We all know that the world today was not the same some thousand years ago, and whilst it has changed in almost every way possible, one of the most notable advancements we have had lies in our development of financial institutions and system of trade. From the bartering system some 5000 years ago back to the emergence of the crypto market some years back, technology has been a powerful driving factor for change and is still very much involved in changing the way we handle money at the present time.
Today, money is kept within banks and behind the digital banking applications on our phones, and in the past, the way we stored money, and what we thought of as money, were very different. Items like grains and precious metals held value instead of bank notes and they were stored in temples within certain societies, particularly within Mesopotamia, some 4000 years ago. It was only until some thousand years ago that bank notes came into play, and initial financial practices like lending became common.
Following the industrial revolution in the 17th century, central banks and investment banks emerged, and eventually, they drove economic activity. Whilst the new era of finance brought new prospects, it came with the realisation that financial markets need some level of regulation and this became evident with the stock market crash of the Great Depression that happened during the 1930s. Whilst policies were introduced to stabilise the economy and create a safety net for individuals during times of economic hardship, 2008 saw a housing market crash that took unemployment and debt levels to a great extreme.
Modern financial institutions today offer a vast range of services such as asset management, insurance services, and deposit accounts among many other services, evidence of how far we have come from years ago. What’s fascinating to think is that we’re continuously developing new technologies to digitalise the future of finance.
Nowadays, the widespread use of cashless payments echoes the digital future we’re headed to. With the development of artificial intelligence and algorithmic trading, there may come a time when banks will run entirely on computers, and finance will work in a way unlike anything we know now.
Whilst this kind of future is inevitable, it is worth thinking of its moral implications. What can we learn from the past about change, is it always for the better? Most importantly, and perhaps the most pressing, what of the population and the concerns of unemployment? Can the future of finance be driven entirely by technology? Would human input be worthless eventually, and are we prepared to face that?