #14-02
Singapore, 048547

TokyoIzumi Garden Tower 19F,
1–6-1 Roppongi, Minato-ku,
Tokyo 106-6019, JAPANlinkedin.com/company/r3cev-llc@inside_r3

Appendix

Digital assets use cases: The path forward for FMIs
Settlement
Acceleration

Digital Asset Lifecycle
Management

Replace legacy technology withDLT to modernize trading,clearing and settlement.

Purpose built infrastructure toaccommodate post execution
lifecycle from "match to settle"
workflow through single mutualised
infrastructure

Enable issuance, movement andservicing of digital bonds, equities
and warrants. Privacy, integrity andauthenticity of data processed andmanaged on a Corda ledger ispreserved throughout its entire
lifecycle.

FoundationalImprovement

Ecosystem
Improvement

Product
Innovation

Digital Market Infrastructures

Rising interest in fiat-backed stablecoins from banks and FMIs
Fiat-backed
Stablecoin
ModelsIntra-Bank Transfers

Embedded Finance

Crossborder BookTransfers

Stablecoin-as-aservice for corporate
customers

Bank + Retail Ecosystem

Inter-Bank/FMI

Retail loyalty tokens
across merchantnetwork

Inter-FI/FMI
settlement

ExampleUse Cases

How R3can help

Enabled by Corda + Stablecoin Accelerator + Professional Services Engagement