Oliver Camponovo: Why integrate the ESG factor into your business model

OLIVER CAMPONOVO INVESTMENTS ESG - Would you trust a company that doesn’t care about employee welfare, gender equality or fair pay policies? Would you invest in a chemical company that makes no effort to mitigate its environmental impact?

Investments also look to the green

In recent years there has been a growing focus on issues related to the environment and human rights, which has also led to a radical change in the financial and investment market.

Companies are asked to take more and more responsibility for their "impact" and to make it as positive as possible, getting to the point, from investors, to evaluate organisations not only on the basis of financial performance but also on the basis of non-financial criteria and the way they manage their risks and opportunities.

In addition, the greater sensitivity to this issue is found in Millennials and Generation Z to the point that some financial analysts and investment managers offer advisory or investment lines dedicated to these factors.

But what is an ESG investment?       

ESG stands for Environmental, Social and Governance.

Socially responsible investment dates back to the 1960s, when investors began to avoid companies with negative reputational factors (e.g. companies involved in the South African apartheid regime). Much has been done since then, and in 2015 the United Nations officially set 17 Universal Goals for Sustainable Development.

Investors are increasingly applying these non-financial factors as part of their investment analysis and selection process and, while ESG metrics are not mandatory in reporting, More and more companies publish specific data on ESG factors.

ESG investments towards SRI

The ESG investment was born from the Socially Responsible Investing (SRI) philosophy while there are fundamental differences.

SRIs typically use negative value judgements and screening to decide which companies to invest in while ESG investment seeks to find positive value in companies that apply socially responsible principles.

The SRI filters and excludes from the portfolio holders companies that do not meet certain criteria while the ESG opts for realities defined "impact" based on the three related areas:

• Environmental factors (Environment), refer to the company’s behavior on issues related to resource depletion, climate change, waste and pollution.

• Social factors (Social), are related to the company’s treatment with respect to people, workers and local communities, including health and safety issues.

• Governance (Governance) factors, refer to corporate governance and policies, including tax strategy, corruption, structure, pay.

Why integrate the ESG factor into your business model   

It is clear that social responsibility is a topical issue at any level (financial, regulatory, etc.) and, regardless of the legal requirements, it is an issue that should be addressed within your organization.

Because many investors are incorporating ESG factors into the investment process, integrating sustainability elements into your strategy can definitely impact your revenue.

This requires a change of mentality: ESG must be considered an investment rather than a cost because it allows to obtain various benefits, between which a greater trust in the market and a better reputation.               

But does the ESG factor generate an excess return for investors?

You can’t become an ESG champion overnight           

It takes time to enhance its culture and create a dedicated team to invest in long-term initiatives to drive shared value creation.

ESG organizations try to avoid short-term and low-cost thinking.

Instead, they imagine the cause and effect of corporate actions and capture stakeholder-focused value creation opportunities while avoiding stakeholder-related risks. Shareholders continue to thrive even if not at the expense of employees, customers, suppliers, the community or the planet - and usually over a longer time horizon.

Therefore, even the studies that analyze the ESG factors in the analysis of a possible over or under performance are difficult to grasp all the aspects of this new company philosophy and certainly in many cases the added value of an ESG culture is not yet reflected in the share value.

To date, not all scientific analyses and publications support the idea that ESG factors always lead to better equity returns. There are many variables at play, including simple elements such as time and the fact that not all stock exchange operators are good stock exchange operators.

However, a significant amount of research suggests a positive correlation between companies that do well and companies that do well financially - and by extension, are good for shareholders.

At the same time, there is not a single study that proves otherwise.

So, if ESG factors are likely to be positive and, at the very least, not detrimental to business performance, then why shouldn’t investors want to invest in companies looking to make the world a better place?

Switzerland's tax handling of cryptocurrency

TAX HANDLING CRYPTOCURRENCY - Switzerland has a distinct advantage in establishing and expanding FinTech business models, such as DLT-based services. Switzerland has evolved into an innovation hub for developing technology-based financial solutions as a well-established, leading financial center with an investor-friendly tax and legal environment. This is also due to the Swiss government's and legislators' quick actions to enhance the legal and regulatory climate.

The path of cryptocurrency tax treatment

Several regulatory provisions have been in place since 2017 to allow FinTech business models to be created in a technology-neutral environment, with measures appropriate with their size and dangers, while always keeping public interests in mind. FinTech enterprises have limited prospect of long-term success if clients and the functioning of financial markets are not protected.

This is also valid for taxes. Unlike several of our neighboring nations, such as France, Swiss tax legislation does not provide any special provisions for cryptocurrency at the time of writing. As a result, the taxation of these digital assets will be based on existing legislation and tax authority practice based on the similarity of tax consequences of other assets.

This essay will summarize the critical elements of cryptocurrency taxation in Switzerland. It's important to remember that Cantonal Tax offices may also have slightly different practices and that every tax case is unique.

Tax handling of cryptocurrency: Taxation strategies

The Federal Department of Finance (FDF) has been revising Swiss tax legislation in light of rapid advancements in blockchain technology and the new problems brought by cryptocurrencies. It released a report (in French) in June 2020 that outlined the potential need for tax law reforms to deal with developments in distributed ledger technology.

