Venture Capital, Fintech Startups, and Digital Finance: The Coming Tidal Wave of Industry-Redefining Innovation

The financial services industry is on the cusp of its most transformative decade since the commercialization of the internet. Venture capital is fueling the rise of AI-native fintechs, digital identity platforms, and tokenized financial ecosystems that promise to upend traditional models. Instant payments, programmable money, and agentic AI are reshaping everything from lending and fraud prevention to wealth management and cross-border payments. But with this tidal wave of innovation comes unprecedented challenges: how do financial institutions strike the right balance between speed and security, compliance and creativity, disruption and trust?

This super panel discussion brings together venture capitalists, fintech executives, bank executives and management consultants to explore the future of venture-backed fintech innovation, its impact on all stakeholders in digital finance, and the biggest opportunities and challenges ahead. Panelists will examine where capital is flowing in 2026, which technologies will define the next wave, how banks and fintechs can collaborate without compromising resilience, and what governance and risk frameworks must evolve to keep pace.

Transcription:
Transcripts are generated using a combination of speech recognition software and human transcribers, and may contain errors. Please check the corresponding audio for the authoritative record.

Holly Sraeel (00:08):
So I have the pleasure of doing cleanup for the day with this panel before we have a reception. I would ask everyone to try to summon the last of their energy—it has been a long day—because I have really fabulous speakers here. We are going to talk about important subjects that will become industry defining. So let's get started. I don't need to introduce myself anymore today, but to my left, White & Case's Ladan Stewart, global head of FinTech and a partner in the firm's global white-collar investigations practice. To her left, Edward Jones's Pooja Daswani, general partner. Going down the line, PwC's Amanda Cox, partner, and finally MasterCard's Raj Seshadri, Chief Commercial Payments Officer. All right, so let's get started. The financial services industry is on the cusp of a major transformative decade, the most significant since the commercialization of the internet.

(01:13):
Half the room doesn't remember the commercialization of the internet. Those of us of certain expertise level do.

(01:21):
But this change is going to be something dramatically bigger in ways we can't even imagine yet. Consider the following: Venture capital right now is fueling the rise of AI-native fintechs at an unprecedented pace. Digital identity platforms to combat fraud are popping up right and left. Instant payments, programmable money, and agentic AI are reshaping everything from lending and fraud prevention to wealth management and cross-border payments. Digital assets and tokenized financial ecosystems are just a few of the innovations that promise to upend traditional models. I would argue we're going to see the reinvention of the traditional financial services industry as we know it. With this tidal wave of innovation comes unprecedented challenges. How do financial institutions strike the right balance between speed and security, compliance and creativity, disruption and trust? There have been some strong signals coming out of Washington that suggest we're entering a new phase of transformation in financial services that's been ushered in primarily by the White House.

(02:31):
The President's Digital Assets Executive Order is an indicator of regulatory acceptance. I would like to get each of your takes on the regulatory acceptance in Washington and how it's going to continue to affect AI, tokenization, and stablecoin usage.

Amanda Cox (02:49):
I'm happy to take that one first, Holly. I feel like there was a panel earlier today where somebody said "risk and compliance, boo." Well, I'm the "risk and compliance boo" person. But I think we're actually in what I would characterize as a renaissance of regulatory oversight. I believe that we will continue to see that broad push for innovation coming not only from Washington DC from a political perspective, but also from the regulators. You will hear the tone that the risk of not innovating is actually greater than the risk of innovating at this point. I really think we're in for a much more amenable regulatory environment and probably will be for the next few years at least to drive innovation.

Raj Seshadri (03:31):
I'll speak as a business person, not as risk and compliance. I think regulation provides clarity. It gives you the confidence as a company and as an individual to enter the market and to try different use cases. The clarity it provides is great. The technologies you mentioned, like stablecoins, provide choice to consumers and businesses. For example, we have a cross-border service business that's already up and running in near real-time, moving money in 150 currencies across 200 countries, and we can reach 95% of the world's bank population. If you take that and add stablecoins to it, I think of it as another currency. We're enabling it so that if you're a consumer, a small business, or a business that wants to reach anyone, you can use stablecoins as well.

(04:20):
In that way, it's transformative. Crypto Secure is a score we provide that measures the risk in a transaction. These are all things that in a multi-token network are possible because we can imagine a different way of doing things.

