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Noumena Digital AG Leads Innovation in Regulated Stablecoins and Decentralized Enterprise Software

CEO Juerg Kaeppeli on pioneering digital automation and secure stablecoin transactions
By Gresheen Libby
June 1, 2024

In an exclusive interview, Juerg Kaeppeli, CEO of NOUMENA Digital AG, explores how the Swiss-based company is at the forefront of digitalizing and automating complex multiparty operations.

NOUMENA Digital AG leverages advanced protocol-based technology to enable decentralized, secure, and scalable enterprise solutions. Kaeppeli discusses the company's innovative approach to integrating regulated stablecoins, ensuring secure and seamless transactions within multiparty ecosystems. He also highlights NOUMENA's capabilities in enhancing enterprise systems, driving efficiency, and fostering broader adoption of blockchain-based digital assets.

Gresheen (GG) Libby: Can you explain the core technology behind NOUMENA and how it enables the digitalization and automation of complex multiparty operations?

Juerg Kaeppeli: NOUMENA's technology represents the most advanced protocol-based approach to software development. Our platform combines the benefits of a high degree of automation in writing, debugging, deploying, and operating software, elevating user centricity as a core design principle and allowing for a decentralized architecture. We achieve all of this while ensuring enterprise-grade security and scalability. At its core are the NOUMENA Protocols, which are analogous to smart contracts on the blockchain. They contain the data and business rules tying together the interactions between multiple parties. However, at NOUMENA, we do not rely on blockchain infrastructure to compute and persist these protocols. Instead, we build on a more traditional network of NOUMENA engines, which represent independent nodes that are cleverly tied together through messaging. This approach enables the sought-after network effects without compromising security, performance, or privacy.

The NOUMENA Engine is the key component of our technology, handling most of the heavy lifting. It processes protocol instructions, authorizes parties, and cross-references other protocols, thereby moving the system from one state to another in a deterministic fashion. The Engine is part of NOUMENA’s runtime environment, which also automates all non-functional software requirements, including logging, access control, error handling, persistence, transactionality, and performance monitoring. Compared to traditional IT architectures, NOUMENA’s protocol approach combines the application layer, domain layer, and large parts of the infrastructure layer, significantly reducing the development cycle, accelerating time to market, and decreasing effort to market.

Gresheen (GG) Libby: NOUMENA aims to build next-generation distributed enterprise software. How does your platform integrate with existing enterprise systems?

Juerg Kaeppeli: Systems built on NOUMENA technology can integrate across network boundaries due to its inherent multi-node capabilities. This is achieved through an advanced asynchronous messaging system supported by the automated generation of APIs (application programming interfaces).

These autogenerated APIs are not only used to connect multiple NOUMENA nodes—they can also be leveraged to integrate with traditional front- and backends or other services within an existing IT landscape, such as ERP or CRM solutions or full SAP and core banking systems. To further simplify interactions with enterprise systems, particularly concerning accurate data model mapping, our team has developed a set of tools based on generative artificial intelligence (AI), significantly expediting integration efforts.

Additionally, NOUMENA technology can support any type of identity and access management (IAM) system, whether local or federated. Finally, business analysts can read NOUMENA protocols to verify and validate the implemented business processes. We offer various tools to streamline this process, including several fine-tuned large language models (LLMs) specifically designed to support business analysts and developers. These AI tools are most easily combined with our PaaS offerings on various cloud providers.

Gresheen (GG) Libby: What are the key benefits for businesses adopting your technology?

Juerg Kaeppeli: Speed and efficiency, versatility, and decentralization.
NOUMENA technology enables faster and simpler development of secure and scalable applications compared to traditional approaches. Once live, the NOUMENA applications are also easier to maintain because we have integrated all the required components for efficient operations and maintenance.

Then, our technology, while following simple design patterns, provides businesses with a lot of flexibility since it allows clients to bridge traditional, monolithic enterprise systems and decentralized business ecosystems. It can be used as an orchestration technology to connect disjointed, monolithic Web 2 services or as a gateway technology to connect Web 2 systems with Web3 and IoT.

Finally, due to its native multi-node capabilities, NOUMENA technology is well-suited to serve as the foundation for the next generation of decentralized enterprise systems, even in highly regulated sectors such as financial services and energy. In these applications, the NOUMENA protocol-to-protocol messaging technology pragmatically but safely balances the need for centralized governance with decentralized computation and storage.

Gresheen (GG) Libby: Stablecoins are gaining traction as a reliable form of digital currency. How does NOUMENA build regulated stablecoins on its platform and ensure secure and seamless transactions between multiple parties?

Juerg Kaeppeli: For stablecoins, NOUMENA builds on the decentralized capabilities of the underlying blockchain, like Ethereum or other layer-1 systems.

