What Can Be Called ‘New’ in Finance?

Discussions involving FinTech companies invoke catchword phrases like ‘innovative’, ‘radical’, ‘disruptive’, and ‘new’. But are these FinTech companies merely using new technologies to make nominal modifications to existing models in finance, or are they capable of causing a more profound and fundamental change to our financial system?

This question arises in evolutionary biology. When studying the question of systemic change, biologists distinguish between convergent and divergent evolution. Systems that undergo convergent evolution, yes, do experience noticeable system modifications, but such changes are considered to fall short of the creation of species that can truly be called ‘new’. On the other hand, divergent evolution is defined as the deep transformational process by which selection sifts through useful accidents in a dynamical system to create wholly new beings, now capable of doing new things that previous species could not.

Can there be divergent evolution in finance? What would this look like?

What FinTech companies, if any, are capable of effecting such a transformation?

We have our take on this --what’s yours?