Abstract
The analysis of the financial technologies introduction has proved that their application over-complicates the institutional structure of the global financial system. As a result, usual functional relationships cease to operate, new institutes and interdependencies appear, and systemic risks increase. In this context, the system instability increases, resulting in a transition to a new institutional status. The analysis of the financial technologies impact on the stability of financial system shows that the lack of institutional support for new financial technologies is the most important catalyst for the financial industry destabilization and the formation of financial bubbles in various market segments.The ways to reduce the negative impact of financial technologies on the financial system stability (such as development of international prudential standards; revision of the licensing regime for financial companies; “regulatory sandboxes”, which test new technologies, business models and algorithms underlying the Fintech innovations; legal regulation of ownership of digital tokens; and clear definition of the blockchain technology in various areas of life, etc.) have been proposed.
Highlights
The financial globalization of economic systems, the increased number of the global financial market participants and their rapid interaction influenced by modern technologies development lead to the growing institutional complexity of the global financial system
The increased complexity of the system results in higher synchronization between its various parts, strengthening the nonlinear correlations, unpredictable consequences and the accumulation of economic imbalances, both at the national and international levels
After the 2008 financial crisis, the financial industry has actively begun implementing various digital innovative approaches. They have made the basis for financial technologies (FinTech or fintech), i.e. technological innovations in the field of financial services
Summary
The financial globalization of economic systems, the increased number of the global financial market participants and their rapid interaction influenced by modern technologies development lead to the growing institutional complexity of the global financial system. Bouveret (2018), based on economists, market analysts and regulatory in- the analysis of various cybercrimes, developed a stitutions on exploring financial technologies and model to assess cyber-risk for the financial sector. Their impact on various sectors of the economy. Markets believes that the introduction of crypto- transformation is poorly researched, as well as the currency in the future may result in a reduction increase in development uncertainty and the role in the demand for central bank money, which and functions of regulatory institutions during will change the paradigm of government curren- rapid institutional changes in the financial system.
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