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What’s Next for Fintech?

Following a tumultuous period for cryptocurrencies, digital assets, and the broader technology industry, investors have become more cautious of ambitious fintech ventures, and regulators have begun to circle. The sector's near-term future is no longer as bright as it was just one year ago.

PS Quarterly regularly features predictions by leading thinkers and uniquely positioned commentators on a topic of global concern. Following the implosion of FTX and many other crypto platforms in 2022, fintech is stirring greater public suspicion and attracting stricter regulatory scrutiny. With an estimated 1.4 billion unbanked people, and with most citizens of advanced economies relying on twentieth-century payment systems, no one doubts that financial services are ripe for technological disruption. But after a period of irrational exuberance, speculative mania, and market mayhem, the near-future for fintech has become shrouded in uncertainty. With this in mind, we asked contributors to respond to the following prompt:

Tightening economic conditions, high-profile scandals, and closer regulatory oversight in key countries will substantially hamper progress in fintech in the coming years. Agree or disagree?

Johanna M. Costigan

In China, the Ministry of Science and Technology’s official newspaper recently praised Tencent, Alibaba, and Baidu for their contributions to the country’s economy and development. Yet praise does not imply future independence. Over the past two years, the Chinese leadership’s (somewhat delayed) recognition of the platform companies’ significance spurred a fintech “rectification.” What started as a flurry of punitive measures quickly evolved into more systemic control. Earlier this year, Guo Shuqing, the Party Secretary for the People’s Bank of China, announced that rectification of the 14 biggest fintech firms had been “basically completed.”