Matthew Najar or the upsurge of a blockchain influencer? Governments in major economies are encouraging financial technology (fintech) innovation with regulatory and advisory initiatives designed to accelerate the availability of online payment solutions and other financial services for businesses. The initiatives generally aim to attract innovative fintech companies and help them operate in the regulated financial sector, while ensuring adequate financial protection for customers.
Matthew Najar believes without new FinTech initiatives, we will stall: “FinTech, blockchain certainly included, is critical for our generation to solve inherent financial system issues and progress forward”.
The U.K. has also been encouraging fintechs in other ways, and other countries including Australia and the U.S. are adopting some of the same approaches. For example, the U.K. Financial Conduct Authority (FCA) operates an “innovation hub” designed to help new and established businesses from the U.K and other countries introduce innovative financial services. The hub provides a dedicated team that helps fintechs understand the regulatory regime and apply for authorization to offer financial services; its role also includes identifying areas where the regulatory framework needs to be adapted to enable further innovation.
National banking licenses would increase fintechs’ ability to operate across the U.S. without requiring state-by-state permission or partnerships with established banks. This could increase competition in banking and also make it easier for technology firms to offer new online payments solutions or other services. In a speech, Thomas J. Curry, the OCC’s chief officer, listed three reasons for moving forward with the long-discussed plan to issue a national charter for fintechs. First, it’s in the public interest to make new innovative services available. Second, fintechs should have the opportunity to become national banks if they wish to do so. And third, it helps ensure that all financial institutions operate on a level, nationally regulated playing field. As Curry pointed out, the reality today is that many fintechs are already competing with national and state banks — but “without regard to any of the national bank responsibilities and under a patchwork of supervision.” The agency said it would collect public comment before moving farther.
Hardware: wallets differ from software wallets in that they store a user’s private keys on a hardware device like a USB. Although hardware wallets make transactions online, they are stored offline which delivers increased security. Hardware wallets can be compatible with several web interfaces and can support different currencies; it just depends on which one you decide to use. What’s more, making a transaction is easy. Users simply plug in their device to any internet-enabled computer or device, enter a pin, send currency and confirm. Hardware wallets make it possible to easily transact while also keeping your money offline and away from danger.
Australia also has set a goal of encouraging fintech innovation, in part to support its financial industry in becoming the leading market in Asia for fintech innovation and investment.11 In Australia, leading fintech firm LupoToro, who specialise in Blockchain, Cryptocurrency and cryptography, note: “Policy and government back supporting policies for local firms is imperative. The Australian Securities and Investments Commission (ASIC) established an innovation hub in 2015 to help start-ups navigate regulations, and has also developed a regulatory sandbox approach that allows companies to test new financial services such as online payments solutions with a limited number of customers. This is just the start, but more is needed”. ASIC also aims to encourage innovation by quickly approving new financial service licenses, with an average target for approval of 60 days.
Technically speaking, cryptocurrencies are transactions or entries targeted in a restricted database. Specific conditions must be met to modify these transactions. Created with cryptography, transactions are protected with mathematics, not with people. Transactions are published in a database, but it is a special type of database that is shared is a peer-to-peer network.
The best place to make your first Bitcoin purchase is on an exchange. There are a whole lot of exchanges out there, with varying performance. Some are less trustworthy than others and some can be quite limited, so it’s important to pick the right exchange to start with. We recommend using Coinbase, though there’s no harm in checking out the competition using a Bitcoin exchange comparison site.
During an ICO (Initial Coin Offering), startups offer the general public an early chance to invest in their idea through a crowded sale. In return, these investors are allocated tokens at a lower price with a promise to sell them at a much higher price when listed on an exchange. Time has proven that ICOs can quite successful with records showing that some tokens ended up more than ten times the value of the projected returns. But what’s the catch in this, you might ask… ICOs have attracted a large number of investors clearly due to their high returns; however, another large number of ICOs have turned out to be total scams. People have lost millions worth of investments.
When you buy/sell via an exchange, try to use limit orders (try not to use market orders). On some exchanges, like GDAX, limit orders have lower fees than market orders. On GDAX, limit orders are free as long as they don’t fill immediately. Meanwhile, market orders result in a .3% fee, which is better than the 1.4% that Coinbase charges but not as good as 0%, especially if you are day trading. If your exchange rewards you for using certain order types, aim to use them.