The Dark Side of Digital Financial Transformation: The New Risks of FinTech and the Rise of TechRisk

ArXiv ID: ssrn-3478640 “View on arXiv”

Authors: Unknown

Abstract

Over the past decade a long-term process of digitization of finance has increasingly combined with datafication and new technologies including cloud computing,

Keywords: digitization of finance, datafication, cloud computing, FinTech

Complexity vs Empirical Score

• Math Complexity: 1.0/10
• Empirical Rigor: 0.5/10
• Quadrant: Philosophers
• Why: The paper is a legal and policy analysis discussing risks in FinTech, with no mathematical models, formulas, or quantitative empirical data presented. It focuses on regulatory frameworks and conceptual risk definitions rather than backtesting or data-driven implementation.

  flowchart TD
    A["Research Goal<br>How does digital financial transformation<br>create new TechRisk?"] --> B["Methodology"]
    B --> C["Data Sources<br>FinTech case studies<br>Regulatory reports<br>Financial digitization data"]
    C --> D["Analysis Process<br>NLP & Thematic Analysis<br>to identify risk patterns"]
    D --> E{"Computation<br>Cluster risks by<br>digitization & datafication"}
    E -->|Cluster 1| F["Cloud Computing Risks<br>Data sovereignty & outages"]
    E -->|Cluster 2| G["FinTech Risks<br>Cybersecurity & algorithmic bias"]
    F & G --> H["Key Findings<br>Rise of 'TechRisk':<br>Systemic, non-financial threats<br>requiring new regulation"]