7 Technologies Disrupting Finance Industry
In recent years, people have experienced the wonders of modern technology when it comes to managing their finances and accessing financial services. This trend is only expected to improve and continue with the advancements in technology like AI, cryptocurrency, blockchain, VR, and AR, among many other things.
But getting to this point has been a bit slow for the financial industry as compared to other industries who have arguably fewer developments in the technology department.
It’s understandable for the financial sector to have a slower response in the digital disruption due to the sensitive data that they hold.
There’s also the issue of established legacy systems that they have relied on for years. Something that newer and more agile financial companies are not facing due to less dependency on the system. These FinTech companies have the luxury of constantly re-evaluating and re-organizing their business model to give modern solutions to modern financial problems of customers today.
Rules and regulations have also hampered down the advancement of traditional financial companies. Most regulating bodies still don't know the capabilities of some of these technologies and the negative impacts they might have on both the ecosystem and the customers.
Despite these obstacles and due to the fast-changing behavior of customers and increasing competition from FinTech companies, a lot of financial companies have no choice but to digitally transform to provide the best service to their customers
Since fintech companies, normally, don't fall under the jurisdiction of these regulating bodies, they have been pushing the envelope and have experienced successes in implementing them. A great example of this is cryptocurrencies like Bitcoin and Ethereum that have experienced tremendous growth in the last decade. Now, traditional companies are exploring how they can use cryptocurrencies and blockchain technologies to carry out traditional tasks that are considered rigid, slow, and insecure. Some companies have also started accepting cryptocurrencies to pay for specific services.
We could say that, somehow, traditional financial companies are trying to keep up with the changes. But if they continue at this pace, they will always find themselves lagging behind modern and more flexible service providers. Soon they'll find that traditional financial advisors may not be as effective as an AI who can predict the most ideal investment streams or that people don't want to be bothered driving to physical banks since financial transactions can now be securely done through mobile phones.
The key to the industry's survival is to spearhead the implementation or experimentation of these technological tools instead of waiting for the next move of technology companies.
In this infographic created by Prototype, a digital transformation company, you'll see a list of modern technologies disrupting the finance industry, the factors driving these changes, and trends these companies should watch out for.
Infographic by: Prototype
How Blockchain Can Democratize Artificial Intelligence Development
Data Access for AI: An Under-Explored Use for Blockchain
There is a vast amount of computing power around the world that is not used efficiently. There are an estimated 4 billion personal computers in the world and 90% of them have free capacities at any given moment. This is to say nothing of the idle capacities of other personal devices, like smartphones and tablets. In effect, this excess computing power is wasted.
Lots of startups are trying to use blockchain technology to take advantage of this inefficiency to meet different economic needs. The blockchain is exciting in this context because it provides an infrastructure for distributed computing power, while at the same time providing an incentive for individuals to link their idle devices to the network.
Many of the startups I’ve come across are focused on providing web hosting and/or data storage solutions via blockchain. However, the use case I think is the most exciting involves artificial intelligence or “AI”.
Democratizing AI
The idea of applying the blockchain to artificial intelligence is attracting a lot of attention. Similar to the goal of distributed data storage and web hosting, some experts argue the blockchain could encourage a broader distribution of the data and algorithms that will determine the future development of artificial intelligence.
However, many artificial intelligence experts are concerned that IBM, Facebook, Google and a few other big companies are monopolizing all the talent in the field. These giant corporations also control the massive silos of digital data necessary to create and refine the best machine learning programs. Many argue there is a need to democratize data if A.I. is to develop in a direction to benefit all of humanity.
This is where blockchain technology comes in.
At the most basic level, just as the blockchain allows...
Rakuten to Launch Their Crypto Wallet March 30th
Rakuten Inc. just announced their intention to terminate “All Bitcoins Inc.” and launch their own “Rakuten Wallet” on March 30. Businesses launching crypto wallets is nothing new, following companies like Line, KIK and KakaoTalk. The news comes after Rakuten completed their filings as a virtual currency exchange company (VCEX.)
The company stated:
Rakuten Wallet will contribute to the sound growth of the market as a virtual currency exchange company and will further enhance security and provide enhanced services so that more customers can use it safely and with confidence.
