Yesterday KPMG unveiled Chain Fusion, a solution to enable financial service companies and fintech to aggregate blockchain based and traditional data for digital assets to run analytics. The solution is intended to deal with the whole array of assets from Bitcoin and stable coins to central bank digital currencies (CBDC).
The visual above gives a good idea of the gulf in architecture between traditional and digital asset systems. Hence amalgamating the data from both types of platforms is a non trivial matter.
The solution uses a structured data model for digital assets or cryptoassets so that analytics can be run for typical purposes such as business analysis, risk assessment and compliance, including anti money laundering (AML).
“Regulators and auditors expect fully implemented controls and processes within and across a cryptoasset business – whether they are cryptoasset or traditional systems or anything in between,” said Sam Wyner, director and co-lead of KPMG Cryptoasset Services team. “If you are a blockchain or digital asset based business, you will have separate systems for everything.”
The solution also helps with verifying custody of crypto assets with cryptographic proofs as well multi-party computational cryptoasset wallets. Additionally, it provides transaction monitoring for AML.
“Leading cryptoasset technology solutions can address process and control requirements within their own systems, but the greater challenge is making sure systems can work together, with all the right processes and controls in place between those systems,” said Wyner. He also highlighted the variety of systems from permissioned to permissionless blockchains and then the traditional front, middle, and back office systems.
KPMG first published a report on the institutionalization of digital assets 18 months ago. Since then, it’s been involved in an array of projects. But perhaps it is most closely identified with blockchain loyalty solutions following an early initiative with Singapore airlines, and more recently launched a blockchain supply chain platform.