, etc. and in the near future autonomous driving which e. g. could reshape the trucking industry, resulting in fewer accidents, smart cities with less pollution and energy usage, smart farms with better quality products and so on. a final category in the fintech landscape is cybersecurity. while increased reliance on digital technology may heighten the risk of cybersecurity being compromised, digital technology also presents numerous opportunities to improve security of digital financial services. data encryption to protect digitally stored data is improving with technological advances. data analytics can be used to detect irregular patterns and fraud. dlt could increase the transparency of transactions, making them easier to track and control, improving anti - money laundering ( aml ) regulations. 3. a look into the rise of fintech in the eu over the last couple of years, global fintech investment activity has been recording robust growth. while in 2012 total investment in this sector was less than us $ 12 billion, in 2018 global investment in fintech companies reached approximately us $ 112 billion ( with 2, 200 deals ), more than double its 2017 level of around us $ 51 billion ( as you can see in chart 2 ). moreover, 2018 was a year in which fintech investment, including venture capitals ( vc ), mergers and acquisitions ( m & a ) and private equities ( pe ), recorded a series of peaks. emerging fintech subsectors have seen the number of new startups rise rapidly, while highly mature sectors such as payments experienced a certain degree of consolidation. chart 2 global investment and banks ’ activity in fintech the us and silicon valley remain the world's biggest hubs for fintech companies and have the lion ’ s share in terms of financing. in 2018, us fintech investment reached us $ 55 billion across 1, 245 deals. europe ’ s fintech sector has been catching up with us fintech investment growth, with investment following an upward path since 2008, having reached us $ 34 billion with 536 deals in 2018, driven by big mergers and acquisitions ( m & as ) ( see chart 3 ). venture capital investment remains high in europe and in 2018, it attracted the second largest amount ever of vc investment in fintech. chart 3 total investment activity ( vc, pe and m & a ) in fintech in europe ( 2013 – 2018 ) despite concerns about brexit, the uk remained a leader in fintech in 2018 ( see chart 4 for the number of

cft ) regulations apply to fintech companies. we may argue that the eu has expanded the scope of its rules to include services that eu fintech companies offer to consumers. moreover, the european banking authority ( eba ) recognises the benefit in protecting consumers when they use financial services offered by firms outside the conventional financial services sector. it recommends defining consumers'rights in the fintech space, creating effective procedures for processing consumer complaints, improving the quality of disclosures to consumers in a digital environment, and increasing consumer financial literacy. in light of the potentially inconsistent regulatory regimes to which eu fintech companies are subject, the european commission published last year an action plan for the implementation of an eu - wide framework dedicated to fintech companies aimed at “ a more competitive and innovative european financial sector ”. the commission's action plan proposes 23 steps to enable innovative business models to scale up and support the uptake of new technologies, and to enhance cybersecurity and the integrity of the financial system, including an eu fintech laboratory where european and national authorities will engage with technology providers and an eu blockchain observatory and forum, which will report on the challenges and opportunities of crypto - assets. 5. 3 filling in the regulatory gap from the aforementioned regulatory frameworks, we all agree that risks related to regulation and compliance arise from fintech ’ s rapid growth and it is reasonable to expect that new or evolving risks will emerge for the system and for individual institutions. it appears that the main challenge is to implement legislation governing fintech companies in order to protect users and markets, while offering an environment favourable to growth. in the context of financial regulation, it is of utmost importance to strike a balance between the following three fundamental elements : 1. manage the trade - off between efficiency gains associated with technological innovation and the protection of stakeholders in the financial industry. on the one hand, regulation must not be too stringent to the point it preempts the creation and development of new technologies that generate efficiency and savings in transaction costs ; on the other hand, regulation must not be too lax, so as to make sure that investors and users of financial services are adequately protected and that regulatory frameworks are continuously adapting to technological advances, rather than falling behind the curve. 2. ensure an adequate regulatory level playing field for banks and fintechs, fundamental to achieve appropriate competition. first, activities involving the same risks in terms of financial stability, consumer protection and the integrity of the financial system should receive the same