The FDF looked into whether changes to income tax, wealth tax, VAT, withholding tax, and stamp duty was necessary. However, the investigation judged that the existing Swiss regulations were adequate. On the one hand, the current legal framework supported by authorities in practice can account for the vast majority of situations encountered. On the other hand, the existing quo ensures that Switzerland remains a desirable location for cryptocurrency innovation and investment.

Similar activities have taken place on a global scale. For example, in October 2020, the OECD published a paper on virtual currency taxation that provided a country-by-country summary of tax treatment. However, this document merely addressed generic, non-binding factors that public policymakers should consider when considering cryptocurrency taxation.

While there are no intentions to change Swiss tax law, a proactive strategy is nevertheless required. Potential future tax concerns for individuals and professionals may only be predicted by closely watching technological advancements.

So let's deep into taxation.

What exactly is a cryptocurrency?

Cryptocurrencies are decentralized, peer-to-peer computer networks that generate encrypted and virtual money. Blockchain is the most well-known network of this type, validated by "miners." Users who make IT resources available to ensure transaction security are miners. They are in charge of the blockchain system and ensure that the transaction user genuinely owns the cryptocurrency. This operation referred to as "mine," is carried out using sophisticated mathematical equations and is remunerated by the system's creation of cryptocurrency.

There are various sorts of cryptocurrencies

To figure out how a cryptocurrency is taxed, we must first determine how it is classified in Switzerland. Based on FINMA (the Swiss Financial Market Supervisory Authority) guidelines, the Swiss Federal Tax Administration (FTA) has identified three types of cryptocurrency:

• Native tokens: These can be used to make electronic payments and do not provide the issuer any rights. These are "pure" cryptocurrencies like Bitcoin or Ether, and they are the subject of this article.

• Asset-backed tokens: these tokens are issued as part of an issuer's initial coin offering (ICO/ITO) and include issuer rights. They can be debt obligations that require the issuer to pay the holder interest and even give the holder voting rights under company law.

• Utility tokens: these tokens are also issued in conjunction with a funding round. Unlike asset-backed tokens, they do not give the bearer any ownership or payment rights. They give you the only right to use an electronic service that runs on a blockchain platform.

READ ALSO ---> Discovering meme tokens with Oliver Camponovo

Native tokens have their own set of tax regulations.

Cryptocurrency holdings and certain capital gains must be declared on your tax return in Switzerland. You must consider the declared value and the cryptocurrency's origin to ensure that they are accurately declared. Whether they came from the taxpayer's personal or company fortune, they will be taxed differently.

Tax handling of cryptocurrency: Income Tax

The first thing to remember is that capital gains from a private wealth asset are tax-free. This regulation also applies to bitcoin capital gains. As a result, realized gains deriving from the sale of cryptocurrency are not taxed. Any losses incurred as a result of the sale of cryptocurrency assets, on the other hand, are not tax-deductible.

However, there are several circumstances in which cryptocurrency is not considered part of a person's private wealth. When cryptocurrency is earned through self-employment, it is considered business wealth. When virtual money is employed in ordinary trading, this is the case. How can you tell if your cryptocurrency is part of the regular trading market? There are several criteria, the most important of which are:

• Use of leverage,

• After fewer than six months, the cryptocurrency is sold.

• In any calendar year, a total volume of transactions that exceeds five times your total assets at the start of the tax period

• The requirement to raise funds through cryptocurrency transactions to compensate for lost revenue.

However, we should stress that only a thorough examination of your circumstances will indicate whether or not your activity qualifies as that of a professional trader.

Every Canton has the authority to decide whether or not a person's cryptocurrency transactions are considered self-employed. Furthermore, each Canton has a different tax treatment. Given the authorities' discretion, it is recommended that you seek legal guidance from an expert if you want to conduct any significant transactions.

Taxation and AHV

This is a crucial issue because it might significantly influence your assets. Taxation and AHV (old age and survivors' insurance) are the main drawbacks of the company wealth classification. All gains are taxable if the bitcoin transactions are considered business-related. Unlike profits derived from private wealth, these gains can no longer be deemed exempt. Furthermore, because bitcoin is virtual security, any securities (physical or virtual) activity deemed business-related is likely to include cryptocurrency activity by definition and vice versa. AHV contributions, on the other hand, can be deducted from realized cryptocurrency gains because they are computed based on actual income flowing from business wealth. There will be an increase in business costs as a result of this. And what about the bright side? Those who own cryptocurrencies as part of their business assets can deduct any realized losses and any value decreases!

The main question for blockchain miners is whether mining is done as a self-employed activity. If this is the case, the cryptocurrency received is taxable as self-employment income. Because they are considered company assets, any capital gains derived from their disposal will be taxed.

It's worth noting that mining categorization is a point of contention in Switzerland. The Cantons of Bern and Zurich, for example, have decided that a miner's work is always regarded as self-employed. In contrast, the Cantons of Zug and Lucerne assess the nature of such activity on a case-by-case basis before making their decision.

In the case of self-employment or cryptocurrency trading, taxable income is comprised of cryptocurrency obtained through mining on the one hand, and realized capital gains arising from the business wealth on the other, i.e., realized gains from the sale or purchase of cryptocurrency after short-selling it.

Tax handling of cryptocurrency: Wealth tax

Cryptocurrencies are considered things that can be valued and traded under Swiss tax law. As a result, they are assets subject to wealth tax. The tax rates differ from one Canton to the next.