As mentioned above, for these use cases, the NOUMENA technology functions as a workflow scheduler for the centralized governance and processes involved with these digital assets and currencies, such as KYC, on- and off-ramp processes, and treasury management. It also implements the bridging requirements that allow for the secure interoperability between different layer-1 blockchains. Additionally, NOUMENA’s protocol approach can serve more fundamentally as the foundation to build tokenized money ledger systems requiring more centralized governance, such as CBDCs.

Gresheen (GG) Libby: Given the volatility of cryptocurrencies, stablecoins offer stability. Can you discuss how NOUMENA ensures the security and reliability of regulated stablecoin transactions within its ecosystem?

Juerg Kaeppeli: This question has multiple aspects. We could break it down by looking at the elements of security and reliability concerning on-chain and off-chain considerations.

First, a stablecoin's security and reliability as a digital currency primarily relies on the on-chain stability and decentrality of the blockchain infrastructure itself and the security of the smart contract that defines the stablecoin. If the smart contract has a flaw, it's hackable and, therefore, insecure. If the blockchain itself is unstable or too centralized, trust in the stablecoin will be compromised.

Second, trust in a stablecoin also requires off-chain security and reliability for the core processes involved, such as issuing, redeeming, or bridging stablecoins. This is the responsibility of the stablecoin issuer in two ways: first, by maintaining adequate reserves to back the stablecoin, supported by regular attestations from a trustworthy third-party auditor; second, by preventing fraudulent activity and ensuring compliance with regulations for all transactions. Using the NOUMENA technology, we can ensure these requirements natively.

Gresheen (GG) Libby: Interoperability is only one of the prerequisites for driving broader adoption of blockchain-based digital ecosystems. What is NOUMENA’s view on this and how does NOUMENA support clients to drive further adoption?

Juerg Kaeppeli: In order for users to adopt Web3 technology more broadly, a number of challenges need to be addressed. One important challenge is simplifying the user experience for non-crypto natives. Another one is to provide a cheap and scalable infrastructure for business transactions across blockchain ecosystems.

For example, an average user holding a digital euro issued on Ethereum will expect to be able to use that same digital euro on other blockchain ecosystems without having to understand the details of how to use specialized bridging solutions. Furthermore, such bridging solutions must be extremely safe, which, historically, often hasn’t been the case – to date, attacks on bridges have resulted in $2.8 billion in stolen funds.

Likewise, wallet applications required for Web3 purposes still don’t offer the same ease of use as traditional wallet apps do. For mobile wallet apps, for instance, part of these challenges are due to actual hardware limitations (different incompatible encryption methodologies are used). Another example is the ability to offer users the option of gasless transactions. While progress can be made – for example by using Account Abstraction for Ethereum – such approaches are still relatively new.

Finally, the wider adoption of digital assets, like real-world asset (RWA) tokens and stablecoins, will require a broader set of regulatory requirements to be implemented, such as allow-listing and blocklisting of accounts across multiple blockchain ecosystems.

In summary, to achieve broader real-world Web3 adoption, trusted ecosystem players need to provide services enabling users to access regulated Web3 offerings in a more seamless and secure way. From a technological perspective, these are exactly the challenges that can be addressed by NOUMENA technology. Our protocol-based approach allows engineers to implement solutions that combine off-chain processes and controls with on-chain smart contract logic in a consistent and secure way.

Gresheen (GG) Libby: How does NOUMENA tech support clients to ensure regulatory compliance?

Juerg Kaeppeli: Many regulatory compliance processes rely on off-chain procedures. For instance, for users to receive regulated digital assets, they must undergo KYC, which is one of many off-chain processes required. NOUMENA technology is designed to formalize and digitize such compliance and control processes in a user-centric way and ensure this information is properly reflected and processed on-chain. By using NOUMENA, such requirements can be implemented more efficiently and securely.

Gresheen (GG) Libby: Looking to the future, what innovations or advancements do you foresee in the intersection of distributed enterprise software and stablecoin technology, and how is NOUMENA positioning itself to lead in this space?

Juerg Kaeppeli: We believe in the benefits of a decentralized Web3 approach for certain aspects and use cases. We also recognize that certain key processes will remain off-chain. However, these should be managed more transparently and decentralized for the users involved.

This is what NOUMENA technology can deliver: it enables secure, scalable, and privacy-preserving process execution involving multiple parties on one or multiple connected nodes. This approach is crucial now as we are building solutions to bridge between the Web2 and Web3 world. They become even more important when bootstrapping the next generation of true real-world ecosystems that result from connecting decentralized digital or data assets with decentral verifiable claims concepts and programmatic settlement methods such as regulated stablecoins. We are working on many such use cases with our clients across finance, energy, telecom, and logistics. We believe we are just starting to scratch the surface of possibilities emerging from these new approaches to digitalization.

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