By Sumit Gupta, CEO & Co-Founder of CoinDCX explains
The digital evolution accelerating the rise of the metaverse is already having an impact across all sectors from food to fashion, but none more than finance. The move from the centralised, platform-dominant Web2 into the decentralised architecture of Web3 is changing the way fintech is designed and used. Not only will innovation become increasingly rapid, but it will be driven from the bottom up, resulting in financial tools focused on enabling all aspects of our digital lives.
Fascination around the metaverse has gained significant attention thanks to various high-profile announcements such as Facebook’s rebrand to Meta and Bill Gates’ belief that we will soon be working from the metaverse. Yet despite the recent fanfare, Big Tech is following the direction set by crypto innovators into the metaverse,, not leading them. It’s not just the traditional outfits who have got into the game but a growing clutch of agile disruptors and investors in the virtual realm, steering the future of finance.
Collective Disruption
As nascent as the fintech industry seems to be, its origins go all the way back to inventions such as the credit card in the 1950s. However, until now, financial innovations have largely been the product of the main institutional players, like banks and governments. Banking has indeed become more accessible to the masses across the world but within the parameters defined by the institutions that benefit them in cementing market share.
Web3 has changed this dynamic as decentralisation benefits individuals over platforms. While the current internet, Web2, relies on centralised data storage and ownership, the metaverse is underpinned by blockchain technology, where information is stored using Distributed Ledger Technology (DLT) across a wide network. DLT is the hallmark of Web3, giving users ownership over their data and removing the reliance on intermediaries, resulting in more efficient and transparent transactions. The potent technology is a shared and trusted ledger that can be inspected by everybody but no single user has the power to amend it.
This infrastructure has spawned rapid fintech innovation. DeFi, crypto assets, , digital wallets and non-fungible tokens (NFTs) are some of the more popular applications that define today’s Web3. In all these cases, traditional financial protocols have been disrupted by decentralised movements to create new use-cases for blockchain technology. These projects have produced fintech that is not only innovative, but increasingly attractive to a wider base of people, thanks to their border utility.