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Markets

Technology of the Future Conference: Recapping The First Day

By Eva Saidac, Head of Business Operations, Market Technology at Nasdaq

To find success in today's global markets, it has become imperative to learn what other organizations are doing and share best practices in order to help drive change. Several forums for exchanges and clearinghouses exist across the world, but perhaps one of the most unusual is Nasdaq's biennial Technology of the Future (ToF) conference.

ToF, now in its 16th edition, is a global community of executive-level marketplace clients and partners who have a common interest: they're either currently operating on Nasdaq technology or are considering doing so. No one else in the exchange business has the critical mass of global exchange technology customers to host such a strategically relevant event.

Over 100 delegates from the world's exchanges gather in Stockholm with Nasdaq's Market Technology team during June 26-28 to discuss the challenges facing the industry, as well as how technology can help solve problems and innovate to create competitive advantage. Here are a few highlights from the Tuesday's sessions:

In his opening remarks, Lars Ottersgård, Nasdaq's Executive Vice President, Market Technology, welcomed all the delegates. He emphasized that "Nasdaq has a strong and accelerated commitment for sustainable research and development, and that [we] are making sure that our customer solutions keep pace with waves of disruption."

Andrew McAfee, Co-director of the MIT initiative on the Digital Economy and Principal Research Scientist, followed with a futuristic talk entitled "How Technological Progress Changes Business, the Economy and Society."

In his view,"machines are going to open up a new territory, and machines and minds are going to explore it together." During the second Machine Age, McAfee sees human value best leveraged through common sense, by asking questions, developing social skills, and partnering with machines.

Nasdaq CEO Adena Friedman explained how exchanges are driving their economies forward and rewriting tomorrow. In her presentation, she identified four themes that are defining the exchange industry over the coming decade:

1) Investment banks embracing change: The global banks are re-asserting themselves across the capital markets as they emerge largely stronger from the credit crisis. They are reasserting their strength as trading counterparties, but in new ways.

2) Evolution of investment management: The asset management space is growing through a period of significant disruption and evolution. While the overall pie of investible assets continues to grow at an attractive rate globally, the outcomes for individual players in asset management will differ greatly. The outcome over the next decade will be a barbelling of the sector.

3) Data explosion: Thanks to the cloud and the cost of data storage, the availability of data has exploded around the world and across every industry. Data is the lifeblood of the financial industry; without data there is no trading, there are no investment decisions. The financial industry has always been the forefront of organizing, integrating, and monetizing data across the ecosystem. Now, with the myriad of new data sources and the ability to mine it with machine learning, it gives the industry new ways to operate.

4)Markets economy: With the launch of the digital economy and online commerce, eBay and other electronic auction communities were pioneers in embracing true price discovery. What we are seeing today, however, is the opportunity for the potential for continuous price discovery as well as auctions in assets outside specialty consumer products. Established companies and startups are moving toward this model. Moving the markets into the cloud to globalize participation, leveraging the immense power of data to empower consumers and investors, integrating the blockchain to facilitate instant settlement and ownership tracking, and the potential for digital currencies to accommodate the flow of capital, will all combine to change the nature of capital markets -- just as it will the nature of global commerce. Ultimately, the Markets Economy will empower consumers, who will have more choices and control over their transactions than ever before.

Jesse McWaters, Project Lead - Disruptive Innovation in Financial Services at the World Economic Forum, discussed the "Key Factors Influencing the Future of the Capital Markets". McWaters discussed several trends during his speech. These included:

  • Back and middle office operations are becoming more modular
  • Platforms that separate customer experience from product balance sheets
  • Building new bridges between capital and the end customer
  • AI is making data scale more important than capital scale
  • Financial services is becoming more regionally fragmented
  • Crypto-assets exist in parallel financial system

The morning session wrapped up with discussion about the "Evolution of Business Models at Sell-Side, Buy-Side and Market Infrastructure Organizations," led by Nasdaq's Carl Slesser, vice president, business management, banks and brokers. Panelists were from ASX, Nasdaq, Goldman Sachs and Citi.

The afternoon kicked off with a talk about "Cloud Relevancy for Market Operators." This was followed by a customer conversation about "Market Infrastructure Technology: Past, Present and Future," led by Magnus Haglind, Nasdaq's Head of Product Management, Market Technology. The panelists included experts from Nasdaq, Hong Kong Exchange & Clearing, Singapore Exchange and Stanford University. The final presentation, given by Brad Peterson, Executive Vice President, CTO and CIO at Nasdaq, was "Technology of the Future: Tuning Into Future Technologies."

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.