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  • Writer's pictureOlga Bavrina

On the Verge of the Era of Global Compliance 🌏 ⚖️

The area of digital payments is woven of contradictions. Entities and individuals demand speed, transparency, affordability, and a nice UX. At the same time, they want payments to be safe, reliable, and controllable. Every emerging innovation is built upon a regulation gap or ambiguity, but exactly this gap is the way for fraud and scams, and the issue of a regulation to cover it is only a matter of time.

Innovation and Its Younger Sibling Regulation

World justice practice is built on end-user interests advocacy, especially if it’s an individual. This idea, fair in its intention to protect ordinary people from business sharks, gives opportunities for fraudulent minds.

As a reaction to it, regulations emerge at the same speed as innovations. Ban of binary options, DGPR, and KYC requirements are just a few examples of countless regulations that make launching a fintech business more and more complex.

Federation Countries 🇺🇸🇮🇳🇩🇪🇧🇷🇦🇷

Union-like countries (the US being only one example) have the additional challenge, because they have two levels of authority, and sometimes it’s hard to tell which has the highest priority. For the US, domestic payments from one state to another have already become a challenge from a compliance standpoint [1]. But it’s not solely the US tendency - all the countries consisting of relatively independent jurisdictions, sooner or later will introduce decentralized regulations on the state level, as a result of unfolding business expansions.

Unitary Countries 🇫🇷🇵🇱🇰🇷🇹🇷🇿🇦

The countries with single-level regulation for domestic payments are not in sufficiently better condition though. They often participate in united economic zones that have zone-level regulations, the EU being just one example. The need for cross-border payments within a zone means regulation on the country of transfer origin, in the country of destination, and on the economic zone level.


The tendency of innovation-fraud-regulation cycles is fundamental. However, some of the techniques and principles of the iterations can become more innovative. We at PartnerAlly anticipate fintech compliance modernization in different forms. Following are only several examples of what could happen shortly:

Proactive Regulation Gap Identification

This would allow governments to go in front of innovation and prevent fraud. AI and data learning models can be utilized for this purpose. And this is much needed since fraudsters could also go in the same direction

Smart Law Collision Elaboration

Overlapping and contradictory laws optimization and elaboration. Advanced digital systems have to come in handy to untwist existing regulations regularly. Each new law should be systematically researched so that it doesn't complex things once introduced.

Global Crypto Settlement

2023 showed that many jurisdictions aim at full legalization and regulation of cryptocurrency rather than a ban. After a technology boom, followed by crypto winter (approx. 2018 ~ end of 2022), it seems to be finally reaching a balanced position [2].

Innovative Compliance

Investment in the digital verification of companies and customers is gaining momentum as one of the proactive fraud prevention methods. Block lists and information exchange, somewhat hindered by privacy regulations, will become more and more valuable over time. Co-pilot validation systems are something to keep an eye on.

Embrace Compliance

As revolutionizing fintech matches the planet, compliance is marching in step. The elimination of regulation gaps and grey zones will accelerate. Embrace the compliance best practices, even if today it seems there’s an option not to. This option will not stay long.

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