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Some big questions about the future answered

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In discussion with a client the other day, we got into a debate about how to structure the next workshop with management. The result is that there were five critical questions proposed:

  • How far can we automate everything?
  • How can we use technology differently?
  • Can regulators keep up with these changes?
  • Could the network run the system?
  • Do we even need intermediaries?

These are questions I’ve toyed with many times on this blog, but thought I would tackle them direct in this update. Let’s take each in turn.

How far can we automate everything?

Software eats the world. We can automate anything these days. Just look at ChatGPT and MidJourney and more. The AI system is eating the world. We can automate anything and everything that can be automated, and we are, and we will. What this means for jobs is a big question but, as I wrote the other day  the main job will training and maintaining the machines, rather than us being the machines ourselves. So, automation will move to every area of work and, as has been seen recently, the humans will be the conductors and orchestraters of the orchestra of machines. ‎

How can we use technology differently?

This is a perennial discussion, as technology progresses every single day. A year ago, most of us had no idea about artificial intelligence and yet, now, we all use it. It is similar to all those people all those years ago who said they would never have a mobile telephone. Now, we cannot live without one. Looking forward, we need to consider how to use technologies differently and a vision of where it is all going. I was asked about this the other day, in regard to payments, and felt that the vision has to be one where there is no cash, cheques or even mobile wallets. We just smile and wink to pay and have the whole thing visualised in our augmented reality glasses. Beyond that, well, as Gene Rodenberry envisioned, money just does not exist at all.

Can regulators keep up with these changes?

The problem regulators have is that they can only regulate what they can see. They cannot regulate things unforeseen. This means that there are regular spurts of innovation and change in the markets, and the regulators can only sit and watch and wait. Sometimes they work quite quickly with the markets but, more often than not, they have to wait and observe and assess risks and exposures. That makes sense but it does mean that regulations and regulators are always working by looking in the rear window and rarely, if ever, looking forwards through the windshield. Due to the speed of change with technology, this is something that needs to change before the horse is out of the gate before anyone realised what was happening (note: bitcoin).

Could the network run the system?

Speaking of bitcoin and regulations, this is where we get this impasse between centralised control versus decentralised democratisation. Due to the nature of today’s networked economy, the people can run the system themselves. Off the grid and off the radar, billions of dollars are being transacted in things that governments have no oversight. The Dark Net is far more than the system it was a decade ago. Today, everything can be run by Tor and cryptocurrencies and completely out of the radar of any authority. After all, the internet does not recognise countries and borders; it just runs itself peer-to-peer. This is a huge challenge for all authorities and, luckily for them, most people today are not that bothered about being technical enough to understand how to buck the system. Give it another decade, who knows?

Do we even need intermediaries?

The other core tenet of bitcoin in Satoshi Nakamoto’s 2008 paper is that cash could be exchanged electronically peer-to-peer with no financial intermediary involved. This is why banks, and governments, have hated bitcoin and its siblings ever since they first appeared fifteen years ago. Yet, the more they hated them, the more they’ve grown. bitcoin is trading at over $70,000 each today and some countries, like El Salvador and the Central African Republic, have adopted the rogue currency as their national currency. Having said that, in the latter case, they kind of messed it up. As The Street reports:

“Just a few weeks after the country made bitcoin legal tender, the main regulator of the banking industry, the Banking Commission of Central Africa (COBAC), had to remind the government that it had already banned crypto.”

Hey-ho.

Nevertheless, these questions are just a few of the big ones we have to deal with today. A few others would include:

  • What jobs will my children be doing in 2050+?
  • What education should they be investing in?
  • Will they own property and assets, or just rent them?
  • Will they live on Earth or somewhere in space?
  • Could I be cryogenically frozen and, with life enhancing drugs, still be here with them when they’re old?

Uh-oh, I think I’m going off on one. I’ll stick to fintech, banking and the future instead.

 

Chris Skinner Author Avatar

Chris M Skinner

Chris Skinner is best known as an independent commentator on the financial markets through his blog, TheFinanser.com, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal's Financial News. To learn more click here...

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