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Andrea Minto, Moritz Voelkerling, Melanie Wulff, Separating apples from oranges: identifying threats to financial stability originating from FinTech, Capital Markets Law Journal, Volume 12, Issue 4, October 2017, Pages 428–465, https://doi.org/10.1093/cmlj/kmx035
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1. Introduction
Overview
Over the past few years,
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the financial sector has been undergoing structural change. New providers who combine digital technologies with financial services in an innovative manner (known as FinTech companies) have been nibbling away at incumbents’ market share and profitability and are thus transforming the financial industry’s competitive patterns.1 Not only has competitive pressure become more intense, but the structure of financial institutions is being transformed and the dividing line between institutions and financial markets blurred.2From Google Wallet to Bitcoin, all these technology-enabled financial innovations have been a ‘wake-up call’ to address the regulatory aspects of a new ‘era’ of financial services and market players. The FinTech sector comprises a very heterogeneous group of providers of technology-driven financial innovations. Some of them open up new markets in the financial industry; others offer new solutions to replace or augment products or services already offered by banks, asset managers or insurance companies. More changes are underway with the rapid growth of agile innovative players boasting new business models, user-friendly consumer interfaces, peer-to-peer services or advanced automated tools.