Getting A Head Start
Companies Are in Full Swing
In a new report by PwC including 600 executives from 15 territories, 84 percent who took the survey said their companies are actively tapping into blockchain technology. Presently, Amazon, Microsoft, and Facebook are in the process of identifying, clarifying, and organizing system requirements, with Facebook announcing in May it was reorganizing to include new blockchain efforts. Equally, IBM, Accenture, Deloitte, JP Morgan, and HSBC are among other big brands exploring similar initiatives. The competition is heating up.
In another survey from Deloitte Center for Technology, Media & Telecommunications found that 40 percent of executives from the telecom, media and technology (TMT) space want to invest millions in blockchain research over the next year. Moreover, it revealed that venture capitalists had invested $1.3 billion in blockchain startups in the first two quarters of 2018. Blockchain technology first became popular in 2009. Since then, the number of GitHub projects on its open-source development platform has grown significantly.
Hitting It Out of the Park Yet?
Further, a staggering large market is apps. According to TechCrunch, people will download an estimated 268 billion apps exceeding $77 Billion in revenue by year’s end. App downloads will generate an estimated $6.3 trillion by 2021. Predictions are that tech giants Google and Apple will dominate the market at 30 percent of the total profits. Brands like Mobius, ChainLink, and IOTA are competing for the next best position.
Cyrus Khajvandi, co-founder of Mobius, anticipates the creation of “Smart Markets”. In smart markets, data from connected devices can be traded freely between other devices. Mobius is taking a road less traveled. Focus is on consumer appliances that utilize smart contracts to decentralized electric generators. These do not only run appliances and allow for machine-to-machine payments. They also employ “smart auctions” in competition for the lowest energy cost. On their heels is IOTA with a significant head start. IOTA is seeking to make “every technological resource a potential service for trading on an open market.”
A League of Its Own
On the global market, the number of FinTech companies worldwide are greatly concentrated in the United States, mostly in the Silicon Valley, with the United Kingdom coming in a distant second. However, the majority of digitally-active consumers using FinTech services reside in Europe. The United Kingdom, Spain, and Germany are leading the way.
As the market gets ever more crowded and consumers become more selective, FinTechs will have to identify new ways of standing out from the crowd if they want to survive, let alone succeed. The key is to leverage every opportunity available to establish even the smallest advantage as competition is growing fierce.
Innovations in financial technology have the potential to transform the way we do business. Whether initiated by banks, established technology companies or emerging fintechs, they pave the way for a new financial services ecosystem. This brings both risks and opportunities, but by approaching technology innovation in a way that is constructive, collaborative, and customer-focused, the opportunities can greatly outweigh the risks.