TLDR:
- Fintech industry has reached a “bottom” after a valuation plunge, according to execs and VCs at Money20/20 event in Amsterdam.
- Valuations have corrected from unsustainable highs seen in 2020 and 2021, with funding becoming scarce or at lower prices.
The financial technology industry has experienced a significant shift, with executives and investors at the Money20/20 event in Amsterdam indicating that the sector has bottomed out. Valuations have corrected from unsustainable highs in previous years, with the impact of higher interest rates leading to funding becoming scarce or being offered at lower prices than before. The industry has moved towards valuing businesses that can demonstrate solid use cases and business models, marking a shift from the previous focus on bold ideas with little evidence of sustainable growth.
Many attendees at the event noted a lighter footfall compared to previous years, with more productive conversations occurring on the fringes of the conference rather than the main show floor. Despite the challenges faced by the industry, some companies are seeing a potential comeback, particularly in the realm of cryptocurrencies.
Crypto companies such as Ripple and Fireblocks had a notable presence at the event, with stablecoins emerging as a new focus area for digital payments. The industry is recognizing the potential of stablecoins in revolutionizing payment infrastructure, with companies like ClearBank working on stablecoin projects backed by real-world assets.
Overall, industry experts believe that the fintech market has reached a bottom, signaling a new normal for the sector as companies focus on sustainable growth and innovation in a more challenging funding environment.
