“We realized that we needed to test it ourselves.”
When reading up on blockchain tech and attending conferences proved insufficient, Quebec’s financial regulator, Autorité des marchés financiers (AMF), decided to take the next step in its quest to better understand distributed ledgers.
To that end, the AMF announced last week that it had joined the R3 blockchain consortium and created a fintech lab to advance its response to new technologies.
The AMF describes the newly established lab as a think tank that will improve its understanding of emerging technologies like the blockchain, both for internal use and for the review of regulations.
As part of the deal, the regulator signed up with the R3 consortium, a group of more than 80 financial institutions developing blockchain applications for the finance sector, and that is increasingly eyeing work with regulators.
For now, it will explore how AMF can improve its ability to carry out its mandate and how blockchain uses cases, like KYC (‘know your customer’) processes, can be executed, according to Lise-Estelle Brault, senior director derivatives oversight at the AMF.
Brault told CoinDesk:
“We need to build internal knowledge to have a critical eye and really understand these different use cases.”
Despite recent exits from the consortium, R3 representatives lauded the news as evidence its appeal continues to broaden.
“We’ll be doing proofs-of-concept and use cases in the lab that would appeal, not just to AMF, but the other members in the public sector that they attract as well,” said Charley Cooper, a managing director at R3.
Yet, Brault stressed that the AMF’s lab is in its early stages and isn’t committing to any permanent blockchain projects.
“Other regulators and central banks are facing challenges that are similar to ours, so we are interested in joining that conversation,” she remarked, adding that working face-to-face with these institutions was the biggest draw.
Further, blockchain and distributed ledgers are just part of a much wider remit for the lab, she added. One of the first projects it will be tackling is using artificial intelligence to manage regulatory data.
The AMF will now work with academia to help with research projects focused on new technology use cases. The lab plans to hire two university students, in the engineering and technology fields, as interns later in May.
Correction: An earlier version of this article displayed an incorrect AMF logo. This has been updated.
Image via the AMF