Each year on December 31, the Swiss Federal Tax Administration determines the taxation value of the most widely used cryptocurrencies. Bitcoin, Bitcoin Cash, Ether, Litecoin, and Ripple are among them. When declaring virtual assets, taxpayers must relate to this taxation value. If the FTA has not assigned a value to a cryptocurrency, the asset holder must report the value as of December 31 using the platform's value. The taxpayer must declare the purchase price if the platform does not allow the user to determine the value of the virtual currency.

Business wealth is valued for tax purposes in the same way as private wealth is valued, i.e., according to the taxation value of the currency on December 31 of that year.

Asset-backed tokens have their own set of tax laws.

The civil law relationship between the investor and the issuer determines the tax status of asset-backed tokens.

If the holder earns interest on their investment, they must pay tax on it in the same manner that a taxpayer who receives interest on other investments does. In a similar vein, the issuer's payment of benefits to token holders computed based on a portion of profits is deemed taxable income from wealth.

The same regulations apply to capital gains tax deriving from asset-backed token transactions for native tokens.

The rules for wealth tax are the same as they are for native tokens.

Utility tokens have their own set of tax laws.

The civil law relationship between the investor and the issuer impacts the tax treatment of utility tokens.

If these tokens grant access to a service, there is no taxable income, and no payment is made to the token holder.

Utility tokens follow the same regulations as native tokens regarding capital gains and wealth taxes.

Correctly declaring  your assets in Switzerland and the use of a Voluntary Disclosure

What are the benefits of adequately declaring cryptocurrency? Because any taxpayer who fails to report their assets risks receiving an additional tax assessment as well as being prosecuted for tax evasion. The latter procedure could result in a punishment ranging from a third to three times the tax owing.

It's important to note that this option is only available once, and it doesn't imply you'll be able to avoid paying taxes or interest for late payments. However, once in a lifetime you declare your undeclared cryptocurrency wealth and income (and other if any) through a voluntary disclosure, you can escape the fine. The tax authorities must have no prior knowledge of tax evasion to be qualified for this procedure. The taxpayer must completely cooperate with the authorities in determining the amount of tax owing and paying it back.

READ ALSO ---> The boom in cryptocurrencies rises to 3 trillion

Discovering meme tokens with Oliver Camponovo

MEME TOKEN OLIVER CAMPONOVO - In recent years, the rise of cryptocurrencies and blockchain technology has been inevitable. October 2021 was an exciting month for all cryptocurrency investors, as the price of bitcoin skyrocketed to $67,000, and Ethereum quickly followed suit. The most notable event, however, is another.

What you need to know about Meme token

In recent years, the rise of cryptocurrency and blockchain technology has been unavoidable. October 2021 was an exciting month for all cryptocurrency investors, as the bitcoin price skyrocketed to US$67,000, and Ethereum quickly followed suit. The most notable event, however, was the Shiba rose, which stunned the entire cryptocurrency community. Shiba quickly overtook Dogecoin's ninth position in marketcap, and investors made every effort to keep the meme coin crown. As a result, meme coins have quietly dominated many significant cryptocurrencies.

So, Oliver Camponovo, what's the big deal, and why are meme token making headlines? What exactly are meme coins? Is it coins, memes, or memes about coins? What's the deal with SafeMoon, Shiba, and Dogecoin?

Memecoins, also known as meme tokens (crypto assets that can purchase coins), are digital tokens inspired by popular sarcasm, social media puns, jokes, and memes. As a result, their concept is primarily derived from the internet. There are currently around 130 meme coins in the crypto market. Meme coins differ from traditional cryptocurrencies in that they are created without a specific goal or reason. Dogecoin was the first and most popular meme coin. It was created in 2013 as a parody, but it is now one of the most successful cryptocurrencies.

Even though their initial reputation was created as a joke, meme coins have done quite well in the cryptocurrency arena. People have already made a lot of money from these coins.

The only difference between a meme coin and a crypto coin is that meme coins do not currently have a utility like Bitcoin or Ethereum, designed to solve real-world problems. That being said, some meme coins are doing great things other than being memes, such as earning dividends. Dogecoin, for example, can be used on both a Mastercard-backed card and BitPay. It allows you to spend the coin wherever Mastercard is accepted, just like any other currency. There is a good chance that Tesla will accept Dogecoin as payment very soon!

How powerful can meme coins become?

Currently, predicting the future of meme coins, like all other cryptocurrencies, would be difficult.

At the moment, Dogecoin is the only original and largest meme coin. To understand its value, consider comparing it to Bitcoin, the first and original cryptocurrency and the most valuable at the moment. Dogecoin reached its peak in May 2021, with a value of $0.74 and a market cap of more than $35 billion. It is currently trading at $0.27. As a result, it is incomparable to other meme coins. SafeMoon is now worth $0.00000508 and has a market cap of $40 billion.

Shiba Inu is currently ranked third among the most popular cryptocurrencies, with Doge and Coinbase ranking 13th.

What's important to know here is whether Dogecoin users are selling out into Shiba. That could be a ruse to raise the price, and they may be able to repeat this trick in the future with a new token. So far, this remains an open question.

So, what makes these coins so valuable when their face value is less than a pound?

Memecoins are accessible to almost everyone, which means that as their value rises, so will their volume. Alternatively, as demand rises, so does the price. As a result, meme coin owners are well aware of how they can profit from them.

So, Oliver Camponovo, does this mean that meme token will take over the crypto market and make you rich?

