FinTech Magazine - April 2022 | Page 45

BANKING

What is the future of forex ? With its popularity continuing to grow , it is entirely possible that blockchain will be the new frontier for forex trading , enabling the platforms and technologies that provide for greater digitisation . And it is this emphasis on transparency where it would potentially offer the greatest benefit .

Unlike traditional forex trading , where deals are facilitated by a broker and there is generally little transparency around trades , blockchain creates a public ledger for each transaction . However , the very nature of blockchain could also prove to be a problem . Blockchain works by storing information across a network of computers , meaning a consensus is required for any changes to be made – this is what has made cryptocurrencies , and more recently NFTs , possible . However , it is possible that this would be a stumbling block for the forex space as it limits the amount of oversight that a regulator would need .

In any case , many believe that the key to advancing the digitisation of forex lies in commercial trades – in helping to further reduce friction , making forex trading quicker and more cost-effective for brokers and more transparent for clients .

DAVID MOUNTAIN EVP – STRATEGY , M & A , ANALYTICS AND PRODUCT , CROWN AGENTS BANK

Eric Huttman , CEO of MilltechFX , says : “ We must focus our efforts on using fintech to help develop the real economy . That starts with the treasurers and asset managers who can face huge operational inefficiencies with their FX setups which directly affect their bottom line .

“ Now is the time to leverage digital solutions to implement widespread and strategic change . If all parts of the financial services industry are to ‘ build back better ’ for their customers , the use of these technologies to establish a more efficient , transparent and cost-effective way of doing things will be vital .” fintechmagazine . com 45