Pooja Daswani (04:38):
Let me try to round that out, Holly. I lead branch operations for Edward Jones. As the resident operations geek here on stage, what a time to be alive for those of us who've lived through the past 20 years with KYC, AML, and all the different changes in the industry. The flywheel for me is really the combination of AI, tokenization, and then the regulatory acceptance—all of that finally becoming real for us. We've been waiting for this moment. The example I see come to life a lot is if you think about AI-led fraud on tokenized rails with embedded compliance; that's all a real thing. Multi-jurisdictional AML/KYC can be real with all of these enabling capabilities.

Ladan Stewart (05:37):
I'm the resident lawyer in the bunch, so much worse than risk and compliance. I think what I find most interesting is exactly the regulatory change. I was at the SEC during the last administration and worked on a lot of crypto matters. The tone at that agency and across the federal government is markedly different now in terms of the approach to these technologies and the impetus to regulate them so that the marketplace has more clarity. What I find the most interesting thing to happen out of the SEC this past year is that last month they launched what's called "Project Crypto."

(06:37):
The chairman of the SEC, Paul Atkins, described Project Crypto as a move to find a way to bring our financial markets on-chain. I think that's something that a year ago would've been unimaginable—that a regulator would actually think about tokenizing and bringing securities and other things on-chain. I think there's so much that will happen in the coming months and years to try to put that vision into reality.

Holly Sraeel (07:15):
We've talked a lot over the past eight hours about tokenized deposits, stablecoins, and programmable money. Their very existence and acceleration is changing the definition of financial services. How do you see that definition changing now? How would you define the industry today?

Amanda Cox (07:37):
I feel like we've got great representative roles here: legal, ops, risk and compliance, and the business. I think there's still work to be done to truly get to that precipice of redefining financial services, but we're on the journey right now. Simply said, the way I think about it is faster global transactions and more secure transactions. To tie things to the earlier conversation, it's really opening the doors to investing in pieces of things that were not possible before we had this type of technology.

Raj Seshadri (08:16):
It expands our addressable market and the things that we can do. It makes more things possible that add to what we're already doing today. An example would be our multi-token network. As these assets come on-chain, you have to facilitate transactions on-chain. We have the ability to facilitate on-chain payments, bridge to off-chain, and connect interoperability between different "islands" that are forming so you can actually have an ecosystem develop. All of this extends what financial services can do and brings many new use cases that expand the market for all of us.

Ladan Stewart (09:01):
I would add that the SEC has talked about creating what are called "super apps"—one platform for users and investors where you can lend, borrow, trade, and stake your crypto. This would streamline the regulatory process so that if you're registered with the SEC, that might be sufficient for you to do all of these things with securities, commodities, and all types of assets. If we do end up getting to this place of the super app, that really could fundamentally change things.

Holly Sraeel (09:52):
We'll have to come back and talk later about the super app and the embedded risks there. But let's continue this on-chain finance discussion. What role do you think central bank digital currencies (CBDCs) will play in catalyzing the emergence of on-chain finance or constraining it?

Amanda Cox (10:13):
If you look at the signals in the US, I think we're a bit of a ways off from a central bank digital currency. That being said, if we get into an arms race or see other countries racing more quickly to do it, that could obviously change. As for whether it will spur or constrain innovation, if there's too much control or it's too centrally managed, it could constrain things by funneling everything through that central bank funnel. Otherwise, if it provides greater infrastructure and speed, it could actually spur innovation. It could really go one way or the other, but in the US, we might be a ways off unless a competitive trigger spurs it.

Ladan Stewart (11:17):
I would add that outside the US, there is definitely a lot of interest in CBDCs. One reason for that is that over 95% of stablecoins right now are US dollar-backed. A lot of governments view CBDCs as an alternative to US-backed stablecoins.

Holly Sraeel (11:40):
Of all the things we're talking about—AI, stablecoins, tokenized deposits—how do you think institutions are prioritizing them?

