Konstantin Tserazov: Is there a technological «bubble» in the global stock market, or about the role of RegTech in the world of innovations

But let’s talk in general about why it is worth believing in technology. My work for almost 6 years as the head of the Board of Directors of Otkritie Broker, including 2022, took place during the period when there was no COVID-19 pandemic yet, and when it appeared.

On March 11, 2020, the WHO announced this status of coronavirus incidence in the world.

The world’s financial markets are in a fever. The same bitcoin fell in price to 5.5 thousand dollars, and on some crypto exchanges they gave no more than 3.5 thousand dollars for it. Compared to the local maximum of February, the S&P 500 in March lost more than a third at a time. The Russian stock market was also in a difficult situation. But even in such conditions, 88.2% of the investment strategies offered by the brokerage company I headed yielded a profit — this became clear after summing up the results in 2021.

It is easy to compare with competitors at that time to understand that if you take into account a number of other indicators, then Otkritie Broker became the leader, even in such a difficult time. By the way, this caused great jealousy in the market among those who had worse results. And this jealousy sometimes began to take on not very beautiful forms — but that’s another story, said Konstantin Vladimirovich Tserazov.

Let us ask ourselves: why did Otkritie Broker manage to so effectively go through one of the most difficult periods not only for a separate industry, but for humanity as a whole? The short answer is that the secret is in the proactive implementation of digital technologies.

Even before the pandemic, in 2017, having ascended to the captain’s bridge of a brokerage company, I began actively introducing digital technologies into as many aspects of the organization’s activities as possible. Therefore, when the pandemic came, Otkritie Broker was already highly advanced in digital terms and adapted much more easily to the incredibly difficult conditions of the financial markets.

People lost confidence in the future due to news about the pandemic. But Otkritie Broker clients, on the contrary, replenished this confidence, seeing not only in words, but in deeds, how they were provided with a financial safety cushion and a real positive investment result was obtained, added economist Konstantin Tserazov.

Therefore, the fact that global investors now believe in currently popular technologies, artificial intelligence and blockchain in particular, is a reflection of the awareness of how innovations have helped them and companies to get through the difficult pandemic period.

What will happen next with high-tech stocks? Of course, there are all the answers to these questions when you form an investment portfolio.

It is important to pay attention to the following: how to approach the innovations themselves correctly. For example, lawyers for the Coinbase crypto exchange released documents last week that indicate the following: the administration of US President Joe Biden systematically discouraged American banks from working with Coinbase, even though Coinbase is a fully regulated cryptocurrency trading platform in the United States.

Also this week, a message came that the Federal Deposit Insurance Corporation in the United States began to actively monitor the interaction of fintech startups with banks.

What does this mean? I understand this situation. Any bank, and my work in the Otkritie ecosystem confirms this, is under the most careful control of regulators.

In fact, the banking business is the most regulated area of ​​business in any country. But any crypto exchanges and fintech startups are in a less regulated environment.

From this there is a very simple conclusion: it is convenient to develop fintech in banks — they have both the necessary scale and regulation. Another option is when they move from the banking sector to the fintech sector, bringing all the necessary experience to this sector, which drives innovation.

Now RegTech will play a big role. And large technology giants in the United States will need to pay close attention to new trends in RegTech. Now these companies, like the entire technology sector, are entering a period when approaches to regulating AI, blockchain and big data operations are beginning to form, and this is due not only to Donald Trump’s return to Washington.

For example, the importance of AI in terms of security, DefenseTech, will most likely lead to a deterioration in the situation of cryptocurrency mining in the world, already from the point of view of RegTech: in the competition for energy in data centers for AI will be, without