Regulating investment capitalism : an ethnography of Fintech

Abstract

Fintech, a portmanteau of finance and technology, as such is not a novelty in finance. The most recent, post- Global Financial Crisis (GFC) however has led to the emergence of new entities within the financial system- Fintech companies. Fintech firms develop technology-based solutions to bring innovation and new technologies to financial system. Their influence on the financial sector has been huge, and is constantly growing due to continuous increase in private investments within the sector, as well as Fintechfriendly regulation. The EU Fintech policy-making has been no different in this regard-it has been created with the objective of accelerating growth and enabling innovation within the financial sector, in addition to traditional financial markets’ regulatory objectives. Moreover, when addressing risks, the EU Fintech framework has followed an activity-based principle (“same activity-same risks-same regulation”). Such approach, however, seems not to be fully adequate for Fintech due to its distinctiveness within the financial system. The thesis thus examines whether or not the existing EU regulatory framework is tailored to the particularities of Fintech. To answer the question, the thesis develops a multidimensional understanding of Fintech. It first provides findings of an extensive desk research that discuss how Fintech has been transforming financial markets and society at unprecedented speed and scale, and how a “laissez-faire” approach to Fintech regulation has contributed to that. The findings of the desk research lead to the second part of the thesis - an ethnographic study of European Fintech industry. This Fintech ethnography provides a counter-narrative to the opportunities and benefits-focused rhetoric that prevails among Fintech businessmen, scholars and policymakers responsible for Fintech regulation. By bringing the perspective of “the inside” to the debate on Fintech regulation, the thesis identifies new concerns and risks, and follows with a set of regulatory recommendations in its conclusions.