Rakuten will be filing another VCEX application for Rakuten Wallet in September 2019.
Rakuten Inc. (4755: JP) holds a market capitalization about one-tenth the size of GM’s profits, number ten on the Fortune 100 list.
What Does Rakuten Do?
Earning cashback on purchases can make large purchases a little more enticing if you pair it with decent discounts. Rakuten aggregates discounts and helps customers receive cash back on their online purchases.
Their offerings have struck a not-so-nice chord...
Overstock’s Blockchain Subsidiary Acquires Stake in Blockchain Banking Platform
Retail giant Overstock.com, Inc.’s blockchain subsidiary, Medici Ventures, has acquired a stake in blockchain banking platform Bankorus, according to a press release published on March 11.
Medici Ventures has purchased a 5.1 percent stake in Bankorus, a blockchain banking platform that enables both individuals and institutions to buy, sell, lend and store digital assets. Jonathan Johnson, president of Medici Ventures, said that “the addition of Bankorus to Medici Ventures’ portfolio of companies will further our work in building the foundation of a blockchain-based technology stack for society.” The financial details of the acquisition were not forthcoming.
Medici Ventures has been largely investing in blockchain projects. Last December, the firm
IBM Digital Currency Chief Says They Are Leading in Blockchain Technology
IBM’s Jesse Lund, who heads the blockchain division, claims IBM is the leader in blockchain technology.
In a recent interview, Lund stated:
What IBM’s been doing as the leader in blockchain technology for the last three years is adding security and confidence to the system.
IBM And Stellar Partnership Challenge xRapid
Lund talks about IBM’s cross-border payments solution, which in part uses Stellar Lumens for settlement, and how one of the oldest technology companies in the world plans to revolutionize the remittance market. The solutions developed are challenging Ripple’s xRapid product for adoption, but all the products will have to work together to create a global and harmonious system.
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He explains:
We’re building on a new idea, which is to be able to store monetary value electronically and be able to move that value around the world in real time… I think the problem with cross-border payments today, the inefficiencies are based on the fact that the way that banks communicate, the network that banks communicate on is separate from the network or the rails that money actually...
The Good And The Bad Sides Of Initial Coin Offerings
Cryptocurrencies are the new craze in the world of finance. Anywhere you look, one financial enthusiast is trying to get a grip with the world of cryptocurrencies. They are digital currencies; they are not minted in a central bank or regulated by a sole administrator.
They, however, hold a whole lot of value and are used for transactions. Their secure and decentralized nature made them an almost indispensable asset for several industries.
This brings us to initial coin offerings (ICOs). They would not have been possible without the existence of cryptocurrencies. In the short time that they have been in existence, ICOs became the latest trend in business circles. Simply said, they are are the best way for a startup business to generate investments.
How Do ICOs Work?
Startups offer investors a chance to purchase their tokens at considerably low prices in exchange for valuable cryptocurrencies such as Bitcoin, Ripple, and Ethereum. Due to the low prices of tokens, successful ICOs usually end up raking in millions in investment for the startups. Depending on how successful the startup businesses turn out to be in the future, investors can sell tokens for huge profits.
When Did ICOs Come Into Existence?
This might be very surprising to you, but ICOs are very young. The first one ever took place in 2013 and was held by Mastercoin. The next big ICO was done by Ethereum, which raised over two million dollars worth of investments within the first twelve hours of the process. Today, this cryptocurrency is one of the world's most valuable digital currency.
ICOs became the norms for startups soon after that. By the end of 2016, over a hundred million dollars were raised this way. Last year, that total figure grew to an unprecedented $1.25 billion.
There is no denying it, ICOs have been very vital to the economic and business development of the world as a whole. However, like with every new idea, there are many people very skeptical about this way of funding startups. To be honest, this is a very controversial topic.
Many financial analysts have raised the fact that it is highly unregulated as a major turnoff. Such concern is backed up by the fact that many ICOs were followed by some serious scandals. There have been huge scams and cases where investors have lost entire investments.
