FinTech at Davos

In January 2016, the global banks proclaimed that they are all FinTech innovators now, reported Bloomberg in its coverage of the annual World Economic Forum conference in Davos.

No such grandiose headlines for FinTech this year. The inauguration of President Donald J. Trump gave attendees other things to opine on, and 2016 produced the kinds of things that interest techies but don't make for bank-executive pronouncements. The innovators are emerging firms, not global banks, though large financial institutions will make or break cryptofinance implementation.

This year, the FinTech conversation at Davos, hosted by Henry Blodget, CEO and editor-in-chief of Business Insider, noted the growth in FinTech activity in Asia, where the largest FinTech investments took place last year. Panelists discussed the habits and desires of a new generation of customers, the digitization of currencies, and the great mobile shift.

The importance of regulators and their lack of FinTech preparation came up as well, as covered in a bobsguide report. Watch the full Davos FinTech panel.

White House sets forth FinTech framework for United States
The White House National Economic Council published “A Framework for FinTech,” a whitepaper which outlines the agency’s expectations for firms within and interacting with the FinTech sector, the Econo Times reported. The principles within the document include: maximizing transparency, considering consumers first, and building cybersecurity and privacy protections from the beginning. The report gives an overview of the reports published over the past year and endorses the so-called "responsible innovation" framework for FinTech promoted by the United States Office of the Comptroller of the Currency.

Can London-Brussels FinTech bridge save FinTech startups from leaving UK?
Following the UK Brexit vote, startups and entrepreneurs became concerned about the lack of connection between the UK and other European countries, which could slow FinTech growth. But the Belgian government-owned platform called “B-Hive” signed a memorandum of understanding with Innovative Finance to ensure that FinTech startups from both the UK and Belgium could collaborate with one another for creating and marketing new financial technologies, The CoinTelegraph reports.

Bank products are dead. “Long live experiences!”
For some time, banks have viewed brick-and-mortar branches to be the most important means to generate revenue and build customer relationships, but not anymore. Brett King, who has predicted the decline of bank branches since 2005, writes in a post for LinkedIn Pulse that banks must turn their attention to digital products if they want to stay relevant, citing trends in the U.S. and abroad.

THE BLOCKCHAIN WATCH

Coinbase gets NYDFS virtual currency license
The New York State Department of Financial Services granted a virtual currency license after conducting an extensive review of the company’s applications. The agency also granted licenses to XRP II and Circle Internet Financial, and charters to Gemini Trust Company and itBit Trust Company, according to Finextra.

SWIFT, The DTCC and how blockchain will go mainstream
Banks are going to catalyze blockchain’s entrance into the mainstream, not nimble FinTech firms, writes Noelle Acheson for CoinDesk. Both DTCC and SWIFT are combining blockchain with their existing systems. "It will enable DTCC and its clients to further automate and reduce the cost of derivatives processing across the industry by removing disjointed, redundant processing capabilities and associated reconciliation costs," writes Roger Aitken, who covers financial markets for Forbes.com.

Blockchain could save investment banks up to $12 billion a year: Accenture
A new report from Accenture found that blockchain could cut infrastructure costs from $8 billion to $12 billion per year by 2025, but its estimates did not include costs for integrating the technology, Reuters reports.