Raj Seshadri (11:56):
We work with a variety of technologies as they emerge. When I think across that spectrum, the one we spend a lot of time on is broadly AI. We've been in AI for a couple of decades now. A few years ago, people were talking about Gen AI, and now they're talking about agentic AI. AI as a technology enables things to be smarter and stronger. For example, we've used it in our financial functions for a long time. It can forecast FX and settlement risk, improve liquidity, and make things more secure. We put a "safety net" into our network a long time ago to find anomalies, and that has stopped about $3 billion in fraud over the last three years. With agentic AI and personalization, it makes even more things possible.

Pooja Daswani (13:29):
I have to agree with you, Raj. I know there are reports that 80% of AI projects aren't necessarily generating business value, but I have conviction that they will. You can see a direct line from what the technology can do for delivering value to customers. I think we're past the adoption hurdle—people are already using it. Now we're onto the impact hurdle. In pockets like fraud and customer service, you're starting to see that already, but I don't even think we know yet how it's going to change enterprise value.

Holly Sraeel (14:18):
It's clear it's going to have a huge impact across the enterprise. Pooja, you've talked about how the relationship between Fintechs and incumbents is changing and that there's going to be greater clarity about plumbing and infrastructure. Do you want to talk more about that?

Pooja Daswani (14:53):
We used to talk about fintechs as disruptors and institutions as incumbents. That has changed to be much more of a partnership. There's a classic line in VC: it's either the incumbent that innovates fast enough or the disruptor that finds distribution faster. I think that's changed; both can win if you partner fast enough. Incumbents can innovate, and fintechs can do things you otherwise wouldn't have thought of. The smartest founders have found a way to plug into the system versus trying to disrupt it.

Raj Seshadri (16:02):
I couldn't agree more. Incumbents bring scale, trust, and deep knowledge. Fintechs bring new ways of doing things that incumbents may not have the ability to experiment with. When it succeeds, it's often the combination that works for scaling.

Ladan Stewart (16:31):
I'll just add that when it comes to crypto and blockchain, it's a little bit different because regulators are considering things like innovation exemptions or safe harbors specific to these companies. Traditional financial institutions wouldn't necessarily be able to take advantage of those. Regulators will have to deal with that as they figure out the landscape.

Holly Sraeel (17:30):
Crypto companies have been making the rounds in Washington. Brian Armstrong, Coinbase's CEO, has invested millions to influence regulation. But crypto companies also know they need TradFi, which is why they are looking for these partnerships. Shameless plug: we're getting ready to launch American Banker On Chain, a new community dedicated to digital assets. Regarding crypto companies applying for bank charters: they may not realize what they're getting into, whereas TradFi understands highly regulated compliance.

Amanda Cox (18:39):
We are seeing many applications for charters. Our advice is: do not rush the process. A poor application will not move through the system quickly. You want a charter based on feasibility and data—you don't want a charter you can't fulfill on the backend. Regulators are becoming more open to conversations, but being a regulated entity is a very different environment. I don't know that all these companies are ready for that, though there seems to be an openness to grant charters more rapidly, as we saw with Arabon last week.

Holly Sraeel (19:58):
Is there a greater focus on infrastructure—rails, custody, compliance—over consumer-facing innovation right now?

Raj Seshadri (20:14):
I don't know if it's a "greater" focus. Innovation comes in waves. At different stages, the focus shifts between infrastructure, use cases, and security. These all grow as the ecosystem grows.

Pooja Daswani (20:42):
We were very focused before on the "shiny app." Now we've shifted to creating value through being fully interoperable. We're seeing more focus on B2B2C—helping other companies serve their customers in different ways.

Holly Sraeel (21:22):
How should institutions be assessing the long-term potential of this innovation?

Amanda Cox (21:48):
Success will be measured based on actual outcomes. What solution are you bringing to the market, and are you achieving it? Investors want to see cases with meaningful AI embedded and they are looking for things that are better, faster, and cheaper. They are also looking for embedded risk and compliance if a regulated entity is going to use it.

Pooja Daswani (22:55):
It has shifted from "how many users do you have?" to "who trusts you?" and "what are your integrations?" Being a trusted node in the network is more valuable than direct downloads.

Raj Seshadri (23:23):
In the payment space, we see the wonderful digital experiences from consumer payments now moving into the B2B space. The commercial payment space is incredibly exciting right now. There's a massive shift where ACH and checks—which are still prevalent—are moving toward digitized, card-triggered experiences.

