Finance and technology (Fintech). The next big thing?
What is financial technology or (Fintech).
The short answer is that fintech is any new technology that upgrades and improves the delivery of financial services.
The long answer is far more complicated than that as long answers always are.
You could take fintech as a simple upgrade on existing services thanks to the improvement in computers and digital systems but fintech permeates every part of our daily lives now as computers are our personal assistants.
At its core, fintech is utilized to help companies, business owners, and consumers better manage their financial operations, processes, and lives. It is composed of specialized software and algorithms that are used on computers and smartphones. Fintech, the word, is a shortened combination of “financial technology.”
Our lives, our online activity and our finances are now so intrinsically linked that fintech is everything. It's our banks, our phones, our lives.
They are all tied together through the internet of things. This is another funny term that is used to describe how the internet has permeated every part of our lives now.
Our lives and everything in them is part of a digital world.
Billions of networked 'smart' physical objects around the world, on city streets, in homes and hospitals, are constantly collecting and sharing data across the internet, giving them a level of digital intelligence and autonomy.
The digital transformation that is taking place due to emerging technologies, including robotics, the IoT and artificial intelligence, is known as the Fourth Industrial Revolution
We shop online, live online, our data is online. Your phone, your fitbit, your household appliances. All linked to the internet and the systems behind it. This is the internet of things and it is a big part of fintech moving forward.
When people hear of financial technology, they hear banks.
But from my experience, you can now get paid to an account on your phone, shop on that phone, pay through your phone for physical goods, operate your thermostat through that phone and be tracked through the same phone. This is the fintech that will affect the most people. Real world activity tied to your personal finances, controlled though your own digital device.
The banks obviously have their own uses for new technology but the masses will be more concerned by how their lives can be made easier.
What we have above is the latest iteration of fintech. The move from bricks and mortar banks to a personal banking experience.
It has happened over the past decade and made a lot of existing services obsolete and cost prohibitive.
Web3 is going to make it fun. We have seen from our experiences on Hive how social media and online activity can be tied to your earnings. We also have seen through cryptocurrency how digital funds can become tied to your personal spending and banking habits.
Now we will get to see what happens on a large scale when your online activity is directly tied to your personal finances. Where your social media and gaming accounts have real wallets that can be used to buy shopping, pay bills and earn interest.
Web3 is an idea for a new iteration of the World Wide Web which incorporates concepts such as decentralization, blockchain technologies, and token-based economics.
Bloomberg has described Web3 as an idea that "would build financial assets, in the form of tokens, into the inner workings of almost anything you do online".
One account, to rule them all.
The next iteration of fintech.
Earn money online, put it to work online and then use crypto as your main unit of currency. A fun experiment for an online generation.
The gamification of an entire generation that can create their own economies online, own their own data, build their own businesses, banks, technology.
No wonder it scares the establishment when they have already sewn up the existing markets and created huge barriers to entry for competitors to protect their profits. At the moment there are a lot of concerns about the centralization of technology within a few companies which is giving a lot of people the incentive to work towards more decentralized methods of operating.
When your bank account can be frozen for speaking out against the government, your money seized and your future taken away from you then it stands to reason that there is space for an alternative from of banking.
Fintech combined with cryptocurrency is the solution to this problem and a lot more besides.
We have seen the first few attempts at decentralized finance over the past few years but they are still a long way from being ready to compete with the establishment.
Over complicated, poorly ran and full of exploits. DEFI in theory is a great concept but far from the finished article.
DeFi is short for “decentralized finance,” an umbrella term for a variety of financial applications in cryptocurrency or blockchain geared toward disrupting financial intermediaries.
DeFi draws inspiration from blockchain, the technology behind the digital currency bitcoin, which allows several entities to hold a copy of a history of transactions, meaning it isn’t controlled by a single, central source. That’s important because centralized systems and human gatekeepers can limit the speed and sophistication of transactions while offering users less direct control over their money. DeFi is distinct because it expands the use of blockchain from simple value transfer to more complex financial use cases.
Taking banking out of the hands of the bankers and into your own will be a key part of the next gen of fintech. No more gatekeepers, personal responsibility and unfettered access. All positive factors.
The breakthrough moment will be when a large project creates a smooth connection to the internet of things and the existing monetary system in such a way that you won't even feel it.
Earn crypto for your activities online. Sent them to a wallet, use your phone to spend those funds without even having to swap the currency. Let the wallet do all of the work.
It is happening but slowly and with a lot of failures along the way.
That is the nature of technology. Failing forwards.
Every fail and success will lead us closer to that end result which we are looking for and the next advance of fintech.
Posted Using LeoFinance Alpha