MSc in Finance students discover “the next frontier”

“In a post-financial crisis world, cryptocurrencies are becoming a credible option for developed countries and an interesting alternative for developing nations”, observes Jean-Pascal Brivady, Professor of Corporate Finance at emlyon business school and one of the brains behind the seminar. “In its infancy this form of currency was used mainly in China and the USA, but the trend is starting to manifest itself in the EU, Japan, and economies such as Nicaragua”. In light of this changing landscape, the companies Binance, XAnge (the innovation and digital investment branch of Siparex group), and KPMG convened along with the Economic Head of Europlace at the Maison de la Chimie in Paris for an intensive program of presentations and workshops designed to share and test their vision on the role of digital assets (including cryptocurrencies) and the challenges it poses to more traditional business approaches.

Students were given an overview of the current state of play by Europlace, including related projects on which central banks are working at present. The floor was then given to a series of conferences. Binance shared their vision of the market before then espousing their view of the role played by transaction platforms. It was then the turn of XAnge to share fundraising best practices in the digital asset context, as well as their vison of the market from a virtual currency fund perspective. The specialist Blockchain & Crypto team from KPMG then got into the nitty-gritty of how this new currency trend can be used in the professional sphere. For participating KPMG Blockchain & Crypto Supervisor Grégoire Rey, there is every reason to be confident: “despite the unfavorable market conditions in 2022, the level of interest from businesses and institutions grew massively, as evidenced by the Web3 entrance of some of the top global brands across all industries. This is just the beginning and I expect further adoption from both the retail and institutional sectors in 2023.”. To back up this positive outlook on a formerly embryonic sector, time was also dedicated to identifying the potential client profile and the consequences for consulting.

Given the skepticism in some economies, particular attention was paid to how this new form of currency can be used securely, as noted a participating student of the Corporate Finance and Innovation track of the MSc: “we learned about the kind of conditions being created for mass adoption of cryptocurrencies - centralized exchanges (CEX) like Binance play a crucial role in the mass adoption of cryptocurrencies by providing a convenient and user-friendly platform for individuals to buy, sell, and trade various digital assets. Additionally, CEXs like Binance often have strong security measures to protect users' assets and information, which can help build trust in the industry”.

The corporate perspective given by the participating companies and the understanding that the emlyon students were gaining were then put into practice via an extended workshop session on the second day. The group was divided into two batches, depending on their respective specializations (Corporate Finance on the one hand and Market Finance on the other hand) and their programming abilities. Groups of up to five students then worked on a historical database linked to a crypto currency basket, examining pricing, behavior and the proposal of a portfolio + investment strategy. One batch worked on the basis of an Excel template, the second on a jupyter notebook. Presentations and recommendations were then given to all in attendance.

The seminar was the first of its kind for the MSc in Finance program so it was especially fitting for it to be dedicated to so new a business practice, as underlined by Jean-Pascal Brivady: “this event was the first of its kind due to the development of the cryptocurrency phenomenon and relative lack of regulation. The sector is in its embryonic stages with little formal professional use, for now. In a sense, by organizing this event, we have opened our students' eyes to the new frontier of Finance”. Mindful of the current landscape and attitudes to the trend, attention was paid to providing an economic overview of the ecosystem, the regulations in place, and current professional usage. By then setting up workshops for the students, due time was dedicated to the kind of strategic and forecasting work that the students will most likely need to master once in business, post-graduation. For a student of the MSc's Market and Quantitative Finance track, the benefits of the seminar were plain to see, even serving to reassure the perspective he had on cryptocurrencies before the event: “it was a really interesting conference because it enabled me to meet experts of the industry and really inspired me with the idea that crypto does have a role to play in the future of finance. I think I might even consider the industry as a possible future career path if an opportunity presents itself, as opposed to my scepticism about the industry that was present before the conference took place. Crypto literacy is real”.