DLA Piper has partnered with ITN Productions and FINTECH Circle on their Future of Fintech programme which explores the global fintech sector and the opportunities and the challenges within the industry in 2020 and beyond.
Technological innovation in the financial services arena is creating market opportunities to drive growth while enabling both financial institutions and fintech focused technology providers to open up traditionally closed investment markets and deliver their services more effectively.
The accelerating rate of technological change, combined with shifting customer preferences, is impacting the way in which financial services are structured, delivered and consumed, while the regulatory landscape itself is evolving in order to keep up with new financial regulatory transparency requirements globally, which also include anti-money laundering and anti-bribery obligations. This, against a backdrop of rising spend on technology worldwide and stronger confidence in the market, has led to an explosion in fintech investment. Disruptive innovation is occurring across the industry value chain, in such areas as payments and billing technology, trading and clearing, lending, financial information services, retail and consumer banking, insurance, money transfer and remittance, blockchain, artificial intelligence and robotics technology, banking infrastructure, wealth management, security and investor protection, institutional investment tools, digital currencies, crowd funding, and investment platforms.
These same disruptive technologies are driving law firms to offer new technology enabled legal services and additional services that are more in keeping with the current times. As a dedicated partner to the fintech industry, DLA Piper leverages the extensive technology experience of its multidisciplinary, international team to provide integrated legal and technology solutions that help clients navigate the increasingly complex intersection of transactions, technology and regulation. We advise major players across the financial services, telecoms and technology industries including payment providers, fintech platform operators, new model finance providers and other fintech players leveraging disruptive technology or business models.
In the video below, Martin Bartlam, DLA Piper International Head of Finance, spoke with Archax, Revolut and ING on working together to form an innovation ‘ecosystem’ and how technology is changing the financial markets and what this means for the future.
Case Study: Archax
Archax is the first ever digital securities exchange regulated by the FCA in London. Targeted at institutions, Archax also has its FCA brokerage, custody and cryptoasset permissions.
Founded by experts from traditional capital markets and backed by an accomplished advisory board, Archax offers a credible bridge between the blockchain world and the existing investment space. The Archax team is used to working in highly regulated markets and has a deep understanding of the blockchain landscape and tokenisation too – as well as a vision of how to evolve them and open up digital assets to institutions in a transparent manner.
As well as listing global digital issuances, Archax is also developing its own range of liquid digital structured products that will trade on its exchange.
DLA is supporting Archax not only in building its regulatory framework but also by applying DLA Piper’s proprietary AI based regulatory compliance tools (currently under review in the sixth cohort of the FCA Sandbox) to support the issuance of digital capital instruments by the Company.
Case Study: Revolut
Revolut is a fast growing payment services provider developing a more modern and customer friendly consumer payments service.
Founded in 2015, Revolut has grown rapidly - in February 2020, Revolut completed a funding round that more than tripled its value, valuing the company at GBP4.2 billion and becoming the United Kingdom's most valuable financial technology start-up. Revolut enables customers to conduct financial transactions on the move through its mobile app and has the facility for moving money into and out of cryptocurrencies and digital assets.
DLA Piper has been working with Revolut in a number of areas including the terms for customers holding and accessing rights to their digital assets.
Case Study: Pyctor
Pyctor is a novel technological approach to holding and safe custody of digital assets. In order for digital assets to be held and traded in significant amounts (potentially trillions of dollars in financial assets could be more efficiently traded through distributed ledger technology) it is important that users have a trusted system for holding of wallets and controls over how these can be accessed.
ING is leading a group of leading global banks and investors seeking to develop a commercial solution for the holding and protection of digital asset holder accounts and the mechanisms for transmission and trading of digital securities.
DLA piper has been advising the Pyctor team on the regulatory issues and relationships between the consortium members as it brings together the relevant skills and service requirements to enable this to move through the FCA Sandbox with the aim of achieving a regulatory compliant global digital custody solution.