Exploring the Finternet: Pixelpai’s take on future financial technologies

TLDR:
In a series of discussions led by Agustin Carstens of the BIS, the concept of a ‘unified ledger’ and the future ‘Finternet’ were outlined, aiming to revolutionize global financial infrastructure by merging various asset registries into a single platform. Here at Pixelpai, we break down these developments and align our vision of leveraging Distributed Ledger Technology (DLT) and AI to integrate digital markets with traditional finance, pushing towards a decentralized yet stable financial future.

In a keynote speech last year, Agustin Carstens of the Bank for International Settlements (BIS) introduced the ‘unified ledger’ – a visionary digital platform that integrates the monetary system with other financial and asset registries. This system calls for a synergistic public-private partnership, with central banks ensuring the trustworthiness of currency. Its open architecture to be designed to boost financial inclusion and competitive markets, utilizing smart contracts to streamline transactions without intermediaries, potentially lowering costs and enhancing services.

In a chapter of the BIS Economic Report 2023 and a detailed paper in April 2024, Carstens expanded on these ideas, coining the term “Finternet” – a financial internet envisioned to connect disparate financial services seamlessly but in a centralized manner, leveraging ‘unified ledgers.’ The Finternet proposes to break down financial barriers, allowing for swift, secure, and cost-effective global transactions.

PixelPai’s vision for Finternet:
We are inspired by the concept of the Finternet, a network resembling the internet that empowers individuals and businesses by centralizing financial activities. We like the framework ambitions to simplify the financial landscape, making services more accessible and reducing costs, which in turn could significantly boost market efficiency and societal welfare.
The notion of a unified ledger, however, is redundant. While innovative, it does not introduce new benefits beyond current DLT systems, which include blockchain technology. The terminology might serve to clarify the BIS’s vision but also risks creating confusion. It appears that the BIS aims to adapt the benefits of DLT for more traditional financial uses without fully committing to the decentralized model associated with decentralized finance (DeFi).

Our platform embodies the principles of the emerging Finternet and by integrating DLT and AI, we bridge Web3 innovations with the traditional financial sector, supporting users in owning and monetizing their digital identities and assets. While we advocate for decentralization, we recognize the current global reliance on centralized systems and are prepared to operate within this hybrid landscape. The BIS ultimately recognizes the shortcomings of traditional finance and views DLT/blockchain as the future framework for finance, a perspective that Pixelpai endorses.

We hope you found this introduction to the concept of Finternet insightful. We invite industry participants, potential customers, and investors to connect with us as we continue to refine our technologies and expand on the immense possibilities of the Finternet.

Stay tuned for a forthcoming series of articles where we’ll dive deeper into this topic.