Collaboration between regulators and companies with regards to fintech innovations like blockchain technology is expected to improve after the UK Financial Conduct Authority (FCA) announced the launch of a new global initiative.
The new alliance called Global Financial Innovation Network (GFIN) will work together with 11 financial authorities and related organizations and has the objective of helping startups communicate more efficiently with the regulators as they scale their ideas across the globe.
According to the press release, the three primary functions of the GFIN will include acting as a network for regulators to collaborate and share the experience of innovation in respective markets, including emerging technologies and business models, providing a forum for joint policy work and discussions, and providing firms with an environment for cross-border solutions.
Sharing his thoughts on the latest achievement by the FCA, Christopher Woolard, the agency’s Executive Director of Strategy and Competition said,
“The establishment of the GFIN can help share the experiences and knowledge from across different markets, while also providing a platform for innovative firms wishing to scale their propositions via testing in multiple countries.”
Emerging technologies that will come under the watch of the GFIN includes the distributed ledger technology (DLT) and artificial intelligence (AI). Also, cryptocurrency exchanges could benefit in one way or the other since the alliance is also tasked with improving the regulation of securities and Initial Coin Offerings (ICOs) as well as know your customer (KYC) and anti-money laundering (AML) cases.
In the long run, it is expected that the new initiative will “harness the benefits of innovation in financial services for consumers while managing the potential harm.”
The bigger picture
The FCA has made a move that calls to mind a July analysis made by the Big Innovation Centre, DAG Global, and Deep Knowledge Analytics. The report predicted that the UK will become a leader in blockchain technology and the crypto economy by 2022 and right now, a move in the right direction has been made.
It may be an early cry, but the new initiative could solve one of the biggest problems facing blockchain startups and companies, that of communicating clearly with regulators from different jurisdictions. This will likely freshen up the ecosystem and lead to the incubation of new blockchain ventures within the next four years, and maybe then the prediction will come true.