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Finance in the Age of Web3: On the field or sideline?

Authors

2 minute read 26 Apr 2024

In the world of Web3, the finance function – and treasury in particular – plays a vital role in navigating new revenue streams.

In brief

  • What is the current position of the Finance organization in Switzerland regarding the adoption of Web3 applications within the company?
  • How does the integration of Web3 applications as a new revenue model impact the operations of your Finance department?
  • How should the Finance organization be engaged - on the field or on the sideline?

As Web3 applications increasingly become integrated in our lives, especially among the younger generations, companies are poised to benefit from numerous revenue-generating opportunities.

While CFOs recognize the importance of the finance function – and above all treasury – in managing the next evolutionary phase of the internet, a Swiss market study by EY in cooperation with HSLU found that less than 10% of Swiss corporates feel ready for the Web3 revolution.

How EY can help

Web3 applications, such as tokenization of real-world and virtual assets and decentralized finance, impact the finance function in more ways than might initially be apparent. In the world of Web3, players need to ensure effective management of crypto assets, risk management, assessment of price volatility and timely conversion of cryptocurrencies into fiat currencies and vice versa. A skilled and knowledgeable treasury team can support effective execution of these tasks and also capitalize on Web3 by driving efficiencies and revenues through staking and decentralized exchanges.

 

Although Web3 offers exciting opportunities, there are also challenges, including storage solutions and regulatory compliance. Organizations must navigate evolving regulatory landscapes and align with authorities like the US Securities and Exchange Commission (SEC) and the Swiss Financial Market Supervisory Authority (FINMA). By adopting a comprehensive and proactive approach to regulatory compliance, organizations can futureproof their organization, capitalize on new revenue streams and minimize legal risks.

 

Our report showcases key insights from industry peers and practical considerations on how finance departments, especially Treasury, could be involved in corporate Web3 initiatives. Learn more:

Finance in the Age of Web3

Download the paper and discover how finance experts rethink their roles and become strategic allies for the success of Web3.

Download
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Summary

Currently, Web3 initiatives are predominantly driven by business, with finance rarely taking the lead in these projects. Against the background of growing integration and expectations of long-term growth in this space, we encourage finance professionals to examine their roles and solidify their position as strategic partners that support successful Web3 initiatives.

Acknowledgements

We thank Tobias Schaffner, Mascha Steenblock, Orkan Sahin, Maxime Ochrymowicz and Thomas K. Birrer (Professor of Corporate Finance, HSLU) for their valuable contribution to this article.

About this article

Authors

Related topics
Assurance
Finance
Blockchain
Digital
Technology

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    EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Limited, each of which is a separate legal entity. Ernst & Young Limited is a Swiss company with registered seats in Switzerland providing services to clients in Switzerland.