Artificial intelligence is pushing financial systems toward a model in which machines execute transactions at scale, raising new challenges in control, monitoring and infrastructure, Microsoft and Chainalysis executives said.
Bill Borden, vice president of worldwide financial services at Microsoft, said Tuesday that legacy systems will face increasing pressure as transaction demands become more complex. The tipping point comes when “latency, scale and complexity start to impact your ability to compete,” forcing companies to rethink how their systems are built, he said at an Alchemy event in New York.
Although automation has long been a part of finance, Borden said the focus now is on trust rather than capacity. “It’s not a question of whether technology can automate…the execution of a hedging strategy – it can. The question is: can you trust it? Can you audit and monitor?” he said.
Microsoft, which offers its own AI assistant in several of its products, is developing tools to manage this transition, including systems that assign identities and permissions to AI agents and track their actions. In regulated environments, Borden said companies must be able to show “what controls them” and whether a system “followed policy” when decisions are made without direct human intervention.
Jonathan Levin, co-founder and CEO of Chainalysis, said the crypto sector already offers a working model of automated finance. Blockchain networks process large volumes of transactions through smart contracts and software-driven wallets, creating what he described as an environment similar to agent-based systems. “We prepared for these moments well before other parts of the financial services industry,” Levin said.
This experience extends to risk management. Levin cited efforts to track illicit funds across “thousands of different wallets” as an example of the type of monitoring needed in a system where transactions take place on a large scale without direct human intervention.
Looking ahead, both leaders expect a combination of systems to coexist. Levin said that “in 10 years, the majority of commerce will be on public infrastructure,” while Borden highlighted a more integrated approach linking public blockchains, private networks and existing rails.
“I think traditional rails will continue to exist,” Borden said, with software acting as the layer that connects them.
