ABSTRACT
This chapter examines the impact of digital technology in the provision of financial services in the UK and internationally. This innovation, often referred to as FinTech (financial technologies), comprises inter alia cryptoassets, online platforms, artificial intelligence and RegTech (i.e., applications of digital technology by regulation and compliance actors). The aim of the chapter is to discuss the importance of the ‘world of alternatives’ – alternatives to money like virtual currencies, alternatives to credit like peer-to-peer and crowdfunding platforms and alternatives to payments, such as shadow payments – from the perspective of financial innovation. In this context, the chapter analyses the evolution of FinTech in the banking sector with emphasis on blockchain and automating mechanisms. It also examines the implications of regulatory technology and its main effects in banking compliance. The structure of virtual currencies and digital platforms is discussed in the light of the recent regulatory developments. The ‘digital revolution’ is examined along its implications on monetary policy, prudential regulation and investor protection.