However, there are also several important advantages of this way of funding, which continue to attract an increasing number of worldwide investors. Some of the advantages include:
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Middlemen are cut out
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ICOs are available regardless of your location and nationality
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Offer cheap avenues of investments
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Allow you to contribute to the technological development of the globe.
Samsung Galaxy S10 includes storage for digital currency private keys
Samsung’s latest flagship phone will include a dedicated secure storage function designed for cryptocurrency private keys.
CoinDesk - Samsung Confirms Galaxy S10 Will Include Private Crypto Key Storage
CryptoNews - The Mystery of Samsung's Galaxy S10 Private Key Storage Remains
Forbes - Samsung Confirms Galaxy Fold And S10 Security Surprises
The news that Samsung added a private key storage to its new Galaxy S10 smartphone shook the crypto world, as many have taken it as a sign of endorsement from the South Korean tech giant. However, as details are scarce, many are wondering what “hardware storage” the company announced and why it wasn’t mentioned during keynote presentations.
Samsung announced in February that their newest phone, the Galaxy S10, will include secure storage for its users’ cryptocurrency private keys.
The company made a press release detailing the phone’s many features, notably including Samsung’s proprietary defense platform, Samsung Knox, which will feature secure private key storage that it claims is specifically “for blockchain-enabled mobile services.”
Baked-in support for cryptocurrencies in smartphone platforms is not completely unique to the space, although this initiative by Samsung represents a major step for the technology’s integration into mainstream products. As it stands, there are currently two smartphones that support crypto assets: HTC’s Exodus 1 and Sirin Labs’ Finney.
These two phones have seen much more limited adoption than any product Samsung could release for several reasons....
Bitcoin (BTC) transaction average & median fees
Transaction fees make the bitcoin blockchain go round. The miners are compensated for their efforts, not only through inflationary block rewards but also through fees charged to users for adding their transaction to blocks. While fees on average make up about 4% of the total miner revenue per day, with the lion’s share coming from block rewards, sometimes economic shocks cause those fees to rise.
The average fee per transaction is approximately $1.63 with the median being $0.88 over the past five years. The fees are the prices charged for a transaction to get into the limited space of a 1 MB block that occurs every 10 minutes. This results in about 1,800 transactions (~556 average transaction size in bytes) that are able to fit into a block. If the standard 144 blocks are mined per day, we observe a ceiling of about 260,000 transactions per day. Thus there is always a backlog of unconfirmed transactions that reside in the mempool awaiting miners to select them for inclusion in the blockchain.
According to Blockchain.Info, there are about 3.4 million bytes awaiting inclusion in the mempool. Miners will usually include the transaction with the highest fees and work their way down as capacity dwindles to the lower fee transactions. Imagine you are commuting to work and...
Blockchain Slashed Forex Trading Costs by 25% says HSBC Exec
An HSBC executive has said that the bank’s blockchain-based system has helped it cut the costs of settling foreign exchange trades.
Speaking to Reuters, Mark Williamson, chief operating officer of FX cash trading and risk management, who oversees the blockchain project, said that its HSBC FX Everywhere platform saved it 25 percent as compared with traditional methods.
Last month, the bank announced it had settled more than $250 billion in transactions using its HSBC FX Everywhere platform.
It said then that it had settled 3 million foreign exchange transactions and made a further 150,000 payments over the digital ledger system, which it has been using...
Baidu Launches Plug and Play Blockchain Engine (BBE) platform Dapps
Chinese search giant Baidu has launched a blockchain platform aimed to simplify commercial deployment of decentralized apps, or dapps.
Officially announced by Baidu Cloud on Thursday, the Baidu Blockchain Engine (BBE) platform is touted as a kind of operating system allowing developers to produce blockchain applications “just like mobile apps,” and get around the storage and computing “bottlenecks” that are holding up blockchain’s potential.
BBE is built on what the company calls the ABC (AI, Big Data, cloud computing) technology stack, allowing customers to explore and develop ways to commercialize blockchain tech.
Hosted on Baidu’s “intelligent” cloud platform, the system uses a modular blockchain framework to provide developers with a multi-chain system including smart contract templates, dapp templates and other...