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Top Themes from DTCC’s 2018 Fintech Symposium

Tony Brownlee
3/27/18 6:13 AM

Last week leading banks, broker dealers, and regulators gathered in New York for DTCC’s third annual Fintech Symposium. This is always a must attend event for Kingland as its incredibly well run and covers many of the emerging trends in the industry in an afternoon.  DTCC’s perspective is critical as they sit at the cross roads of the sell side, buy side, and global regulatory environment, so if an issue is on the table, there’s a strong reason. Ann Bergin_David Kingland_DTCC_Fintech (2).jpg

As with most technology, the acronyms abound. For those that missed this year's event; here are three themes (and a few acronyms) worth some attention:

  1. Blockchain and distributed ledger technologies (DLT) are maturing. When DTCC first launched this event three years ago it was even titled the Blockchain Symposium. While the event has expanded to all of Fintech, Blockchain is still central to the theme. The takeaways:  DTCC, the Australian Securities Exchange (ASX), and others throughout the financial industry are moving from experimenting to making real production progress with DLT. The talent and expertise in the industry is maturing and companies that are looking to explore or invest with DLT can find help. The caution may be that as the industry has learned a lot in the last three years, the overarching architectures of Blockchain may be evolving to an improved state – especially for initiatives that span cross industry and to different regions around the world. 
  2. Artificial Intelligence (AI) and Natural Language Processing (NLP) are big areas of value. The takeaways: McKinsey is highlighting the use of AI throughout every stage of the trade lifecycle and significant ROI from most banks that are investing. Additional investments in AI and NLP (like where we're investing at Kingland) are proving how these technologies can help the knowledge workers – those resources that are hardest to replace – do even more through the acceleration of reading, extraction, and interpretation of data. DTCC CEO Mike Bodson thinks AI may likely have the greatest impact of all emerging technologies as it can be used to improve legacy systems and processes as well as new DLT systems. 
  3. More regulation is coming, particularly around Initial Coin Offerings (ICOs).  The takeaways: To date, the SEC has seen more than 1,500 ICOs come to market. The regulatory ecosystem of the SEC, CFTC, FINRA, and others are monitoring closely and preparing additional guidance and direction on the treatment of how to protect investors and promote safe, fair markets around Bitcoin and its cousins. What will this regulation look like? The simple answer is this – if it looks like a security, behaves like a security, trades like a security, and has value like a security, then the investors, the markets, and the "it" will likely be regulated like a security. 

That’s our quick take on this event. If you’d like to dive more into these topics, feel free to reach out and we’d be happy to talk further.

 

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