Headline Verdana Bold Blockchain – Art of the Possible Responsible : Building an Art Market 2.0 2 February 2018 Blockchain Overview Blockchain is a distributed and immutable digital ledger, recording transactions and tracking digital assets in real time

Decentralised and Distributed Irreversible and Immutable Real-time & Secure Blockchain is a public record of all Blockchain enables two primary Conduct secure transactions through transactions which is managed and parties transact, eliminating the third cryptography which can be verified shared on all nodes and can be party verification completely and settled in minutes as opposed viewed by everyone to days

Implications

Evolving role of institutions as trust Disrupt business models focused on Shift in customers expectations as is decentralised extracting value when a transfer in competitors set the standard of value between parties occurs faster service

Deloitte 2018 2 Blockchain – How does it work? Each transaction issued on the Blockchain is confirmed by validating nodes (blockchain users) through network agreement and written immutably to timestamped blocks

Blockchain Transaction Broadcasting Consensus Recording The Blockchain ledger A transaction is submitted The requested transaction The validating nodes on the Verified transaction is contains a chain of for addition to the is broadcast to all nodes in network validate the permanently embedded to timestamped blocks blockchain containing the the network and queued for transaction using the existing Blockchain in a containing a batch of public key address of the validation. cryptographic algorithms to timestamped block. transactions, and each recipient, the value to be reach consensus. block contains a reference transferred, etc. to the previous block in the chain.

Deloitte 2018 3 Art Theft How can you safeguard an irreplaceable art piece during transit

We have all seen those movies that the plot line is about art thieves…

However, this is a real life issue: February 2008 – Interpol: Four masterpieces stolen from Zurich museum valued at $163 Million

According to ACE Private Risk Services 2013- 2014 Art Valuables Claims Data about one in five claims (18%) involved a loss that occurred while the artwork was in transit, often considered a leading cause of damage to

Image Source: http://www.gstatic.com/tv/thumb/movieposters/23020/p23020_p_v8_ai.jpg

Deloitte 2018 4 The Deloitte ArtTracktive proof of concept Deloitte develops blockchain proof of concept to solve traceability issues in art

Read the press release

Watch the video

Deloitte 2018 5 Blockchain and the art of the possible Blockchain is already making an impact on the and can continue to enable and transform the business

Buy & Sell Protect

Auctions Tokenise fine art Copyrights Insurance

Art Coins Art as collateral Pedigree Authentication

Sample companies

Deloitte 2018 6 Illustrative Blockchain and the art of the possible Examples

Image Source: https://raredigitalartfestival.splashthat.com Image: Jessica Klein

13 January 2018 Live Auction on First Rare Digital Art Festival in the Blockchain New York City

Deloitte 2018 7 World of Cryptocurrencies The following map created by Thompson Reuters provides a snapshot of the world’s view of Cryptocurrencies

Global Advocates Pioneer nations whose governments have taken steps to promote cryptocurrencies and drive parity for virtual currencies. Developing Nations that are progressing toward equal status for virtual currency, but there are still some barriers. Fence-Sitters Governments that have not called individual trading into question or that have stopped short of giving any legal or regulatory protection to users of cryptocurrency. Hostile Governments that have taken steps to curtail virtual currencies, but stopped short of banning individuals from trading or exchanges operating with cryptocurrencies. Banned Nations that have outlawed crypto- currencies within their boarders, some of which threaten punitive sanctions to individuals caught using them.

Source: Thompson Reuters

Deloitte 2018 8 Deloitte Blockchain Offering

Strategy Development 2

1 Innovation and Ideation . We lead you to define “where to play and how to win” . We identify relevant use cases to harvest the . We drive business, technology, integration and benefits of blockchain technologies talent strategy . Our thought leadership, developed in . We develop strategies to pilot and implement conjunction with our ecosystem of innovation blockchain based solutions and blockchain companies, enables you to make sense of the broad innovation landscape . We define an iterative and flexible approach to match the rapid changes in the ecosystem . We track over 200 blockchain companies

Prototyping 3

4 Product Development . We accelerate prototyping by using our existing technology capabilities and industry . We mobilize our global practitioners to your experience organisation to re-engineer business . We have prototypes up and running: Digital processes or design new ones Bank, Loyalty & Rewards and Smart Identity . We bring our broad set of services, across . We have over 20 prototypes in development compliance, technology, talent, operations and tax, to effectively integrate your blockchain solution . We deliver as one team in collaboration with external companies 23 700+

Industries where we have Global delivery network Practitioners in our Ecosystem of technology and deep business process with 9 development teams blockchain community from knowledge 40 countries innovation companies Deloitte 2018 9 Thank you!

Adriano Picinati di Torcello Marco Grossi Meg Alderman Director, Deloitte Luxembourg Director, Deloitte AG Senior Consultant, Deloitte SA Global Art & Finance Coordinator +41 58 279 7404 | +41 79 703 6552 +35 2621230057 [email protected] [email protected] [email protected] • Art enthusiast • Blockchain enthusiast - passionate about • Initiated Art & Finance activities at the solving problems in the digital age and group level • Blockchain expert, mainly on business side managing risk driven by disruption, • In charge of the Deloitte Art & Finance innovation and change Conference and Art & Finance report • ICO and Cryptocurrency market specialist • Hobby ceramicist – 10 years • Bridge Art, Finance, Business, Culture • Financial investment specialist

Deloitte 2018 10 Deloitte Points of View

5th Art & Finance 2017 Art & Finance Tax Services - Your The Blockchain (R)evolution- The When two chain combine – Art-related services have become an art, our tools Swiss Perspective supply chain meets blockchain integral part of wealth management The global art market is Blockchain technology is very much a In an increasingly digitized world, services. Find out what wealth transforming, creating new trending topic, and Deloitte emerging technologies, such as managers, art collectors and art opportunities. Deloitte Luxembourg Switzerland is pleased to be able to blockchain, afford organisations the professionals around the globe think offers a wide array of art-related give you an insight into it with this opportunity to drive business value about the art market and the role services to address clients’ needs on publication. We herein focus on how throughout their supply networks. they play in it in Deloitte a worldwide basis. Interested? Find Blockchain is seen by the Swiss We now have safer and more Luxembourg's and ArtTactic's recent more here with our dedicated market, which offers the Blockchain efficient ways to connect with Art & Finance report. brochure. community huge potential as a place business partners as well as to track in which this technology can be and exchange any type of asset. The developed and used, of which the ability to deploy blockchain www.deloitte-artandfinance.com prominence of Zug’s Crypto Valley technologies to create the next provides the most convincing generation of digital supply chain evidence. Find our more here with networks and platforms will be a key our point of view. element in business success. Find our more here with our point of view.

Deloitte 2018 11 This publication has been written in general terms and we recommend that you obtain professional advice before acting or refraining from action on any of the contents of this publication.

Deloitte Consulting AG accepts no liability for any loss occasioned to any person acting or refraining from action as a result of any material in this publication. Deloitte Consulting AG is an affiliate of Deloitte NWE LLP, a member firm of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”). DTTL and each of its member firms are legally separate and independent entities. DTTL and Deloitte NWE LLP do not provide services to clients. Please see www.deloitte.com/ch/about to learn more about our global network of member firms.© 2018

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