By Som Shekhar Singh
Algorithmic trading has been in place for a long time now. Artificial intelligence has powered the ability to evolve and tune these algorithms similar to what a human being would do by evaluating results and reworking models, albeit at a much faster pace and with much more accuracy and less bias.
AI has the potential to replace and improve upon the thinking of analysts (by screening large volumes of data like market data, brokerage reports, company annual reports and results etc.) and framing answers to questions to make good investment decisions. Blockchain can also help in some parts of the lifecycle, such as making data securely available to everyone in a secure fashion, enabling functions such as efficient proxy voting and reducing systematic risks like insider trading.
Blockchain as driving force of future stock markets
In the world of blockchain, the regulators are perceived as the biggest barrier or enablers for its adoption. However, research suggests that a major section of organisations do not believe regulatory issues will be a barrier for increasing blockchain investments. This is also because many market regulators and global exchanges across geographies, including the NYSE and Deutsche Borse, have already showed their intent to evaluate the feasibility and advantages of blockchain.
Japan’s Financial Services Agency has allowed the Japan Exchange Group, which operates the Tokyo Stock Exchange, to use blockchain as its core trading infrastructure. In 2015, Nasdaq unveiled the use of its Nasdaq Linq blockchain ledger technology to successfully complete and record private securities transactions.
Still, there are many national and regional regulators adopting a wait-and-watch approach, preferring to explore and understand blockchain’s regulatory and policy implications before moving forward. Overall, there is certainly slow progress on the development of the necessary regulatory frameworks, legislation and industry standards that are required to move from pilots to