The Financial Industry Is Changing.
The topics of fragmentation, disintermediation, Regulation Fair Disclosure, Sarbanes-Oxley and high speed trading, are discussed in our 2008 paper “Information Flow and Finance: Compliance is a Poor Substitute for Accountability”. This paper described, in laymen's terms, a three-phase accountability mechanism within financial institutions that was, in our view, inadvertently disabled via regulation, legislation and automation. In our view, that mechanism drove a powerful internal system used to optimize both profitability and product integrity in the form of well structured, sustainable, liquid financial products. Since that paper was written, billions of dollars have poured into the financial technology (“FinTech”) sector. As FinTech matures, self-governance mechanisms could be reintroduced in an automated form.
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"Crowd funding, micropayment systems and block chain transactions (“financial innovations” or “innovations”) are in various stages of international deployment. At their core, these are not new financial functions, but rather, examples of decentralized system architectures which influence dynamic capital allocation. In other words, by automating capital allocation, in full or in part, these innovations have the potential to impact the lifeblood of free market capitalism. As these innovations advance globally, policy and business issues will assuredly arise. In our view, these financial innovations represent the new diplomatic frontier of free market capitalism. They are not simply used to conduct capitalism: various forms of capitalism can be embedded within their very architecture." October 12, 2015, D. Talbot, Founder of One-on-One Research
Contact D. Talbot, Founder and CEO
dsimon [at] 1on1research [dot] com