In a speech delivered on April 12 at the LendIt USA 2016 conference in San Francisco, John Williams, President and CEO of the San Francisco Federal Reserve, spoke about the potential benefits and pitfalls of fintech technologies as well as digital currencies.
In his speech, the FED president said that many fintech technologies hold the keys to solving many “long-standing challenges” and that advances in payment technologies can open the doors of the financial system to “economically disadvantaged communities”.
Williams also spoke about how the big data industry can leverage its expertise to combat money laundering and terrorist financing in the financial system, “Advanced data analytics could provide powerful tools to increase both the efficiency and efficacy of these efforts.” said Williams.
However, the majority of his speech focused on the potential issues that the sector may bring, specifically highlighting the risks of digital currencies:
“The other side of that coin, of course, is that, left unbridled, the ease and anonymity of some types of fintech, such as digital currencies, have the potential to make criminal and terrorist activity even easier.”
The speech made no mention of the possible benefits of digital currencies. Williams concluded his speech by reinforcing the need for adequate regulations for fintech innovations and stated that a “level playing field” was necessary for maintaining the efficiency of the financial system.
Williams said in his closing remarks:
“As a matter of principle, if it walks like a duck and quacks like a duck, it should be regulated like a duck.”
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