China’s torpedoing of Ant Group Co.’s initial public offering is the most dramatic example yet of the financial frictions emerging globally as fintech upstarts invade the territory of central banks and closely-regulated traditional lenders.
While the eleventh hour suspension of Ant’s record-busting IPO has more than a hint of Chinese internal politics about it, it also reflects the global struggle by regulators to catch up with the pace of innovation.
Wake-up calls from Facebook Inc.’s Libra currency project to the collapse of Germany’s Wirecard AG are forcing that urgency.Agustin Carstens, general manager of the Bank for International Settlements, laid out that challenge this week, saying that while the industrial revolution took a century to create structural change in economies, advances in technology have done so in a matter of years.
“We have moved from big tech being too small to care, in a few years they moved to being too large to ignore, and now we’re at a point of them being too big to fail,” he told the Hong Kong Fintech Week forum on Nov. 2.
