Copy link
Increase text size
Decrease text size
Link copied

Bank of International Settlements calls for coordinated regulation on big tech firms Facebook, Google, Amazon

“Basel - Bank für Internationalen Zahlungsausgleich-Tower Building” by Fred Romero is licensed under CC BY 2.0

Tue, 25 Jun 2019, 03:59 am UTC

The Bank of International Settlements (BIS) has cautioned that financial services provided by giant companies like Alibaba, Amazon, Facebook, Google, and Tencent could come with new risks for the banking sector as well as some market failures.

The report, which was released after Facebook recently announced its cryptocurrency project Libra, warned that these major companies can “rapidly establish a dominant position because of their large user bases.”

BIS, the oldest global financial institution owned by 60 of the world’s central banks, further explained that the low-cost business models of these big tech firms are highly scalable, and their network structures can help enhance financial inclusion of the underbanked.

Among some of the notable issues highlighted in the report, the risks tech giants pose to financial stability and consumer protection “have the potential to loom large very quickly as systematically relevant financial institutions.”

It also noted that these firms can effectively leverage a “data-network-activities” loop that can fast-track their entry into the financial market. However, although their entry “holds the promise of efficiency gains,” it can also present “new and complex trade-offs between financial stability, competition, and data protection.”

“The very features that bring benefits also have the potential to generate new risks and costs associated with market power,” the report stated.

Given the fact that these tech giants straddle regulatory perimeters and national borders, the report calls for a regulatory action cooperated among national and international authorities to “ensure a level playing field between big techs and banks.”

“The aim should be to respond to big techs’ entry into financial services as to benefit from the gains while limiting the risks,” the report said.

The warning came in a section entitled “Big Tech in Finance: Opportunities and Risks,” in BIS’ Annual Economic Report published on Sunday.

BIS’ report also follows after a study by consultancy firm McKinsey & Company found that retail banks are slow to adopt blockchain technology, citing regulations and conservative consumers as obstacles. It revealed that retail banks remain cautious when it comes to blockchain, noting that their investment banking counterparts are actively experimenting.

<Copyright © TokenPost. All Rights Reserved. >

To leave a comment, please sign in.
More
  • Bitcoin (BTC) $36,642.50 (+1.08%)
  • Ethereum (ETH) $1,257.41 (+0.94%)
  • XRP (XRP) $0.224600 (+0.84%)
  • Cardano (ADA) $0.371500 (-3.70%)
  • Litecoin (LTC) $152.14 (+5.75%)
  • Bitcoin (BTC) $36,642.50 (+1.08%)
Feb 21, 2020 (Friday)
12:01
Paxos launches blockchain-based securities settlement solution with Credit Suisse and Instinet
12:00
Brazil to launch new payment system in response to cryptocurrencies
11:59
Digital currency exchange Coinbase Pro lists Kyber Network token
11:57
Norwegian Air to soon start accepting crypto payments
10:21
Swedish central bank begins CBDC pilot with Accenture
09:51
Italian soccer team Juventus launches ethereum-based digital collectibles with Sorare
Feb 20, 2020 (Thursday)
14:16
Telecom companies complete cross-carrier mobile payments using blockchain
11:53
National Stock Exchange of Australia to develop DLT-based digital securities trading platform
11:00
South Korean ICO project discontinued, to return $7.5M to token holders
10:36
Samsung maintains crypto support in soon-to-launch Galaxy S20
09:41
BIS appoints Innovation Hub heads to lead Singapore and Switzerland
09:15
Coinbase becomes first crypto company to receive Visa principal membership
08:59
Dubai Economy and six banks launch KYC Blockchain Consortium
08:26
Crypto Technicals: ETH/USD under downside pressure after 'Bearish Engulfing' pattern
07:12
Tim Draper buys $1M worth of Aragon Tokens to create digital courts for DAOs
06:13
Renewable energy firm Acciona commits to take CBI’s blockchain-based carbon credits trading platform global
05:02
Crypto Technicals: BTC/USD trades below 21-EMA, break below 4H 200 MA (9386) to trigger further downside
04:56
Crypto exchange Coinfloor to launch a simplified bitcoin buying service
04:35
Indonesia’s customs department joins IBM- Maersk blockchain shipping platform “TradeLens”
Feb 19, 2020 (Wednesday)
12:46
Crypto custodian BitGo acquires digital securities startup Harbor
Subscribe to the TokenPost newsletter!
Don't show me this again today.
Back to top
Copyright ⓒ TokenPost. All Rights Reserved.
PUBLISHsoft