Why should Financial Institutions use Marlowe and Cardano?
What defines a financial contract ?
Why is it better to run them OnChain?
Lets take the “escrow” as an example.
Just trying to fully understand the product 
Hey @Pierre_Pt so a little bit of my personal experience, but i need to say im not so deep into the technical thing and this developer area isnt the space for me.
Why should Financial Institutions use Marlowe and Cardano?:
Marlowe is an Smart-Contract Builder where you can build this natively on the blockchain. In my opinion this isnt for financial institutions, its more for the regular business and end users.
Actual if a business want to offer complex financial instruments they need to do this over their bank. For example:
If a company want to offer shares and want to be listet on an exchange they do this over their bank.
If a company want to offer an corporate bond they do this over their bank.
If two people want to trade an property they do this with contracts or in germany even over an notary public which acts as an Trustee.
So the problem here is that this companys need to trust and also pay an third party. With Marlowe and Cardano they can offer and build this financial instruments by themself.
What defines a financial contract?
In the world of finances a financial contract is the same as a financial instrument. If you know shares, bonds or certificates which are traded on an exchange you know what it is. A simple example:
With a share, you get ownerrights and dividends from the company in exchange for capital. And there can happen so much things that normal transactioncs cant show.
So you can say that a financial contract is everything where more happens that only a transaction for something. As example: You exchange rights for money over a certain time that starts at the point where Ada rise over 2 US$ but this need to happen right before Cardano post an “Hello” under this post.
Why is it better to rum them OnChain?
There my knowlegde ends sorry.
I hope i could help you a little bit.
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Hey @Jonny22 thank you so much for your answer. It helpped me alot !
What do you mean with that ?
Greetings from Germany
I mean with this that a financial contract can transfer things that a normal transaction cant.
As an example:
You want to build an house,
10% at the beginning
40% at the time where they build it
50% when they finished it
So with normal transactions you only pay
But with an smart contract you can write this as code that run by itself. The code is your trustee, it is your third party and so on.
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@Jonny22 Thank you for your very clear answer. I hadn’t fully understood the main purpose of Marlowe.
I am currently learning about financial instruments from this course by My Trading Skills: Financial Instruments Explained - Complete Trading Course - YouTube
Hey @brandiqa
Marlowe in fact is the coding language for smart contracts. This language is getting used because:
- Smart Contracts are just a little script that picture complex financial instruments
- financial experts cant code
- coder are no financial experts
That a business, an NGO or something else can offer smart contracts by themself they have Marlowe.
The main purpose is to code Smart Contracts in an financial language and not in C# or so… The company isn`t supposed to hire an extra coding expert, they can read, write and run this by themself.
If you want to read some Marlowe code or even prototype an idea, you can use the Marlowe Playground.
There are to types of “using” it: you can clearly write in Marlowe or you use the “Blocksystem” which is like a “lego block system”. If you are already an coding expert you can Haskell or JavaScript and convert them into Marlowe.
Even though Marlowe has made it much more simpler to create smart contracts, there is still quite a bit of learning curve. I believe at this stage most businesses would still prefer hiring a specialist to build for them Marlowe smart contracts especially since they are used to having banks setup the financial instruments for them.
It’s like accounting. Even though many business owners can do it themselves, they still need to hire accountants so that they can focus on other areas of the business.
I have a background in JavaScript. Am currently learning Haskell. Hoping to come across opportunities in this space.