Memecoins have the potential to work in parallel with traditional cryptocurrencies, personally I do not see them replacing in any way traditional crypto coins! To be realistic, there is always the possibility that they will fail. On the other hand, if you invest a pound in these coins and skyrocket in value, you could become a millionaire. SafeMoon, Shiba Inu, Dogecoin, and other cryptocurrencies are good examples of this. In addition meme coins mey be the driver of the young generation into the blockchain world and a link between blockchain and metaverse!

Meme coins can be used for a variety of purposes, including:

In theory, meme coins can replace existing payment mechanisms such as Paypal and bank transfers, and a few shops already accept them. We are very likely to start paying our bills with Shiba Inu instead of dollars through PayPal soon.

The key takeaway, as well as which meme coins are doing well:

Shiba Inu is a legitimate meme coin that is doing quite well in the market at writing. This coin's value increased by 60 million percent in 2020, reaching an all-time high, and it's dropped quite a bit since then. However, when compared to where it started, it has made significant progress.

Floki is another new and not-so-popular meme coin that is currently holding the grip, and it is now at 20.8 percent. Elon Musk's Shiba Inu inspired the coin.

However, keeping in mind that these coins are doing well right now does not mean that they will continue to do so. In this industry, anything can happen at any time. In any case, you must research before selecting or dropping any coin on any cryptocurrency.

Disclaimer: This is not a piece of investment advice. Do your research and eventually ask for advice from tax advisors and legal professionals in the function of where you live.

To discover the banking and fintech trends of 2020, click here

Oliver Camponovo: The following Century will belong to Asia

OLIVER CAMPONOVO - Asian economies are expected to lead the next phase of globalization once the pandemic fades. More than two dozen "unicorn" start-ups have emerged from the Indian subcontinent this year alone. Asia's expanding global prominence has long been dominated by China, and Asia's continued rise in the twenty-first Century is becoming a much bigger phenomenon. The Asian Century is evolving into a fully realized regional narrative. Starting now, we are beginning to witness the complementing features of different Asian countries coming together. This is an exciting time.

Consumerization

That a region that in 2000 only represented a third of world GDP in purchasing power parity terms has changed dramatically. According to a McKinsey study, Asia might control up to half of the global GDP by 2040.

According to a separate estimate, Asian consumers will account for about half of global consumption growth over the next decade. Asia is predicted to have half of all upper-middle-income families and half of all international transactions.

Why is Asia leading the next chapter of globalization? Which industries will be the most dynamic in the future years?

Rapid industrialization analyzed by Oliver Camponovo

One motor is the region's continued industrialization, which has seen China become the world's most giant manufacturing powerhouse.

By 2018, China accounted for 28% of global manufacturing output, ten points ahead of the US. In 2018, manufacturing provided about 30% of the country's total economic output. While that trend is likely to continue, other Asian countries, particularly India, Thailand, Malaysia, and Indonesia, are rapidly industrializing.

As labor prices rise in established manufacturing hubs like China, low-wage countries step in to relieve some pressure.

As China's labor costs rise, supply chains for apparel, shoes, toys and electronic assembly are shifting away from the country to South and Southeast Asia countries. They are not always visually appealing, but they do bring employment and economic progress. The manufacturing sector in India still accounts for less than 15% of the country's GDP.

Urbanization in a hurry

Urbanization is another prospective growth driver in Asia, offering higher income and economic development than rural agriculture jobs. That expands and deepens the middle classes. For example, just 35% of India's 1.4 billion people live in cities, compared to 60% in China. Vietnam and Indonesia, with respective cities of 37% and 57%, have similar growth potential.

The most dynamic industries in the future years would be IT, consumer discretionary, and healthcare. Taiwan and South Korea already dominate the semiconductor business. This will only increase as the global economy becomes more digital, a new generation of digital-native employees emerges, and remote working becomes more popular.

China is already the world's largest producer of solar cells, electric vehicles (EVs), and battery storage for EVs and other electrically driven machines and devices. China's supremacy in the sector will be brutal to challenge given its size and extensive manufacturing platform.

In terms of consumer spending, the post-Covid-19 reopening of trade will spur short-term demand, while China's commitment to pushing through its "common prosperity" agenda will spur long-term demand. It's all about the middle classes, and that will help the consumer-discretionary sectors.

Additionally, Covid-19 has changed people's perceptions of health and wellness. Many people have become more concerned about their health as a result of the pandemic.

Lingering worries by Oliver Camponovo

Still, the future of Asia's growth is uncertain. One focuses on regulation, particularly changes in China's business policies. In this year's technology crackdown, the government restricted many of the country's largest technology enterprises.

Concerns about Asian companies' ability to transition to a low-carbon economy and the credibility of their ESG-related accounting are rising among worldwide investors as ESG investing takes center stage.

Transparency is essential. If we want to reach carbon neutrality, businesses must adopt this rule of thumb. Despite these challenges, the region's growth appears assured. Asia, rather than America, will likely dominate this Century.

To discover the banking and fintech trends of 2020, click here

Analysis of the future of finance and blockchain with Oliver Camponovo

FINANCE BLOCKCHAIN OLIVER CAMPONOVO - The only thing that comes to mind when we hear the term "Distributed Ledger Technology (DLT)" is "Bitcoin." Bitcoin is merely a small fraction of the massive DLT pool, which will astonish you. Other examples of public DTL technologies are Ethereum and all the EVM chains that have allowed for smart contracts and the development of an entirely new Decentralized Finance infrastructure.

