So how big is financial technology? According to many financial experts, it could be as big as the internet.
During a virtual meeting with European Parliament, Gary Gensler, the chairman of the United States Securities and Exchange Commission, said that the current revolution of the financial industry started by fintech companies and cryptocurrencies could be just as transformative as the Internet.
“I think the transformation we’re living through right now could be every bit as big as the internet in the 1990s,” Gensler said as he spoke to the Parliament’s Committee on Economic and Monetary Affairs, sharing his recommendations on policy surrounding the regulation of crypto assets.
Gensler said he believes that the cryptocurrency market, now valued at $2.1 trillion, is a “truly global” asset class: “It has no borders or boundaries. It operates 24 hours a day, seven days a week.”
Clearly, something big is happening, and those spectators who said that cryptocurrency and other forms of fintech were just a fad — they have been proven wrong.
The revolution isn’t just happening in Europe, either.
The U.S. Congress has now passed a $3.5 trillion infrastructure bill that has major ramifications for the fintech industry, as there have been proposals to begin taxing crypto businesses.
While many market observers expect America to roar back from the pandemic, it will still be vital for the US to embrace the fintech industry as it tries to return to a pre-pandemic economy, according to Siobhan Dullea, CEO of MassChallenge and Member of Mass Fintech Hub.
Given the economic hammer blow dealt to America and the world by the pandemic, there’s no better plan than to support the fintech industry, which raised $30.8 billion during the second quarter of 2021, wrote Dullea for Traders Magazine.
“The common link is investing in community – without it, our American recovery will stagnate to the detriment of business and society at large,” Dullea wrote. “If we embrace diverse leadership and a strategic, long-term approach based on collaboration, we will emerge stronger than ever before.”
The numbers are similarly encouraging in Canada, where fintech saw a record start to 2021, with the momentum almost certain to continue for the rest of the year.
During the first two quarters of the year, 58 fintech companies in Canada made a total of 61 deals backed by venture capitalists, with a total of $2.71 billion in total disclosed funding, according to Mondaq.
That’s compared to just $113.58 million invested in 46 Canadian fintech companies in 2020.
“So it’s clear to see that FinTech is on the rise in the Canadian market,” according to Mondaq. “While many have said that the pandemic attributed to some of the decreases in investment in 2020 and the subsequent increase in 2021, we believe that the FinTech ecosystem is on the rise and we will continue to see this trend into the second half of 2021.”
The time for doubting fintech as the next great disruptive industry is long past, despite the naysayers who continue to question it, he said.
“We’re going to keep seeing fintech go up and up, and this is only the beginning,” Bardya Ziaian said. “What’s so powerful about this new trend is that it affects every part of the finance industry, which has long been dominated by a conservative streak. It took 25 years of the Internet’s development for the digital transformation to really hit the finance industry, but now it’s happening, and the revolution is going to speed up from here.”