2020 is nearly over; it is time to celebrate and look forward. In this case I am starting by looking back on the history of Fintech from 2008 to 2020 and then looking forward to next year and the distant future of 2024.
The 2008/9 start date is obvious as it was when the Global Financial Crisis (GFC) tsunami hit banks and it was the time of Fintech Cambrian Explosion including the most significant startup (Bitcoin). The 2024 end date is peering into the future and is more idiosyncratic as it is 10 years after I wrote the first post that started Daily Fintech.
During the dark days of the GFC, I recall a presentation outlining a thesis that the debt tsunami was obviously massive but that the technology wave that will follow will have an even bigger impact. I thought at the time that it was probably true but did not do anything about that insight until 2014.
2014 was when Daily Fintech started. Bitcoin was in a bear market but startups using traditional centralised SMAC (Social Mobile Analytics Cloud) technologies were getting to scale and getting on the radar screen of bankers.
2020 was the Pandemic Everything Crisis (PEC). It impacted our health, politics and finances. It also accelerated digital disruption leading to my forecast for 2021.
2021: Bad news for finance incumbents. The combination of digital acceleration, bloated cost base & pandemic induced debt crisis will hit many finance incumbents hard; some will reinvent themselves but many will face a Kodak/Blockbuster/Borders like fate. During this time, expect to read a lot of well written articles expressing scepticism about the disruption hitting incumbents. When you read these “don’t forget Amaras law”.
2024: Amaras law becomes obvious. By obvious I mean like saying today that the Internet impacts our lives. By 2024 it will be obvious that the technology wave that followed the debt crisis of 2008 was even bigger and changed everything in finance.
Roy Amara (computer scientist & head of the Institute for the Future) coined the “law” that we tend to overestimate the impact of a new technology in the short run, but we underestimate it in the long run. As Matt Ridley advises in his Rational Optimist blog to be “wary of the initial hype but wary too of the later scepticism.”
Happy New Year. Four things to celebrate – a new year, vaccines, Bitcoin price & Fintech going mainstream.
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