But, first and foremost, what is a Distributed Ledger Technology?

DLT is a technology that has the potential to alter the financial services infrastructure. It provides increased transparency, efficiency, decentralization, automation, cost savings, and other benefits. It will serve as the cornerstone for the financial services infrastructure of the future.

Financial services reimagined

By next year, it is expected that 80 percent of banks will have started initiatives on both public and private DTL. However, there are still many obstacles to overcome because formal legal frameworks do not yet exist, which can be a stumbling block in large-scale adoption. Furthermore, updating the entire financial infrastructure via DLT takes a significant amount of time. Finally, the top DTL resources are unavailable on the market and difficult to obtain.

The question here is whether the investment in DLT is worth all of the hardship.

The solution is straightforward! It enables parties to digitally transfer assets without the use of a "middle" party. Yes, indeed! It is well worth the hype, as it allows for transparency and autonomous business rule execution. Yes, indeed! It's well worth the effort. It reduces risks, speeds up and simplifies transactions, simplifies dispute resolution, and performs binding agreements in real-time. That is why the pain of modernizing financial infrastructure is worth it for DLT

.

Many improvements can be achieved:

So, what should financial services companies do now?

Given the massive amount of change that DLT will bring, now is the moment to recognize that there is still much work to be done. Companies must conduct cost-benefit evaluations and develop roadmaps. Legal and regulatory tax guidelines must also be worked out between the financial industry and the government; in Switzerland, the Parliament recently authorized such a new legal infrastructure, making DTL application easier.

Global Payments:

Because DLT offers lower fees, real-time settlement, and rules, it has the potential to flourish in the future of global payments.

Global transactions are currently complicated and expensive, with several steps to complete a process. Manual and repetitive operations are common. The payments are cleared through local clearing networks. Payments are also delayed by weeks and are occasionally refused if the corresponding bank fails to meet certain conditions. Similarly, each party's identity and re-verification takes a significant amount of time.

All of these obstacles can be overcome with DLT. To begin, there exist digital identification profiles, which are sufficient for quick verification. Currency conversion is also simplified, and authorities have access to transaction data.

As a result, DLT is more cost-effective because it eliminates the need for human resources and correspondent banks.

El Salvador, for example, recently created such a system and went even farther by declaring Bitcoin to be legal cash, allowing anybody to receive and send Bitcoin. The economy of El Salvador is still founded on remittances from outside, and the saved commissions of roughly 400 million dollars will be saved by the people and reinvested in the country. Are you shocked that El Salvador's economy is booming?

Processing of commercial property and casualty claims

It is now possible to lower the risk of fraud using DLT. Thanks to distributed ledger technology (DLT), which can help to speed the claim submission process by utilizing smart assets. It is possible to reduce processing time and eliminate unnecessary procedures. With the use of records, any fraudulent action can be quickly discovered.

Not only that, but DLT can make it easier to integrate credible data sources, reducing the need for manual labor.

Syndicated Loans:

Syndicated loans pose a risk of a single customer borrowing a considerable amount. Usually, the lenders are in the form of groups as the borrowing amount is enormous. Once again, the record-keeping functionality of DLT can make this process easy, effective, efficient, and risk-free.

Participation of financial institutions in syndicated loan opportunities can be made more accessible with DLT.

Trade Finance:

Every year, around $18 trillion of trade involves finance! DLT can boost trade efficiency by streamlining the processes involved in trade, such as capital efficiency and faster settlement. It also minimizes the risks as all records are trackable.

“And this is only the start of a global revolution that will shake the foundations of financial infrastructure.

Only those economies, politicians, managers, and individuals that begin to use this technology will be able to stay in the game. Even dinosaurs have gone extinct, so start learning and adapting.”

To discover the banking and fintech trends of 2020, click here

Is the hype about Metaverse for business worth it? This is Oliver Camponovo

METAVERSE BUSINESS - Welcome to the grid of always-on virtual spaces where you may mingle and interact in ways you never thought possible! Welcome to the Metaverse, the augmented reality cloud, the mirror universe, and the three-dimensional Internet. It's coming, and it's going to be massive!

The new "buzz" in the market is "metaverse," which is hitting the Internet like a wave and capturing the interest of the tech and business industries. The Metaverse is gaining traction where one of the most popular online sites is rebranding to promote this futuristic concept.

What exactly is METAVERSE?

Metaverse can be thought of as a "virtual habitat." Virtual reality headsets, smartphone apps, augmented reality devices, and other gadgets are used to create online spaces of interconnected virtual communities where humans may interact more realistically and meet, work, and play outside of traditional ways of communication.

The word "metaverse" is derived from "meta," which means "beyond," and "verse," which refers to "universe." As a result, it relates to a virtual world separate from the actual one, in which physical commodities such as land and buildings can be transferred for digital cash. Humans can now explore places, make friends, buy things, develop virtual assets, and even attend virtual events in this new "world."

The entire "pandemic scenario" and lockdown tactics have elevated the Metaverse notion even more. More audiences are exploring the virtual world for leisure and business due to remote working regulations and the "work-from-home trend." It has created a plethora of commercial options.

