It has been an eventful decade for the fintech markets. The fintech industry comprises of technology-based businesses that cater to or compete against financial firms. The advancement of the internet and a willingness by companies to invest in its development, means that nearly 70% of the world’s adult population have a bank account with online or mobile capabilities.
Meanwhile, whilst being one of the fastest growing sectors in the world, the fintech industry is attracting record levels of investment. In 2008, investment into fintech equaled $100 million. By 2015, investment levels had risen to $19 billion. According to KMPG, global fintech funding topped $31 billion.
Having boomed in the internet years, fintech is set to boom further with the advent of blockchain technology. Blockchain is a digital ledger in which transactions made in cryptocurrencies such as Bitcoin, are recorded chronologically and publicly. The technology behind blockchain enables quicker transactions and a reduced cost, something the big banks have wisely chosen not to ignore. The biggest names in banking are delving more and more into the crypto world. Recently Japanese giant SBI went live with VCTRADE, their own crypto exchange.
Blockchain is influencing our trading as well as our banking. Now, trading platforms such as spectre.ai make it possible to trade fiat currencies (traditional money) with crypto currencies and commodities. The broker-less platform uses smart contracts, something big institutions such as JPMorgan are researching.
The possibilities that blockchain offers the fintech industry are seemingly endless. Everything appears to be moving at great speed, with announcement of developments and partnerships occurring on a daily basis. It’s possible to get a financial technology rating through some websites which help to navigate the wave of fintech blockchain advancements, but still, keeping up with developments is a problem as it is all moving so fast.
The fintech industry is changing, fueled by the limitless blockchain technology. From internet banking, online trading and mobile payments, to blockchain technology and the crypto world, the changes are changing our banking and payment habits forever. How long before we all bank our cryptos in blockchain banks, remains to be seen. There are still heavy questions over security. Hacking has been a big problem in the crypto world. Despite all the investment and all the ever growing popularity, the threat of hacking looms over most blockchain based fintech projects and that is something that must be solved in order for the boom to continue.