Technology 4 min read

Wall Street Needs Another Bailout, and FinTech Solutions can Help

Curioso |

Curioso |

Digitization has made it possible for people to take direct control of their finances, resulting in the explosive growth of financial technologies, or “FinTech.” Now, Brick-and-Mortar Banking must face a hard reality: adapt quickly or die slowly.

What do Ptolemy and Wall Street have in common?
A view that everything revolves around them.

Five centuries after Copernicus challenged Ptolemy’s geocentric model, it’s time for Big Banks to face a similar truth: They are no longer the center of the financial system, and neither the economy nor consumers revolve around them.

Like Ptolemy’s Earth, banks have always existed as fixed institutions in time and space. Throughout history, they’ve acted as giant safety deposit boxes, providing a stable place to stash your wealth, and even a way to help it appreciate.

But this also means that banks are intrinsically a middle man.

Their main purpose is to act as an intermediary in financial transactions– something that, over time, has caused service fees and interest rates to rise and, more often than not, personal wealth to decrease.

When compared with the mobility, accessibility, and affordability of electronic banking, traditional banks are looking less like intermediaries, and more like a brick-and-mortar impediments.

Rock Bottom

Wall Street has grossly underestimated financial technology. It looked at FinTech as a smaller, unstructured object in financial orbit around the gravity of established Big Banking.

In the meantime, FinTech was focusing on market niches still unoccupied by traditional players, and its orbit was starting to cut into their financial territory.

As a result, they’ve been slow to realize that the FinTech solutions have created the world in which territories and brick-and-mortar are less relevant. They’ve been even slower to recognize that people actually prefer the superior security features and lower transaction fees that FinTech offers compared to traditional banking services.

FinTech is causing Big Banks to realize that they are no longer the center of the finacial world
FinTech is causing Big Banks to realize that they are no longer the center of the financial world. Oxy_gen |

The popular view seems to be that with their fees and regulation, Big Banks are an unnecessary intermediary in a world that has a growing taste for direct access. The fact that the World Wide Web functions like an intermediary-discarding machine, making a fixed physical presence in personal banking almost irrelevant. It has encouraged the dematerialization of money with cryptocurrencies like Bitcoin and created alternatives to traditional loans like Crowdfunding and Peer-to-Peer Lending.

FinTech Solutions: Introducing Blockchain 2.0

The financial industry is changing, and Wall Street is finally starting to react.

But more than react, they’re starting to realize that they need to adapt.

From US giants like JP Morgan Chase and Wells Fargo to the financial services specialist State Street and even the London Stock Exchange Group: all of these traditional financial institutions have announced that they joined a consortium to develop an equivalent to Blockchain.

On the other hand, some Startups already familiar with Blockchain technology have forged partnerships with over 50 traditional financial institutions in an effort to help Big Banking update their services to a changing market.

R3, for example, is a Startup recognized for knowing the ins and outs of FinTech solutions and has partnered with Big Banks like HSBC, Citi, and Bank of America. Their objective? Eliminate the middle man. Together, they aim to develop a system that allows users to transfer funds from any financial institution to another, and anywhere in the world.
This means that the banks that have either started integrating FinTech solutions into their services or developing their own Blockchain technologies are the ones willing to adapt. These brave few are willing to let go of their outdated, geocentric model of banking, and embrace the fact that market demand is changing.


FinTech is giving people direct control of their finances, and Wall Street is starting to adapt
FinTech is giving people direct control of their finances, and Wall Street is starting to adapt. PureSolution |

How these traditional financial instructions are responding to financial technologies not only proves FinTech is here to stay, but that it’s the future of banking.

Symbiotic partnerships and cross-collaboration are a must for surviving the Fourth Industrial Revolution in general, and partnerships with FinTech will prove necessary in the accompanying Financial Revolution.
Sooner or later, Big Banks will update their view from being a fixed intermediate point in the center to just another body revolving around the magnitude of the Digital Age.



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Zayan Guedim

Trilingual poet, investigative journalist, and novelist. Zed loves tackling the big existential questions and all-things quantum.

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