While Metaverse can be interpreted in various ways, three key features are presence, interoperability, and standardization. Interoperability refers to the movement between virtual worlds with avatars and other digital things, and presence refers to the experience of being in the virtual world. Interoperability of services and platforms across the Metaverse is built on the foundation of standardization.

Why is METAVERSE important in business?

With the future of Metaverse in mind, major corporations such as Google, Apple, Microsoft, and Facebook are already planning to embrace it ahead of their competitors. There's no denying that the Metaverse has the potential to revolutionize our culture, society, and politics. Nonetheless, it has the potential to create new industries, innovative social networks, improved gadgets, and new consumer behavioral patterns and patents.

Because of the way Metaverse works—blockchain technology—businesses can significantly profit from it. It's nearly impossible to tamper with a record after it's been made and added to the chain because of its decentralized database shared across networks of computers. This system maintains the integrity of data and eliminates the possibility of fraud.

When it comes to real-world use cases, the entertainment business is most important for customers to use virtual reality. The entertainment business will significantly gain from the Metaverse, from training to developing new products and services.

Tokens that aren't fungible (NFTs)

NFTs represent virtual assets such as films and photographs. Users who are registered on blockchains own these virtual assets. It makes it possible to trade and accumulate NFTs as digital assets. Businesses employ NFTs for promotional purposes as well as to monetize their assets. Popular brands like Louis Vuitton and Nike have expressed interest, opening up new marketing and promotion opportunities. Coca-Cola produces and sells these memorabilia as well. It suggests that NFTs have the potential to become a tool for business owners to take advantage of the Metaverse's growing possibilities.

The Metaverse can assist enterprises in a variety of ways, many of which are yet to be discovered, but which include:

The Metaverse can transform customer and company relationships:

By providing additional locations for potential customers and improving their involvement with their products and services, they can expand their market. Sotheby's Metaverse, an online marketplace where clients may purchase NFT art, is the best example.

In the Metaverse, corporate interest is fast growing. The entertainment sector is capitalizing on this opportunity, and online games are evolving from simple video games to a vast universe, and Roblox and Fortnite are the best examples.

On a traditional scale, Metaverse can allow new currencies to enter the market

Businesses can now sell their services on a whole new and distinct marketplace as blockchain cryptocurrencies gain popularity. The best feature of Metaverse is its decentralized nature, which allows people to make decisions rather than having them made for them from the top down. This decentralized character is a key sign of how new currencies will develop and how new businesses will operate. Companies can now use the Metaverse to implement their business strategies and concepts. This trend will continue to improve as cryptocurrencies become more widely recognized and integrated into society.

Metaverse can bring new conversational tools to improve and simplify teamwork

The Metaverse provides new modalities of collaboration and teamwork for commercial firms, in addition to monetary incentives. During the epidemic and shutdown, there was an upsurge in meeting cooperation over Zoom, which was handy but also limited. Metaverse can help close the gap by combining the convenience of online conferencing with the efficacy of in-person meetings via virtual conference rooms.

Are there any risks for enterprise businesses in the Metaverse?

At the time, there were two major hazards associated with Metaverse adoption. The first is the unpredictability of blockchain technology's future, and the second is the threat of cybersecurity. This and any other hazards associated with Metaverse and other blockchain technology should be monitored by businesses and corporations.

Take-away

Metaverse has the potential to be a game-changer in the modern corporate environment, where data science, virtual reality, and artificial intelligence dictate the rate of growth, profit, and productivity. However, by transferring our entire lives to a purely virtual platform, Metaverse will raise the traditional cybersecurity threat to a new and more serious level. Metaverse, without a doubt, allows us to escape the confines and limitations of the physical world. However, the shift is still ongoing, and there is still plenty to learn.

To discover the banking and fintech trends of 2020, click here

Oliver Camponovo: Four megatrends that will transform the world

OLIVER CAMPONOVO MEGATREND - Looking to the future requires a certain knowledge of the present, traits of trend-following, and an understanding of possible perturbations. With that in mind, I tried to identify four megatrends of change.

Four megatrends in works that could transform the way businesses operate in the future

Economist John Kenneth Galbraith joked: "The main role of economic forecasts is to make astrology appear credible". And he was right. The fact that economic and financial market forecasts function in a complex adaptive system is one of the reasons why they are so risky. A modest change in a tiny component could significantly affect a completely different system at a completely different time and place. That’s why I spotted four megatrends.

One or more of the four pillars will have a favorable or unfavorable impact on businesses. These four pillars will demand consideration and investment in business strategies. As investors, we must consider how one or more of these four pillars will impact the businesses we own and how corporations will manage these concerns.

The four megatrends identified by Oliver Camponovo

What can I say about it that hasn't already been said by everyone? Our lives have become increasingly reliant on technology. Students' online classes, mobile games, the rise of e-sports, and 101 apps for every possible activity are now a part of our daily lives.

The Metaverse comes next. With a VR headset, you might be able to fly to Alaska without ever leaving your couch or complete your online shopping by walking around a virtual store and selecting products.

Companies will become increasingly reliant on technology, not merely to stay ahead of the competition but also to survive! The more qualified a business is at utilizing technology, the more competitive it will be.

The Paris Agreement of 2030 and other similar agreements will compel countries to regulate climate change agents and take corrective measures. China has already taken steps in this direction by prohibiting chemical factories and other polluting enterprises, which is expected to become more of a trend. More rich and developing countries will be pushed to do so when the actual cost of climate change (more weather disruptions and natural disasters) becomes apparent.

