New innovations in fintech trends will work towards increasing digitization of all our financial affairs shares Erick Pinos of Ontology in this GlobalFinTechSeries Interview.
Catch the excerpts to know more about his thoughts on how blockchain will disrupt the fintech space over time and how global payment platforms will change the way the payments marketplace works.
Can you tell us a little about yourself Erick (including your hobbies!) and what your fintech journey has been like so far?
I’m the Americas Ecosystem Lead at Ontology, where I work with our partners to deploy blockchain use cases powered by our enterprise-grade blockchain. I also run the Blockchain Education Network, where we train university students from around the world to become blockchain developers. My fintech journey started in middle school when I participated in a stock market simulation game as an after-school program. I have a BS in Management from the Massachusetts Institute of Technology (MIT), where I was the President of the MIT Bitcoin Club and a researcher at the MIT Digital Currency Initiative. It was at MIT I discovered blockchain for the first time when I was airdropped $100 worth of Bitcoin as a promotional campaign on campus. Since then my interests in fintech have been focused towards programmable digital assets, especially ones utilizing blockchain.
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We’d love to know your thoughts on how blockchain is and will disrupt the fintech industry over time.
Blockchain enables two key disruptions for the fintech industry. First, blockchains can act as a global settlement layer, which enables triple entry accounting. Double entry accounting revolutionized commerce during the Renaissance by enabling firms to account for both credits and debits. With triple layer accounting, transactions between firms are no longer just agreements between themselves but are also cryptographically secured on a third-party ledger (the blockchain). This helps firms to securely conduct business with as many other firms anywhere in the world without having to worry about encountering fraud or forged transactions. Second, blockchains enable programmable money in the form of cryptocurrencies, whether native like Bitcoin or pegged to real-world assets like USDC. Programmable money enables the creation of new types of financial instruments we haven’t seen before, such as continuously streaming micropayments, time-locked fund distributions, algorithmic minting, burning money supplies, and more.
How, according to you, will the fintech segment shape up in the next couple of years, given the constant innovations and investments in certain areas?
The innovations in fintech trends will work towards increasing digitization of all our financial affairs. Checks are swapped out for direct deposits and mailed statements for paperless statements. Mobile wallets are slowly taking hold as people switch from a cash to credit-based society. People very quickly went from paying in cash to swiping cards to scanning chips. Soon everyone will be tapping their smartphones at cash registers, skipping plastic cards altogether. I expect continued digitization as people become more comfortable with the idea of paying with apps on their phones.
What are your predictions specific to the global payment and processing landscape, what new innovations in this niche will change how payment processing / global banking is done, especially for B2Bs?
Blockchain creates a global settlement layer. Rather than having banks call each other and send faxes back and forth to sync their records, using a blockchain would near-instantaneously settle transactions globally. This significantly reduces operational costs, risks of fraud, vectors of attack from hackers, and more. Many hacks on banks have been carried out by jamming printers and attacking during national holidays when no one is in the office. A blockchain runs all the time and offers a new level of protection for firms engaging in business with each other.
Could you talk about some of the other innovative fintech apps and platforms in the industry that according to you are set to be the new game-changers?
B2B companies like Plaid and Stripe have made huge strides in powering a new generation of financial applications that makes use of banking data that was previously very siloed and fragmented. Some examples are Acorns, Betterment, YNAB, etc. Not only do these apps provide new financial functions for their users, but they also enable extensive analyses on financial data to draw new insights into the state of our financial affairs as individuals and as a population.
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What are some of the top must-have key-features that every fintech app/solution should offer their B2B clients, according to you?
Every fintech app/solution must have quality customer support. It’s very difficult to make a one-size-fits all solution that works out of the box because needs often vary from B2B client to client. Thus, it’s better to have a good customer support team that can help clients set up the product and tailor it to their needs rather than trying to account for all possible needs upfront in the product itself.
We’d love to know what some of your top FinTech predictions for 2020 are?
I predict an increase in digital payments solutions, as evidenced by Plaid being acquired by Visa and Stripe raising another round. Governments and banking consortiums are increasingly becoming interested in issuing their own digital currencies, some powered by blockchain. As these government and company digital currencies are rolled out, blockchain will be legitimized in the public’s eyes. Thus, more people will also inevitably be drawn to Bitcoin as a reserve asset and as an investment opportunity.
Tag (mention/write about) the one person in the fintech industry whose answers to these questions you would love to read!
I’ve been listening to Ray Dalio and what he has to say since I saw him speak at Forbes 30 Under 30 three years ago. Additionally, Patrick Collison from Stripe who predicted in 2016 that the next fintech revolution would be centered around mobile payments.
Your favorite FinanceTech quote
“Cash is trash” – Ray Dalio
Before we wrap up, we’d love a few thoughts on what you’d advise fintech entrepreneurs/fintech providers not to do when building new tech/products.
Engineers and technical founders like myself have a tendency to over-tinker and over-engineer solutions. Often the simpler the product, the better and easier-to-use it is, will make it more likely to be adopted by your customers.
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Ontology is a high-performance public blockchain and distributed collaboration platform. Ontology’s unique infrastructure supports robust cross-chain collaboration and Layer 2 scalability, offering businesses the flexibility to design a blockchain that suits their needs. With a suite of decentralized identity and data sharing protocols to enhance speed, security, and trust, Ontology’s features include ONT ID, a mobile digital ID application and DID used throughout the ecosystem, and DDXF, a decentralized data exchange, and collaboration framework.