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Everyone is talking about fintech, and they're usually saying good things. Driverless Finance provides a balance to that conversation, exploring the threats that different fintech innovations pose for our financial system. With in-depth and accessible descriptions of new financial
technologies and business models - ranging from distributed ledgers to machine learning, cryptoassets to robo-investing - this book allows readers to think more critically about fintech, and about how the law should respond to it. This book highlights the increased speed, complexity, and coordination inherent in new fintech innovations, and illustrates how these features could come together in a massive financial system failure. It makes the case for a precautionary approach to regulating fintech, erring on the side of
caution to avoid a financial crisis that could have irreversible and catastrophic effects for our society. Because neither longstanding regulatory approaches nor experimental new approaches like regulatory sandboxes were designed to address fintech's systemic risks, this book makes several bold new
proposals for regulation designed to make fintech-inspired financial crises less likely. These proposals include new forms of disclosure and supervision, new forms of technological tools (known as suptech), and a new licensing regime for financial technologies. This book finishes by situating its
discussion of fintech and financial stability in the context of important debates about innovation, expertise, cybersecurity, privacy, competition, and other pressing issues.
List of contents
- Prologue
- Introduction
- Part I: The Case for Precaution
- Chapter 1: The Case for Precaution
- Part II: Fintech Threats to Financial Stability
- Chapter 2: Fintech and Risk Management
- Chapter 3: Fintech and Capital Intermediation
- Chapter 4: Fintech and Payments
- Part III: Regulating Fintech and Financial Stability
- Chapter 5: Current Approaches to Fintech and Financial Stability Regulation
- Chapter 6: Precautionary Regulation of Fintech Innovation
- Chapter 7: The Bigger Picture
- Conclusion
About the author
Hilary J. Allen is a Professor at the American University Washington College of Law, where she teaches courses in corporate law and financial regulation. She has published numerous articles on fintech and financial stability regulation in academic journals and the popular press. Prior to entering academia, Professor Allen spent seven years working in the financial services groups of prominent law firms in London, Sydney, and New York, and in 2010, she worked with the Financial Crisis Inquiry Commission appointed by Congress to study the causes of the financial crisis of 2008.
Summary
Driverless Finance explores the threats that different fintech innovations pose for our financial system. With in-depth and accessible descriptions of new financial technologies and business models - ranging from distributed ledgers to machine learning, cryptoassets to robo-investing - this book allows readers to think more critically about fintech, and about how the law should respond to it.
