LCX CEO Monty Metzger Literally Wrote the Book on Blockchain Banking
Monty Metzger is the CEO of enterprise blockchain consultancy LCX, based in the country of Liechtenstein, where many of the nation's regulations regarding blockchain are already in place (creating some certainty with respect to the legal operating conditions for companies like his). Blockchain Banking, the book that Metzger recently published is about how the balance of innovation, regulation, and everyday life will change due to digital currency. In the interview with Blockchain Journal editor-in-chief David Berlind, Metzger that he has been heavily engaged with the World Economic Forum and several central banks as they experiment with the idea of Central Bank Digital Currencies and, based on his experience, tells us that many banks have a keen understanding of blockchain as well as how CBDCs might impact their currency strategies longer term (full-text transcript appears below).
By David BerlindPublished:January 16, 2023
If banks cannot beat blockchain, they will have to join it to survive
David Berlind: Monty Metzger, CEO of LCX, you're here in Davos, Switzerland for World Economic Forum. Thanks for joining us on Blockchain Journal.
Monty Metzger: Thanks for having me.
Berlind: Okay. Lichtenstein sounds like one of the few countries that has regulations in place. You found a way to operate your company using blockchain technology in a way that complies with those regulations?
Metzger: That's right. We moved to Lichtenstein particularly to found a company 2017 and then we incorporated 2018. And since then, we acquired nine registrations according to the Blockchain Act in Liechtenstein, which is not only regulating one piece of the puzzle, but a whole value chain of blockchain and crypto. There we are starting as a new, I would say, next generation of crypto exchange and a new category leader for the future of blockchain finance.
Berlind: Okay. You're holding a book in your hand. And I just want to, let's show the book to the camera there. And you are the author of this book, it's called Blockchain Banking. What is this book about?
Metzger: The Blockchain Banking is about the future of money and finance. It's all about a balance between innovation, regulation, and how our future of everyday lives will change due to digital money.
But it's also covering the balance between the revolution, the people who think money should be freed up from the state. And on the other side, we see development where central banks totally want to get control over every digital money with central bank digital currencies.
I'm explaining what the key terms are, but then also giving out seven leadership rules for every manager and CEO who are here at the World Economic Forum to understand what will be the future of digital money look like.
David: You mentioned Central Bank Digital Currencies, or also called CBDCs. Do you help any institutions or banks figure out their CBDC strategy?
Metzger: That's right. We had been a member at the World Economic Forum for several years, and we also hosted workshops together with central banks. One workshop was, for example, with 15 central banks. And I can tell you they all have deep, deep knowledge and understanding about what cryptocurrencies are, what blockchain is. And over 100 central banks are currently experimenting or even launching, preparing to launch a central bank digital currency.
Berlind: I have a good question. Why or to what extent do you think some of those central banks are willing to put some digital currency, a central bank currency for some sovereign country on a public blockchain? Because most of what I've heard is if they're going to put it on a blockchain, it's going to be private.
Metzger: Right. That's a big discussion on which technology will be based. Some are working with permission-based blockchains, some are thinking about open blockchains as well. And you also see talking about money, it's ultimately talking about power, serenity, state and the power of a central bank.
And what we see in open cryptocurrencies, Bitcoin for example, it is undermining these powers and is a war of currencies being happening. And what we can now see is that some central banks are stepping up the game earlier than others.
We've seen China introducing the central bank digital currency only. There's Europe with the digital Europe being planned, the digital dollar by the Fed in the US. A lot of movement being there. And it's not a matter of if, but just a matter of when it will come out.
Berlind: Just a question of when. Pretty soon, our fiat currency will be all digital, maybe a lot less paper. In terms of what LCX does, do you also help large enterprises with their plans to use Blockchain as some sort of application platform? For example, customer engagement or disruption within their industry?
Metzger: For us, the key topic is how do we grow SLTX for this year? One of the key topics for us is tokenization. We launch a diamond platform for tokenization. We're launching a tokenized bonds of financial instruments, which will be tokenized.
And we are, as a regulated platform, really trying to evolve the industry as a whole. Now with the book, Blockchain Banking, we are launching it at Davos event here at the World Economic Forum. And really trying to get more interest of institutions, letting them, getting them an understanding of what the future might hold.
And there's a famous saying from Bill Gates who said, "Banking is needed, but banks are not." And that's where we stand.
Berlind: Pretty bold statement.
Metzger: Right. And that's where we stand. It's a shift of power. A lot of banking services could be fully decentralized without any intermediaries. At the same time, we do see with the disaster of FTX, for example, that regulation is needed if human people are involved because fraud can happen. That's why I truly believe in decentralized finance. And how could that evolve and merge for the future finance and in crypto.
Berlind: Okay. Well, Monty Metzger, CEO of LCX, author of Blockchain Banking. Thank you very much for joining Blockchain Journal here at World Economic Forum in Davos.
Metzger: Thanks, David. So great.