Better sanitation, clean water, and clean air will be priorities for governments and corporations. We've already seen the start of it. Increasingly stringent emission standards for automobiles and the resulting switch to cleaner fuel and electric vehicles; extensive water treatment and desalination plants; rainwater harvesting efforts; solar and wind energy adoption, and a slew of other initiatives are all gaining traction around the world.

We also see a push for biodegradable items, plastic bans, and recycling, as well as the right to repair (something new for the developed world, but something we've been doing for a long time!).

People throughout the world seemed to appreciate the importance of health and wellness while trapped indoors due to a pandemic. People and governments worldwide have failed to contain the pandemic, and the scars will take a long time to heal. As a result, governments, corporations, and individuals are expected to place a greater emphasis on healthcare spending.

This would encompass the entire range of health and wellness, including diagnostics, online consultations, e-pharmacies, online health records, medical insurance, and preventive health care. Mental health has become a topic that people openly discuss, and this sector may receive much more attention. These businesses would benefit from a tailwind for the next few decades.

With the battle lines formed between China and the Western world, a Cold War 2.0 is a distinct prospect in the coming years. It has already begun. Global firms will be obliged to de-risk their sourcing and wean themselves off of their reliance on China as a sole supplier. Global supply networks may need to reconfigure to limit and eliminate the dominance of a single point of failure.

On the other hand, China Plus One is more than just a reduction in reliance on China; it is a complete rethink of decades of super-efficient supply chain policy. As corporations develop inventory and build in some slack in their supply lines to deal with unforeseen events, the just-in-time delivery model will likely take a back seat.

Manufacturing is going back to developed nations as labor costs become less and less critical in the overall scheme of things, thanks to increased automation and the use of technology. Furthermore, we see an increase in global nationalistic fervor. Politicians will be more likely to encourage enterprises that create jobs in their nations, even if it means sacrificing optimal efficiency.

To discover the banking and fintech trends of 2020, click here

Oliver Camponovo: Inflation is rampant, and the SNB is dozing off

OLIVER CAMPONOVO INFLATION - Everything is rising in price: electricity, food, automobiles, and taxes. The free money, not the pandemic, is to blame, and Jordan and his associates aren't content with it. The SNB is up against a huge obstacle. It risks inflation, an interest rate shock, a real estate crisis, and a financial catastrophe if it engages in the currency market. If it does not, it may be able to keep inflation from spreading into Switzerland. The franc, on the other hand, would most likely skyrocket.

Analysis by Oliver Camponovo on the inflationary situation

Every day, more terrible news about rising costs demonstrates how serious the threat of inflation has grown.

The September value of the US CPI was released the day before yesterday (a monthly value of 0.4 percent, compared to 5.4 percent in the same month last year), and the September value of the PPI producer price index was released yesterday (a monthly value of 0.5 percent, compared to 8.6 percent in the same month last year).

If a significant deflation was feared a year ago, the "narrative" is now continuously changing. "It's because the economy is reopening," "it's because of high energy prices," "it's because of supply restrictions," and so on. They don't seem to know what story to tell or what to do, in my opinion—neither in Switzerland nor other countries. If we want to summarize the situation, we may say that the macroeconomic vision has failed.

In almost every case, the epidemic is blamed in some way for inflation. Price hikes and inflation are caused mainly by central bank money supply expansion, which is rarely mentioned.

After the lockdowns, central banks dramatically extended their financial sheets, coinciding with a drop in output and services. More money equates to fewer items and services, as well as higher pricing. Isn't it logical?

Oliver Camponovo and inflation in Switzerland

Since the beginning of the year, inflation in the eurozone and Germany has been substantially higher. The eurozone's annual inflation rate is currently at 3.4 percent (estimate September 2021, Eurostat). It is considerably higher in Germany, at 4.1 percent since 1993, and more than double the ECB's long-term aim of 2%.

Thomas Jordan and the SNB are unconcerned about such matters, and they see no cause to alter monetary policy. In a nutshell, they believe:

But, in an open economy, how can Jordan be so confident in himself? When it comes to inflation and consumer pricing, can Switzerland entirely insulate itself from the rest of the world?

Certainly not. In a 2017 study paper, the same SNB determined that foreign influences are the primary drivers of Swiss inflation, suggesting that the SNB's present position contradicts its study.

The same study indicates that a stronger Swiss franc can help prevent inflationary imports and a situation similar to that of 1973-1974.

However, it appears that the SNB is unconcerned with inflation today. Inflation is mentioned only once in the current Financial Stability Report (September 2021) in the case of an extreme "interest rate shock" scenario. Growing inflation rapidly pushes up interest rates around the world. As a result, economic growth slows considerably, and real estate prices plummet.

BNS talks too little about inflation

Is that the end of it? It's amazing how seldom the SNB talks about inflation in public, even though any logical economist would consider it a significant risk.

I honestly hope they're simply playing poker with us and that inflation is being thoroughly monitored and analyzed behind closed doors. We already see it with commodity prices, utility rates, and food shortages in the real world.

According to the SNB, the most substantial damage from an interest rate shock would be on domestic Swiss banks, which would suffer from under-collateralization of their mortgage loan portfolios and losses on nominal and unpaid interest. It's a horrible situation. And, while everything appears to be for the time being, how close are we to an "interest rate shock" scenario?

