Level39 boss Eric Van Der Kleij. Level39 As boss of Canary Wharf's Level39, Eric Van der Kleij is one of the most important people in the fintech scene in London — and possibly the world.

There are over 150 fintech businesses housed in Level39, which despite its name now covers three floors in One Canada Square.

"People tell us it’s the biggest space of its kind worldwide," Van der Kleij told Business Insider during a recent visit to Level39, a fintech-dedicated office space. "We’ve not measured so I don’t want to make any claims."

Level39 was set up in 2013 by the Canary Wharf Group to encourage a new generation of finance firms to come to the East London office peninsula — financial technology, or fintech, startups.

"Canary Wharf deserves credit because this is not cheap," says Van de Kleij. "This is a serious long term investment. But I think it’s a good thing because what we want is one of these companies to turn around and say can you build me my new headquarters in Wood Wharf."

Just over 2 years on, the space has broadened out to welcome "smart city" and cybersecurity startups too, as well as opening new space for high growth businesses on Level 42 and 24. The building can now house a startup from being a 2-man operation up to a 20-plus team.

"They want to eat the banks’ lunch"

The huge number of startups under Van der Kleij's nose gives him a good overview of what exactly the fintech world is up to.

"We find they fit into two camps," he says. "There’s the camp that wants to help the existing world of financial services to improve, to be more transparent, to provide better customer choice, to lower their costs. And then there are those that want to be the new bank, they want to eat the banks’ lunch. We love both of them."

Level39's kitchen space. Level39

Van der Kleij is very excited about one particular type of new technology — the blockchain, the software that runs bitcoin.

"The real powerful work being done in fintech is blockchain," he says. "I can tell you now with certainty that every major western bank we’ve spoken to, and some eastern ones, are looking at blockchain technology."

The blockchain creates bitcoins, allows transactions to happen, and creates a public record of all transactions, shared across hundreds of computers. Transactions can't be reversed and are much faster than the current system.

Banks currently have to interact with each others' systems when transferring money between accounts. This can be a slow, cumbersome, and a costly exercise, given how old many of the banks' computer systems are.

But if a secure, transparent, piece of software could automate these types of interbank transfers, it would be vastly quicker and cheaper. Barclays, UBS and Citi are all exploring how it could be used.

There are potential applications beyond payments too — Santander says it has 25 use cases for blockchain technology, while BNP Paribas says the technology could make some companies that hold stock "redundant."

"Very similar dynamics to music"

Van der Kleij calls blockchain "the real frontier" of finance and likens its evolution out of bitcoin to the rise of peer-to-peer technology out of illegal music-sharing website Napster.

He says: "In the world of music you had Napster as the unregulated challenger to the establishment. What they did is prove that technology can enable peer-to-peer file sharing to take place without the establishment controlling it. What that industry did is they wisely embraced that technology to reduce their costs and you now have the iTunes Store, Spotify. That transformed the model of music distribution.

Startups at Level39 overlook the UK headquarters of some of the world's biggest banks. Level39 "Who’s the Napster? It is companies involves in open ledger or blockchain technology. Of course its origins came from Bitcoin. Bitcoin is incredibly interesting and very exciting but very challenging for the regulator because of the privacy it affords.

"The challenge is we don’t want this to become the money launder’s weapon of choice, which is what the regulator is worried about. It has very similar dynamics to the world of music."

Level39 residents working on bitcoin and blockchain technologies include CodeStack, BitReserve and Coinjar.

Van der Kleij is confident that, as with music, blockchain technology will mature and enter the mainstream — we'll get our iTunes or Spotify of finance.

Not only will blockchain adoption make banking faster and cheaper, he also thinks the blockchain has the potential to make banking safer.

"You know the thing that caused the big problem in the financial crisis?" he asks. "It was these derivative mortgage-backed securities. Cunning people were repackaging different mortgage securities into products. When institutions bought them they had no real way of looking at the underlying assets they were buying because they were so complex. If they were forced to build that on blockchain, an investment manager could press a button and see the truth because of the immutability."

For now though, it's early days for the blockchain.