12.14.2015
By Rob Daly

Disruptive Technologies in Focus at #GMSNYC

Bitcoin, social media and artificial intelligence were prime topics of last week’s eighth-annual Global Markets Summit, hosted by Markets Media.

The two-day event, which offered separate days for market structure and financial technology debates, brought together line-of-business professionals and technologist to discuss their common concerns regarding disruptive technology.

The New York conference experienced its own brush with disruptive technology as the Summit’s #GMSNYC hashtag trending on Wednesday, Dec. 9.

Bitcoin and its underlying blockchain technology stole some of the conference’s limelight, with five separate sessions and several more references from other sessions as well.

From presentations by Chad Cascarilla, CEO and co-founder of itBit, and Todd McDonald, co-founder and chief strategies for R3CEV, to panel discussions consisting of representatives from bitcoin technology-enabling firms, trading firms and industry bodies, showed the growth of the cryptocurrency within Wall Street.

No longer are financial services firms debating the benefits of bitcoin and blockchain and if they should adopt it, but now are discussing how to deploy technology and what would be the lowest-hanging fruit that would benefit from its implementation.

According to Cascarilla, the answer is any data that would benefit from an unalterable distributed database, such as titles, trusts, patents and wills. “You can put almost anything through blockchain because it is just a way to digitize information while creating a shared ledger,” he said.

Yet, that is just a low-level example of blockchain’s capabilities, according to one bitcoin panelist, who cited the potential of ‘smart’ contracts that would consist of a succession of if/then statements recorded in the blockchain. “If one envisions the blockchain as publicly accessible cloud computing, a smart contract would be a private cloud,” the panelist explained.

Social media and artificial intelligence discussions followed similar paths of ‘not if, but how’ conversations.

Social media, which still is industry shorthand for Twitter and StockTwits, has matured over the past three to four years since many firms began integrating its data into their trading models after seeing clear signals, according to panelists.

A point was made that ‘robo’-advising remains a somewhat nascent technology, but there are high hopes. The perceived bright future has led to a very active merger and acquisition situation between robo-advisor vendors and marquee-named asset managers.

One participant went as far to predict that financial advisors eventually would have robo-advisors advising as much as 20% of the advisor’s client book.

As Cathie Wood, the CEO and CIO or Ark Investment Management noted during a panel, Wall Street still needs to wait for the regulators weigh in with their own views, as the technologies mature.

“Bitcoin is a prime example,” she said. “The (U.S.) Securities and Exchange Commission treats them as currency. The Commodity Futures Trading Commission treats them as commodities and the Internal Revenue Service treats them as property in terms of regulation.”

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