How history will influence the future of the financial services
If you were a trader in any of the world’s major financial centres in 1990s, the weather might change but your working environment would have been remarkably constant. Your skill and value was based on your network, your understanding of the interaction between basic maths and the news cycle, and your ability to think fast and spot a turn. A healthy dose of testosterone and a mild addiction to adrenaline also helped. You’d spend your days dividing your focus between a Reuters Equities 2000 screen and a phone, and your nights swigging champagne and playing spoof to try and get some else to pay for the next round.
Spoof is a simple game where each player has to guess the total number of coins their fellow players have in their hands (generally up to three). Each player makes a guess at the total number of coins being held and the person that guesses correctly wins and doesn’t need to participate in the next round. The last person left in has to get drinks for everyone.
Ten years later and professionalism, advanced maths and computer modelling had started to take over. Trading desks were shrinking as technology automated first the back-office, then the mid-office and finally the trading itself. By the end of the new millennium’s first decade, headcount in the financial services had been quietly whittled down, the city bars were being replaced by sandwich and sushi shops, and spoof was played so rarely that people were having to consult their phones to remind themselves of the rules. The financial crash of 2008 accelerated the change.
Old traders retired (or were retired) to their suburban bolt-holes where they divided their time between parent/teacher meetings and a multiscreen set-up in the study. As time has gone on, they have tended focused more on trading crypto than equites and FX. Different game, same rules.
Returning from the wilderness (AKA suburbia)
These days, if you look closely at the most innovative organisations in the crypto sector, many of the leadership teams are actually comprised of people that used to belong to a financial services organisation.
Twenty years ago, these people would have had a clear career path through the financial services: do their time on a trading desk, have an innovative idea, take it up the leadership chain for their buy-in, either set up a desk within the organisation or spin something out with the parent company’s blessing and reap a percentage of the rewards.
The modern paradigm has these people setting up or joining innovative crypto companies. This means that crypto organisations in the financial services sector are set up completely separately to the banks but have leadership teams that potentially know how to innovate their way around their established competitors. This could have a significant impact on the way that the sector develops over the next few years.
Spoof: the next generation
This plays into the fascinating stand-off between the crypto sector, banks and regulators.
The crypto sector thinks it has an innovative new way to create and manage wealth using distributed ledger technology (DLT) but is aware that engaging with regulators could constrain its ability to innovate. The banks fear that DLT could make the playing field less even, that crypto organisations are unconstrained by the regulatory expectations that the banks have to adhere to and as a result crypto is starting to eat into their profit without having to act with the same level of responsibility. The regulators meanwhile, are concerned that the crypto sector is potentially rife with the types of risky and possibly even outright corrupt practices that they like to think they have all but wiped out of the traditional financial services sector.
The pandemic has given people a lot of time to think, and we are about to witness a significant acceleration in the wave of DLT-based innovation that was already coming from the crypto space. All three sides need to sit down in good faith and develop a fair framework that works for innovators, incumbent businesses, regulators and ultimately the taxpayer so that we can all enjoy the benefits that crypto could be offering.
Of course, just to complicate matters, several of the regulators are in subtle competition with each other as they strive to encourage business to come into their spheres of influence (as we discussed in my last article on special purpose acquisition companies (SPACs) https://quacken.medium.com/how-history-will-influence-the-future-of-the-financial-services-8209c9ee8c27). This means that the regulators as well as the banks and the crypto innovators are in healthy competition with themselves as well as each other.
Several sides sitting down and trying come to the best agreement while simultaneously guessing what the other has in their hand? It turns out that the traditions of the game of spoof live on.
QATO CONSULTING LIMITED
Collingham House 6-12 Gladstone Road
SW19 1QT London
About Marco Quacken
Marco has a passion for business development that helps projects succeed and businesses flourish. With a global network of contacts, he brings teams together, matching expertise to requirements and implementing strategies that help good ideas grow into sustainable businesses. He has experience across a range of sectors including finance, real estate, technology, advertisement, automotive, consumer goods, energy, retail, sports and telecommunications.
This release was published on openPR.
Permanent link to this press release:
Please set a link in the press area of your homepage to this press release on openPR. openPR disclaims liability for any content contained in this release.
You can edit or delete your press release How history will influence the future of the financial services here
News-ID: 2279800 • Views: 454
More Releases from Qato Consulting Limited - Marco Quacken
NFTs: But is it art?
