The increasing use of artificial intelligence in financial systems is driving the industry towards a model where machines handle transactions on a large scale, posing new challenges related to control, oversight, and infrastructure, according to Microsoft and Chainalysis executives. Bill Borden, Microsoft's corporate vice president of worldwide financial services, stated that legacy systems will face mounting pressure as transaction demands become more complex, with the tipping point occurring when latency, scale, and complexity begin to impact a firm's ability to compete. This forces companies to reevaluate how their systems are built.
While automation has long been a part of finance, Borden noted that the focus is now shifting from capability to trust, with the question being whether technology can be trusted, audited, and controlled. Microsoft is developing tools to manage this transition, including systems that assign identities and permissions to AI agents and track their actions. In regulated environments, firms must demonstrate what controlled a system and whether it followed policy when decisions are made without direct human input. Jonathan Levin, co-founder and CEO of Chainalysis, pointed to the crypto sector as a working model of automated finance, with blockchain networks processing large volumes of transactions through smart contracts and software-driven wallets.
Levin noted that his company has been preparing for these developments long before other parts of the financial services industry. Looking ahead, both executives expect a mix of systems to coexist, with Levin predicting that the majority of commerce will be settled on public infrastructure in 10 years, while Borden envisions a more integrated approach linking public blockchains, private networks, and existing rails.