Fragmentation of Finance
In this chapter, we will cover the technological changes that are currently challenging the status quo in finance. By delving into the technical aspects of Blockchain and Fintech, a clear perspective of the transformational effects of these technologies, that emphasises the role of the Blockchain as a unifying factor will be evident. This will provide a holistic understanding of the implications of these technologies, how they are effectively fragmenting the financial sector and thus enacting a paradigmatic transformation. Special importance is given to explaining why it is necessary to include the fragmented financial market when constructing macroeconomic models, which is not the case today. In essence, it underlines that the structure of financial markets is in a state of flux, and as a result, shows why we require a new construct that is capable of leveraging the convergence of technology.