![]() ![]() Thus, the confluence of both (societal) ‘pull’ forces and (digital) ‘push’ forces are propelling digital innovation and the transformation of Caribbean regulators as they seek inclusive sustainable growth. Beyond digitization, developmental legacies and other idiosyncratic pathologies continue to shape this evolution towards differentiation and integration.įor instance, across the Caribbean these pathologies include, e.g., thin and fragmented financial markets and relatively high levels of financial exclusion and economic inertia. While it may be true that innovation usually precedes regulation, in more evolutionary terms, the regulatory landscape is undergoing a systemic transformation in nurturing trust and fostering resilience. ![]() digital currencies) could accumulate over time into systemic changes (e.g., distributed technology ecosystems), which could result in the emergence of novel hybrid species (e.g., central bank digital currency). What may seem revolutionary, if not paradoxical at first hand, increasingly regulators are becoming innovators as they entertain, explore and experiment with the adoption of distributed ledger technologies (DLT), digital currencies (DC), application programming interfaces (API), artificial intelligence (AI), augmented reality (AR), and host of other digital technologies.įrom an evolutionary ecology perspective, what we are witnessing is a form of speciation or ‘polymerization’, i.e., a process whereby small nascent variations (e.g. Beyond money and markets, the codification of trust is a critical inflection point in the evolution of financial services. While regulatory reactions have been ambivalent, ambiguous and oftentimes antagonistic, it would be challenging to think of 21st century regulation without nimble innovation.Īssociated with the rise digital transformation is not only a set of new (distributed) technologies and (shared) institutional mechanisms, but more importantly, the transformation and evolution of certain values, norms, beliefs and cognitions about the nature of money and trust. Whereas monetary and macro-prudential policies have traditionally been the main occupancy of central banks and financial regulators, the recent surge in financial technologies, cryptocurrencies and digital transformation is gradually shaping new regulatory thinking and tinkering. ![]()
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