ABSTRACT
Since the beginning of the century, modern financial systems have been experiencing a period of dynamic change. These changes have caused the uniform fabric on which the systems were based for a long time to become eroded and a multitude of alternative entities to appear in their place. The existing systems are becoming increasingly heterogeneous and less transparent. In addition to the traditional financial system based on highly regulated financial intermediaries with a legal monopoly, an alternative sector is emerging. It is based on an often different market infrastructure that allows the direct allocation and acquisition of funds on a P2P or B2B basis as well as on other rules and intermediary entities. A special role is played in this process of change by current technological innovations, especially the ubiquitous digitalisation of financial systems.
The aim of this chapter is to discuss and analyse the main components of digital finance and the interrelations between them. In addition, it is also our intention to show their wider social context. The chapter focuses mainly on the architecture of financial systems changing under the influence of digitalisation, the changed nature of financial service providers and the changed range of products and services of the financial market. At the same time, we will also look at the new threats to the functioning of financial systems.
