Council Post: How The Combination Of Fintech And Web 3.0 Opens A World Of Opportunities For C-Suite Leaders (2024)

Cofounder/CTO at technosip. Angel Investor, Techstars '18 Alumni, 2x cofounder. Helping startups with strategic technology solutions.

Web 3.0 has been the talk of the cyber world for a long time. It is set to change everything by utilizing cutting-edge technologies like blockchain, the internet of things, artificial intelligence, virtual reality, machine learning, augmented reality, 5G, digital twins, cloud computing, edge computing and so much more.

But do you know what’s even more fascinating? It’s the fusion of Web 3.0 with fintech!

When combined with fintech, the potential for Web 3.0 seems almost limitless. Let’s see how efficient this duo is for the market and what business opportunities they could unlock.

How Web 3.0 Boosts The Potential Of Fintech

Web 3.0 uses smart contracts along with technologies like machine learning (ML), big data and decentralized ledger technology (DLT) to build a more open and interconnected world while retaining the ownership rights of users. It removes the authorizing agencies/organizations from the financial operations, enabling transparent peer-to-peer transactions between users.

For fintech, these traits of Web 3.0 are a blessing in disguise, as they result in:

• Improved operations - With the arrival of Web 3.0, all digital financial services—such as payments, money transfers, loan sanctioning, lending and investment—will complete faster. So, fintech organizations can automate manual processes and offer a better user experience.

• Security - Though permissionless, Web 3.0 uses biometric traits of users and has better security deployments. So, financial institutions can enable tighter security for transactions through ATMs, payment apps, credit/debit cards and so on. With the Web 3.0 world, we will experience a passwordless world. Companies such as Hypr, Keyless.io, and Transmit have already started offering a combined approach to improve security and usability by leveraging biometry and integrating many different use cases for employees and customers.

• Reduced cost of operations - Web 3.0 encourages storing data in decentralized locations, promoting the optimal use of resources. It improves the availability of data/nodes, thereby optimizing the cost of data storage and data-fetching operations.

• Optimized customer journey - Artificial intelligence and machine learning can “learn” from users’ actions and automate more processes than a Web 2.0 solution can ever do. As a result of this automation, automated learning paths and automated suggestions, fintech institutions can better optimize the customer journey for their users.

• More payment/investment opportunities - Web 3.0 is more focused on the execution of daily-life operations via the internet. From selling services to selling NFTs and everything beyond, it multiplies the opportunities where money can be sent and spent online. For Fintech, it undoubtedly means more business and more investment opportunities.

How Fintech Boosts The Potential Of Web 3.0?

The two technologies are complementary. So, not only does Web 3.0 enhance the potential of Fintech, but the reverse is also true. Let me explain how.

• It sits at the core of Web 3.0 - Decentralized finance (DeFi) can be considered a vital component of Web 3.0. Though based on blockchain technology, DeFi is the brainchild of fintech experts, enabling a smarter finance internet infrastructure for all.

• Innovative fintech solutions for a powerful Web 3.0 - Web 3.0 is still in its infancy state. It has a long way to go, and innovative fintech solutions will lead the way for the same. Fintech will eventually bring the finance sector out of the hands of authorities and make it more user-centric, as the semantic web promises to be.

The Business Opportunities For You

If you are in the fintech business, embracing Web 3.0 and empathizing on building the semantic web more powerful through your innovations will unlock unlimited business opportunities. But even if you are not, the Web 3.0 and fintech combination will provide many benefits:

• Improved user experience - Automated workflows (powered by machine learning) and uninterrupted peer-to-peer transactions are two main features Web 3.0 and fintech-enabled solutions will inherit. The decentralized nature of content in the semantic web will ensure that all user requests are processed faster, and navigation is super smooth.

• An opportunity to build a higher level of trust - Your customers’ data is held in decentralized storage, with them being the sole owner of it. These customers can decide the access rights and make the selling decisions related to the data they own. This implies that people won’t fear that sharing their data with a business will result in its selling to third parties—like they (and we) do today.

• More marketing opportunities - NFTs are popular these days. They are the non-interchangeable units of data that can be sold and promoted. But did you know that businesses have begun incorporating them into their digital marketing strategies? For example, you can associate a virtual product with it, promote the related NFT and divert the related traffic to your business/e-commerce site to boost your sales.

• Smarter ways to provide support and deliver user education - You can enable ML-based user journeys to educate your users where they are stuck. Adding chatbots or suggestions will help them quickly figure out what they want to know. For a business, it will result in fewer support inquiries and higher sales/engagement.

• Removal of mediators means higher profit - Web 3.0 is about improving transparency and removing intermediaries, so it will be advantageous for businesses and customers. Removing the mediator/manual processes will reduce the cost of service. As a smart business, you can divide the profit between yourself and your end-users and develop a low-cost service while increasing your revenue.

The Impact Of Web 3.0 On The Fintech industry

Web 3.0 is the main focus of 2022 for all kinds of businesses. It has the potential to benefit enterprises, SMBs and future ventures.

For fintech businesses, things are more attractive. It is time to be more innovative and create the next disruptive solution for the semantic web. The combination of Web 3.0 and fintech could prove to be a game-changer for other types of businesses.

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