Not everyone agrees on the current situation of the global economy, but we know for sure that some governments and institutions are putting in place measures to counter the recession. If we consider the measures taken by the UK government, as well as the opinions of people in the United States, and top executives migrating to the traditional financial space, we’re already in a recession. Fintech is going through these difficult economic times as any other sector, and even if it could be an extremely useful tool for people to tackle financial difficulties, it is under scrutiny from regulators and institutions that might want to institutionalize financial systems to avoid further uncertainty and risk.
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According to a recent survey conducted by BMO Financial Group and shared by CNBC, US people are seriously worried about an upcoming recession. Even if the unemployment rate is at 3.5%, inflation is high and workers are not sure that the future global economic conditions will make it possible to keep unemployment rates low. Because of this, many are delaying big purchases – houses, cars – and focusing on savings.
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FinTech World Forum 2022 (https://fintechconferences.com) is based in London UK Europe as one of leading fintech events 2022 for global financial services, finance and banking technology industry. Its focuses on Mobile Payments, Lending, Insurance, Blockchain, Bitcoin, Investment, Money, Crypto, Cryptocurrency, Digital, Innovation, Wallet, Pensions, Funds, Payment, Tech, Financial Services, Technology, Bank, Wealth Management, Insurtech, Regtech and Wealthtech. For more info visit: https://fintechconferences.com/
The tax cuts announced almost one month ago by the UK government will be reversed. If the measures were meant to help people deal with the recession – which is already threatening the country according to the Bank of England – the new chancellor of the Exchequer, Jeremy Hunt, said that when markets demand “commitment to sustainable public finances, it is not right to borrow to fund this tax cut.”
On Monday, the long-announced launch of Aptos Labs’ blockchain happened. Even if the ecosystem is far from being complete, the project was realized by ex-Meta (formerly Facebook) employees who wanted to focus on decentralization and provide people, businesses, and developers with more intuitive and less costly solutions to join the Web3 revolution.
The rising demand for solutions like those proposed by Aptos could not be a coincidence. Blockchain technology has the advantage of being flexible and distributed, allowing for the creation of new systems and new ways to securely share – and own – data. That’s why blockchain could be the underlying technology of companies that might be stronger and more inclusive than most tech giants.
Blockchain doesn’t necessarily have to be the technology behind new and innovative startups, but also a technology that can be integrated with already existing businesses. Flexibility, inclusivity, and security are not the only advantages of blockchain: it can give you many opportunities to save your money as a business owner and focus more on people.
Despite difficulties, fintech still meets people’s needs – therefore, interesting projects manage to get significant investments. Often, funding rounds are useful to expand across different markets. This is exactly what WeLab, the Hong Kong-based fintech unicorn, did with the capital collected since 2013. WeLab is interested in the Indonesian market, where many are investing, thanks to the young age of the population – more prone to use solutions like the digital banking products offered by WeLab – and an exciting fintech environment.
Not everyone agrees with banks and regulators on the adoption of new regulatory measures concerning the digital economy and assets. The involvement of governments in the economy is a long-lasting debate that makes headlines also today – like after the debate between Rep. Rashida Tlaib and JP Morgan CEO Jamie Dimon on sustainable finance and ESG. Fintech is a good tool to reach sustainable development goals, but it’s also true that solutions like CBDC (Central Bank Digital Currencies) could mean increased control over people’s finances by governments – as Paul Jossey explains in this interesting article published by CoinDesk.
Savings become more important for people, and big companies realize that. Apple is increasingly benefiting from fintech solutions, constantly including them in their business models. In cooperation with Goldman Sachs, the tech company is about to launch a new savings account that will allow users to deposit cash-back rewards that will be automatically added to high-yield savings accounts.
At the same time, regulators and banks would like to have more control over the financial and economic revolution that started with blockchain and fintech. From the recent D.C. FinTech Week, it was clear that institutions would like to find a compromise and integrate the more traditional financial system with fintech, also to provide a stronger and safer regulatory framework for fintech-based entities.
Recession, inflation, and layoffs might change not only regulators’ opinions about fintech, but also top executives’ choices when it comes to considering new opportunities for their careers. Top fintech firms and popular startups found it hard to keep up with the current economic conditions, despite their value, and this led top executives to re-consider the traditional financial system to get more secure jobs.