As Stripe’s Valuation Drops by 64%, Where Should FinTech Companies Focus Next?

Stripe is one of the most well-known online payments processing platforms. While there are many benefits associated with this product, it has not been immune to a fair amount of recent market volatility. As TechCrunch notes, there are several reasons behind a recent devaluation of 64 per cent. Two prominent concerns involve fears in regard to discretionary spending as well as rising interest rates.

When we consider that these observations seem to be pervasive throughout the FinTech sector, an important concern arises. What options do companies which rely upon streamlined payment processing have? It is a good idea to take a closer look at this question in order to gain a better understanding of where the entire industry may be headed. 
Striking a Balance Between Efficiency and Security

Stripe and its closest competitors (such as Plaid) offer several benefits to companies which regularly host online transactions. Here are some of the most prominent:

  • Fraud prevention
  • Financing options
  • Dedicated POS systems
  • SaaS platforms
  • Integrated mobile applications

The issue here does not necessarily involve the validity of these services. It is instead associated with the perception of the FinTech sector as a whole. When we then take into account increased competition from similar startups such as Finix, it becomes clear that the entire landscape is changing. So, where should companies look next?

Cutting-Edge Payment Processing Solutions

Certain industries (such as online casinos) have always appreciated the benefits associated with efficient online transaction systems. Not only are users able to complete transactions in seconds, but security is never taken for granted. This is obviously important when we consider the rising risks of data fraud and phishing. However, we are also beginning to witness an important paradigm shift in regard to how the transactions themselves are being performed.

Notably, one of the only subsectors within the FinTech sector that has performed rather well in recent times is associated with cryptocurrencies. Crypto-powered transactions boast several advantages that can be difficult to achieve when using other methods. These include:

  • End-user anonymity
  • Lower fees and commissions
  • Streamlined EULA contracts
  • Funds can normally be accessed nearly instantaneously

The only remaining question involves whether FinTech companies are ready to take the first step into this decidedly massive domain. However, it is important to note that any uncertainty is likely to be offset by the fact that the popularity of cryptocurrencies is on the rise. In other words, these payment methods are likely to become even more popular in the coming years.

Of course, crypto-powered payment options are only one solution available to firms within the FinTech sector. There are still many traditional systems which could be leveraged. It is nonetheless a fact that Stripe is an example of how the concept of “business as usual” is rapidly evolving. Firms that hope to remain one step ahead of the curve will therefore need to consider venturing into the cryptocurrency marketplace sooner as opposed to later.