Holly Sraeel (24:28):
Where does the industry stand in the process of building the plumbing and infrastructure that TradFi can deliver at scale?

Pooja Daswani (24:57):
At Edward Jones, we have a venture capital arm with about 12 companies. We look for ways to give time back to our advisors so they can serve clients better. If you come at it with the humility that you don't need to build everything yourself, you can partner with firms that are doing it faster and better.

Holly Sraeel (26:06):
Will this collaboration define new standards for digital asset infrastructure?

Amanda Cox (26:22):
Absolutely. Traditional institutions need to be careful about who they partner with. You must ensure your partner has the right risk and compliance standards. It is your responsibility to make sure they aren't creating undue risk for you or the financial system.

Raj Seshadri (27:33):
Standards are critical because they allow interoperability. They prevent "islands" from forming and allow for scale across the entire landscape.

Holly Sraeel (28:04):
How will AI-driven compliance tools affect the speed of product development?

Raj Seshadri (28:12):
It helps a lot. We often have to do regulatory scans country by country. You can automate a lot of that with AI so humans can apply judgment more efficiently. Similarly, compliance can be baked into digitized processes, like automating expense management policies directly into a travel app.

Amanda Cox (29:33):
We've come a long way, but there's more to be done in terms of proactive, preventive monitoring once people really harness their data effectively.

Ladan Stewart (30:00):
Keep in mind that right now in the US, there is no real federal regulatory framework for AI—just a patchwork at the state level. This could change if regulators decide to create standards.

Holly Sraeel (30:26):
How long will that take?

Amanda Cox (30:29):
I don't think there's any rush.

Ladan Stewart (30:34):
The focus right now is on crypto. They might turn to AI afterward. If a new administration comes in and creates frameworks after AI is already widespread, that could create issues.

Amanda Cox (31:08):
Everyone already has a responsibility to oversee their models under existing standards. Also, we are always one "event" away from pushed regulation. If something doesn't go well at scale, we will see more requirements.

Raj Seshadri (31:32):
As a global company, you have to define your own tolerances and governance to remain consistent across different regulatory frameworks.

Holly Sraeel (32:05):
There's bound to be an incident, right?

Amanda Cox (32:16):
History tells us there will be. My hypothesis is that it might be a cyber event rather than an AI-related one, but we don't know how far AI will advance in three years.

Raj Seshadri (32:43):
That means governance and proactive thinking about ethical AI are vital.

Holly Sraeel (32:57):
If you could bet on one trend defining the next three years, what would it be?

Amanda Cox (33:11):
AI for me, but I'll also say we must keep an eye on quantum computing.

Ladan Stewart (33:30):
AI, with tokenization as the runner-up.

Holly Sraeel (33:48):
Tokenization for me, because AI will be embedded within it. How will success be measured differently—interoperability, network effects, or user growth?

Raj Seshadri (34:29):
It will be measured on whether it allows you to do things better and faster. Does it improve the outcome and make the user experience seamless?

Holly Sraeel (34:51):
What advice would you give banks to avoid being left behind?

Pooja Daswani (35:08):
Have a "learn-it-all" mindset, not a "know-it-all" mindset. Invest in data and interoperability. Think of compliance not as a SharePoint document, but as code.

Raj Seshadri (36:16):
Technology is just technology; what matters most is culture. You need a culture that fosters experimentation while maintaining guardrails.

Holly Sraeel (36:52):
What is the next "invisible" infrastructure layer we aren't paying enough attention to?

Amanda Cox (37:03):
Data cleaning—people aren't moving fast enough to make data fit for purpose. Also, the possibility of more participants getting "skinny" master account access to the Federal Reserve's payment rails.

Raj Seshadri (37:51):
Embedded finance, especially in the commercial space. Virtual cards are programmable tokens that carry data and AI, and embedding them into ERP and procurement platforms is very exciting.

Holly Sraeel (38:25):
Any questions from the audience? If not, I'll make a couple of predictions. In the next three years, we will see more innovation in the digital asset space than we are prepared for. TradFi holds more power than they know—they are skilled in the areas crypto people are not, such as payment rails and regulation. In a time of global instability, TradFi's "trump card" will be trust. Please join me in thanking Ladan, Pooja, Amanda, and Raj.