STABILITY IN MOTION Chris Skinner on the age of intelligence, where you control how money works for you
The last year has been interesting. It’s been a year of still struggling with investments, where a lot of fringe fintechs have failed while the champions are gaining more momentum. You know the ones I mean, I guess, yet the core of the last year is that we have seen the market maturing. Fintech is no longer a new thing; banks are now comfortable with the changes they need to make; tech firms are supporting both, rather than compete with them; and startups are still emerging but in new ground. In fact, as you look at this, it’s like a forested area. You have the old oak trees (the big banks), surrounded by a wealth of silver birch trees (the fintechs) that have grown but are still not as big as the big daddies; and then you have a load of spruce trees as you enter the forest, which are small and pretty, except for the ones that die and their leaves turn brown. At the core of this is that the fintech world has grown up. The silver birch trees used to be the baby spruces. They haven’t quite grown to the heights or depths of the oak trees, but they are getting there, and this is why most of us now talk about fintech moving from growth to stability. For most of the past 15 years, everything has been about growing the customer base; for most of the next 15 years, it will be more about stability, profits, operations and resilience. For the largest fintechs, they are already there; for the emerging companies, it is a battle. That battle is there for those with best and brightest ideas and vision. WHAT VISION IS REQUIRED? Well, there are two clear trends in technology that I’ve seen over the past year, which will dominate the next 10. What could those be? Easy: AI and crypto. AI is all around as but it’s more than this. It’s AI, agentic AI, GenAI, superAI and more; and it’s all around us. Then,
in each of these areas, it’s the nuances of AI we have to track and trace. How does AI relate to KYC, AML, onboarding, dealing, trading, selling, marketing, customer experience and more. There are huge numbers of innovators in each of these spaces who are doing great things. My personal focus on AI is fraud. The reason is that it creates massive opportunities for the criminal fraternity to take fraud to the extreme, particularly deep fake fraud. Who can you trust in a deep fake world? It’s going to become commonplace for everyone to find that the friend or family member who asks for $100 turns out to be a bot. This is why B2B will become the big thing over the next few years. B2B? No, it’s not business-to-business; it’s bot-to-bot. Bots will be buying and selling to each other. My bank bot will ask my fintech bot to find the best investment in tech today, and my fintech bot will ask their exchange bot to give the fastest movers and risers via their exchange platforms. The list goes on. Bot buying on behalf of consumers will become a big trend, as will bot selling. Banks and fintechs will no longer be selling services to businesses and consumers. They will be selling through their bots to the consumer’s and commercial customer’s bot. Trading, selling, marketing, buying, payments, investing and everything is becoming delegated and designated to the network and its bots. This is the reason for the second big wave of change we see today: stablecoins. Stablecoins, the Genius Act, tokenisation and such like are all emerging as the second big trend to support the B2B world. Bots cannot trade with bots without a currency and the fight we have seen over the past decade is creating currencies that work. These could be cryptocurrencies and yet, for the average person, stablecoins tied to a national currency make more sense.
That’s the reason for the recent GENIUS Act in America which legitimises digital assets and tokenisation, as long as they are tied to the US dollar. Some would say that is a genius move to protect the dollar from dedollarisation; others would say who needs stablecoins anyway, when we have crypto? Then all of that leaves central banks wondering how to keep the currencies of the world tied to their currencies or, as we all call them, CBDCs (Central Bank Digital Currencies). The whole world of currencies and payments is up for grabs and, as anyone who knows these spaces will know, it’s all about power and politics. Crypto is the power of the people controlled by the network that is democratised and distributed while stablecoins are all about creating digital payment flows tied to national currencies in various forms. It’s about power and politics. So, we have these three big themes over the next few years. The stabilisation and integration of fintech into the traditional ways of dealing with finance; the emergence of intelligent systems based upon bots who manage how we deal with each other in finance; and the choice between state or democratised finance for how we pay each other in finance. Fantastic times we live in.
Chris Skinner is an award-winning speaker and one of the most influential people in technology, as well as a best-selling author. He is an independent commentator on the
financial markets and fintech through his blog, the Finanser.com, which has recently voted one of the best fintech blogs in the world and is updated daily. In 2023, Chris was recognised with a Lifetime Achievement Award by The Payments Association.
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The Fintech Power 50 www.thepower50.com
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