Financial Regulators Need to Rein In Big Tech

The Bank for International Settlements (BIS) is calling on central banks and financial regulators around the world to tighten controls over Big Tech. This comes amid concerns from global watchdogs about the huge amounts of data Big Tech firms such as Facebook, Google, Amazon and Alibaba have as well as how that data could allow them to reshape the financial sector so rapidly that it would destabilize entire banking systems. In fact, we’re already seeing potential destabilizing moves in the payment industry, with Big Tech stablecoins (cryptocurrencies pegged to existing currencies) such as Facebook’s Diem showing how existing payment infrastructures could end up fragmented, much to the detriment of the public good. As such, it is increasingly important for central banks and financial regulators to anticipate developments, formulate smart policies and closely monitor the macro and micro of financial systems.