For the past two years, the global financial industry has had to constantly adapt to the fast pace of forced digitization determined by the COVID-19 pandemic. Many challenges had to be overcome, including an immediate switch to contactless payments, a serious need for invoice payment solutions, and a move to open banking. In the first quarter of 2022, the global fintech industry grew 27% compared to the same period in 2021.
In this context, Unchain FinTech Festival We asked banks and fintech experts in the CEE region to share their views on key topics that dominate the fintech market or will take place in the near future. Fintech attracting attention“ Gather several experts to shape the answer as to how this market will continue to grow.
“According to our research, two of the hottest topics in the fintech industry with the most investment are decentralized finance and settlement, which is an exponentially growing sector of the market. . “, Alexandra Pollack, Co-Founder and CEO of the Unchain Fintech Festival, said:
Astonishing rise in DeFi
Decentralized Finance (DeFi) is a financial technology system that monetarily eliminates the control of banks and financial institutions and replaces them with peer-to-peer interactions, and has formed most of the financial system in the last few years. A recent innovation, DeFi, emerged around 2017 and quickly became a magnificent ecosystem, with capital of over $ 130 billion at the end of 2021. Stablecoin, CDBC, Metaverse, NFT and other digital assets are just a few of the DeFi applications.
However, at least for now, DeFI is not a stable technology as it also requires development in other segments of the industry.according to “Fintech attracting attention” According to the report, 37% of financial professionals interviewed said that DeFi’s main problem was poor interoperability between various blockchain technologies, followed by investments to support these applications. I agree that there is no insurance to protect my home from fraud (30%).
DeFi is also enhanced by the incredible development of new payment options such as digital wallets, QR code payments and encapsulated payments. According to experts, the lack of proper regulatory status at the national and international levels (33%), the high complexity and cost associated with technology implementation (33%) are preventing this segment from developing even faster. 25%), and a decrease in the level of trust and understanding from end consumption (22%).
There are no restrictions to reduce illegal activity
At the national level, innovation is also occurring in the fintech industry using the Central Bank Digital Currency (CBDC), a government-controlled digital currency used by consumers and businesses. According to the report, Sweden, Japan, China and Nigeria are one of the countries planning to adopt this financial solution in the near future. The European Union also has plans to implement this solution.
The advantage is that the state can reduce illegal activities such as tax evasion and money laundering. The main drawbacks are that there is no regulatory status for the CDBC’s virtual world yet, and that the use of CDBC can increase the level of control by banks and governments. The fintech market, on the other hand, aimed for fully decentralized transactions.
For example, Bitcoin, the most famous cryptocurrency, has achieved the highest level of centralization since it began using blockchain technology and has no influential leadership. Such digital assets, NFTs, game tokens, etc. make up the market valued at $ 4.2 billion in 2022. However, it is difficult to integrate these assets into the entire FinTech ecosystem and connect them with other systems.
Very much cybersecurity and regulation
The future of FinTech is certainly bright, but there is still a long way to go before all these technologies, from DeFi to CBDC to digital assets, are 100% secure. According to sources cited in a report released by the Unchain Fintech Festival, the industry is the most risky in this sense, with serious security breaches in the banking industry. “88% of all data branches are due to unintended mistakes by employees.” One of the conclusions of the report.
Cybersecurity, which is necessary but not sufficient for the development of the industry, needs to be intertwined with a solid regulatory environment where clarity, transparency and fairness must be the principles. Unchain FinTech FestivalThe first fintech and blockchain event in the CEE region, will debut in Oradea, Romania on July 13th and 14th this year.
“We will work with Visa and all relevant professionals in the financial and technical industries to form a business environment for payments, loans, insurance, personal finance, e-commerce, banks and more. We are confident that Unicorn has just taken advantage of the great potential of CEE, and through the Unchain Fintech Festival, we will not only grow the knowledge and networking of Fintech representatives, but also the actual innovation and Fintech of the CEE region. growth,“ Alexandra Pollack concludes.
In addition to the Banking Innovation Research Project at CEE, the Unchain Fintech Festival team is conducting a series of pre-events to give viewers a glimpse into the startup pitching contest included in Oradea’s main event. The event will provide a platform for all of Central and Eastern Europe to showcase the best solutions offered by companies in one of the world’s most talented and fast-growing regions.
https://www.romaniajournal.ro/business/financial/fintech-under-the-spotlight-cee-market-report-launched-by-unchain-fintech-festival/ “Fintech Under the Spotlight” CEE Market Report Launched by Unchain Fintech Festival-Romanian Journal