Inflation is continuously rising in the United States, the eurozone, and Germany. Is there a risk of a "spillover," and what are we doing about it? Is it possible to hide the truth from the general public? Or, even worse, supposing that this horror won't affect us because we're the best in the world?

Oliver Camponovo proposes two interventions to address inflation

The matter, in my opinion, should at the very least be discussed, with two possible SNB interventions:

(a) Reduce or eliminate foreign exchange market actions to reduce or eliminate inflation imports. The Swiss franc exchange rate would be set solely by the market from now on, resulting in a (significant?) increase of CHF against EUR and USD. But what will happen to the SNB's strong financial position? Will their assets and dividends to the cantons paid to complete their mismanaged balance sheet be depleted?

(b) Intervention continues, and inflation is imported from abroad, resulting in an "interest rate shock," a real estate crisis, and possibly a banking crisis in Switzerland.

The second option, in my opinion, is the more likely. What role will Swiss politics play? Will they safeguard their banks (as they have always done), or will they protect the SNB and its asset portfolio?

In whatever form it takes, inflation in the United States and the eurozone appears to represent a more significant threat to Switzerland than the SNB now acknowledges.

That’s how Oliver Camponovo talked about inflation in April, https://finanzeinvestimenticriptovalute.it/en/inflation-is-coming-protecting-cash-and-deposits/

Oliver Camponovo: Banking and Fintech Trends for 2022

OLIVER CAMPONOVO BANKING FINTECH - The epidemic of the coronavirus has expedited the development of digital banking and Fintech. New trends are emerging as the need for digital finance solutions grows and changes to an increased digitalized world and economy. In the banking business, as in other industries, technology is assisting in the acceleration of advances.

If you work in finance or are interested in learning more about anticipating 2022, you've come to the right spot. Oliver Campono with this article examines the top four banking and Fintech trends for the next year.

 Oliver Camponovo: Top 4 Banking and Fintech Trends for 2022

Decentralized finance is a popular topic that is gaining support. It focuses on transforming the industry by utilizing emerging technology. Decentralized finance's principal goal is to gain favor. It provides out-of-the-box solutions by operating outside of the traditional financial system.

Intermediaries are eliminated with decentralized finance, and finance is effectively democratized for the majority. Decentralized finance strives to modify and make financing accessible to a large percentage of the population who do not have access to it.

The most excellent part about decentralized finance is that it functions outside of the banking system's strictures. By eliminating investment, payment, and bank intermediaries, it brings financial services to the public. Instead, it uses services backed by a blockchain network to replace them.

Blockchain offers a viable option. It will continue to disrupt the financial ecosystem to assure security and transparency while eliminating the dependency on traditional financial service providers. To operate as the digital middlemen needed to move money, blockchain relies on smart tokens and contracts.

Artificial intelligence and machine learning are another banking and Fintech trend to be aware of. AI and machine learning have benefited a variety of services, including digital marketing. As a result, it's past time for the financial sector to follow suit.

AI/ML technologies enable businesses to better monitor customer behavior and spot opportunities and abnormalities, from regulatory technology to robot advisers. Future financial actors, such as Fintech firms, will rely on data scalability.

Unlike traditional banks, which handle consumers as a group, Fintech firms offer highly customized, personalized services by merging technology and human abilities in the most effective way possible.

Regulations and policy, algorithmic trading, banking chatbots, and fraud detection are all areas where AI/ML will be helpful. The technology can assist banks because it aids in the fight against terrorism financing and money laundering.

The market for decentralized finance is predicted to rise tenfold over the previous year. Growth has been exponential, implying that it will likely continue for many years to come.

Insurance, financial data, asset management, decentralized exchanges, and lending are projected to be the most affected areas.

In addition to those mentioned above, predictive analytics is a banking and Fintech trend that will dominate 2021. Predictive analytics will play a critical role in preventing fraud and strengthening cybersecurity measures as cyber-security remains one of the financial industry's most significant concerns.

New entrants and small businesses can use predictive analytics to gain an advantage over larger enterprises. Predictive analytics uses machine learning, algorithms, and big data to analyze and assess the likelihood of future events based on client behavior.

The future of data science will be powered by predictive analytics. Fintech companies are using technology to achieve scalable, efficient, and cost-effective results.

Predictive analytics also aids the industry in improving customer experience, identifying methods for staff to provide value, and streamlining operations.

Predictive analytics can handle a variety of tasks, including capacity modeling. Predictive analytics will continue to improve and uncover new ways to detect and address problems before they occur.

Finally, the politicization of financial health is unavoidable. It's a growing trend on which more people are concentrating their attention. Because 2020 and 2021 have been difficult for businesses and people alike, financial health will be a significant concern in 2022.

On the other hand, the governments are quickly catching up by demonstrating their commitment to a brighter future. Financial health issues have previously been extensively discussed in the Fintech business. The next year, the focus will be on the low-income class and wealth redistribution.

The financial industry and the government are anticipated to establish new programs to assist clients in gaining access to financial goods to meet everyone's financial needs.

Furthermore, growing difficulties such as job security and an unstable economy are projected to lead to customers demanding their rights. As a result, this year will be full of obstacles.

Conclusion

The banking and Fintech industries are both growing at a breakneck pace. Significant changes will occur next year. There is a lot to look forward to, from the introduction of microservices to the politicization of financial health.

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