“Wanderer above the Sea of Fog”- a new cartoon that illustrates how regulatory changes and the complexity of compliance stymies new entrant Fintechs. According to the Competitive Enterprise Institute, financial firms are now reporting the average cost to maintain compliance can total up to $10,000 per employee. Meanwhile, in the Decentralized Finance (DeFi) market, a governmental territorial bun fight between the SEC, US Treasury, Commodity Futures Trading Commission (CFTC) and State actors, has meant a number of Fintech’s are stuck in a legal limbo (e.g. Ripple). While a number of startups have responded by shopping around for regulatory favorable jurisdictions (e.g. crypto exchanges incorporating in Caribbean atolls), the most interesting response is the rise of the Compliance-as-a-Service market. Also, some more forward-thinking jurisdictions have set up Fintech sandboxes where new consumer services can be tested under a light regulatory environment. #regtech, #fintech, #caspardavidfriedrich