Tuesday, January 30, 2018 14.30PM /
As the globe continues to witness the evolution of innovative
solution in the digital age, one phenomenon that has continued to generate
discussions and interests from the media, financial analysts, bankers,
regulators, economists and policy makers is the Blockchain technology.
From this Blockchain which has been described as a pathway to
bringing efficiency to inefficient markets and a robust platform for asset
management, is the Digital currency with developments like Bitcoin which is a
Cryptocurrency and world-wide payment system.
2017 was a remarkable year for Cryptocurrency with a massive surge
till December, till the decline in value ensued. Notable and Globally renowned
economist and scholar Professor Nouriel Roubini in a recent article, shared
strong views about the Bitcoin and Cryptocurrency which should be a signal to
investors and analysts.
Prof Roubini advocates investments in fintech firms, which he
believes is a smart choice because of the actual business models, which are
positioned to revolutionize the financial-services industry.
Emerging economies in Africa and
Asia based on their population, require deep penetration of financial services
in what is termed as “Financial Inclusion” which the Fintech firms have
the potentials to drive.
Speaking on what can perceived as the
bubble of Bitcoin, Prof Roubini said in his article “Cryptocurrencies have no
intrinsic value, whereas fiat currencies certainly do, because they can be used
to pay taxes. Fiat currencies are also protected from value debasement by
central banks committed to price stability; and if a fiat currency loses
credibility, as in some weak monetary systems with high inflation, it will be
swapped out for more stable foreign fiat currencies or real assets”.
Roubini also alludes to the concerns of
international policy makers that Bitcoin’s only real use has been to facilitate
illegal activities such as drug transactions, tax evasion, avoidance of capital
controls, or money laundering. Not surprisingly, G20 member states are now
working together to regulate cryptocurrencies and eliminate the anonymity they
supposedly afford, by requiring that all income- or capital-gains-generating
transactions be reported.
The unique takeaway here is that
Professor Roubini believes in the potential of fintech firms in developing that
required technology to deepen areas like insurance, banking, financial market,
and the capital market.
This underscores the value of
strengthening and developing the fintech ecosystems, which was one of the
key resolutions of the recent 2nd National Fintech Conference in
Lagos, Nigeria powered by the Fintech Nigeria Association.
For Roubini the advent of Fintech
solutions, with dozen of online payment services like Paypal, Alipay, Venmo
utilizing the wealth of online data on individuals and firms. He believes the
data improvements in credit allocation will boost the financial market.
Professor Nouriel Roubini is part of the
growing list of global thinkers, business leaders and policy makers that are
acknowledging the role of Fintech in transforming the financial services
According to the 2017 KPMG report on
Fintech investments in the US stood at $5bl while Asia received $1bl.
In Africa the investments hit over $150ml
and in 2018 wise investors will understand that achieving scale, depth,
innovation, disruption, effective collaborations and adoption of robust
technology in the financial services, will come through Fintech firms.
Investing in Fintech, is viable as it
will improve customer service delivery, financial inclusion, generate
employment and drive innovation.
It is not surprising that the reputable
scholar Prof Nouriel Roubini will make a strong case for investments in the
Stakeholders call for robust Fintech ecosystems in Nigeria and Africa
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