One of the topics that has kept popping up throughout the last year has been non-fungible tokens (NFTs), these funny little bits of cryptology that, in the eyes of the evangelical, have the potential to replace money, change the nature of commerce, and revolutionise the very functioning of the financial markets. Many other people are scratching their heads wondering if they really as good as all that and even if
Is this the dawning of the age of the metaverse?
Most of the time, people not involved with a specific sector can ignore the buzz words that seem to inevitably spring up around an interesting idea. The trick is to wait for them to reach the point where it looks like they might get to a critical mass and become important to a wider audience. The metaverse is one such word, something that’s just starting to become visible in the
Will CBDCs bring balance to crypto?
Crypto’s independence is the answer to several of humanity’s challenges, but its freedom also attracts scams that earning criminals billions each year. Is there a way for society to enjoy the benefits the emerging digital currencies while reducing the risk of fraudulent behaviour? Some say that central bank digital currencies hold the answer, but there is a risk that they don’t solve the issues, simply change the nature of the
Will you accept crypto becomes when will you accept crypto?
Crypto has achieved many things in its short life. It has been lauded as the next big thing while simultaneously being pilloried as an accident waiting to happen (or being an accident in the middle of happening). Regulators have spoken out against it at the same time as small investors have flocked to it. Pages and pages of content have been written explaining why this time, crypto is going to
More Releases for DLT
Info-graphic view of Blockchain Distributed Ledger Technology (DLT) Market Viewp …
Blockchain Distributed Ledger Technology (DLT) Market Study 2022-2027: Blockchain Distributed Ledger Technology (DLT) Market (Newly published report) which covers Market Overview, Future Economic Impact, Competition by Manufacturers, Supply (Production), and Consumption Analysis, and focuses on various products and other market trends. The market research report on the global Blockchain Distributed Ledger Technology (DLT) industry provides a comprehensive study of the various techniques and materials used in the production of Blockchain Distributed Ledger
Data Load Tool (DLT) Market 2022 Status and Outlook- Pennant Technologies, IBM, …
The Data Load Tool (DLT) Market 2022 provides a unique tool for evaluating the Market highlighting opportunities, and supporting strategic and tactical decision-making. This report recognizes that in this rapidly-evolving and competitive environment, up-to-date marketing information is essential to monitor performance and make critical decisions for growth and profitability. It provides information on trends and developments, and focuses on markets capacities and on the changing structure of the Data Load
Data Load Tool (DLT) Market to Witness Huge Growth by 2027 | Microsoft, XLM Solu …
This Data Load Tool (DLT) market research report contains extensive industry statistics, such as level of inflation, market pattern, requirement, availability, and valuation record. It only provides industry data and does not include any content that is useful to a person's immediate surroundings. This market report contains the transactions as well as the transactions that occur while on the lookout. It includes all research materials related to overview, evolution, and
Blockchain Distributed Ledger Technology (DLT) Market Insights 2021, Industry De …
The analysis report offers an in-depth study of the potential market growth opportunities and challenges. The Blockchain Distributed Ledger Technology (DLT) Market report deeply assesses the current, historical market size, market share, and revenue growth rates to offer accurate market projections for the forecast period. Moreover, the report further illustrates the intense competition among the key market players and highlights their effective business expansion plans and strategies. The Blockchain Distributed Ledger
Blockchain Distributed Ledger Technology (DLT) Market to See Huge Growth by 2026 …
A distributed ledger is the consensus of replicated, shared, and synchronised digital data geographically spread across multiple sites, countries, or institutions. Unlike with a distributed database, there is no central administrator. The distributed ledger is also permission or permission less. This determines if anyone or only approved people can run a node to validate transactions. It is the Building block of â€œinternet of value,â€ and enable recording of interactions and
Blockchain Distributed Ledger Technology (DLT) Market 2021 Future Set to Massive …
(United States, Portland): The Blockchain Distributed Ledger Technology (DLT) Market research report presents a comprehensive assessment of the market and contains thoughtful insights, facts, historical data and statistically-supported and industry-validated market data and projections with a suitable set of assumptions and methodology. It provides analysis and information by categories such as market segments, regions, and product type and distribution channels. The report begins with a brief introduction and market overview of