Microsoft and Chainalysis executives say artificial intelligence is pushing financial systems toward a model where machines execute transactions at scale, creating new challenges for control, oversight and infrastructure.
Bill Borden, Microsoft’s corporate vice president of worldwide financial services, said on Tuesday that legacy systems will come under increasing pressure as transaction needs become more complex. The tipping point comes when “latency, scale, complexity start to affect your ability to compete,” he said at an event hosted by Alchemy in New York, forcing companies to rethink how their systems are built.
Borden said that while automation has long been a part of finance, the focus has now shifted from capabilities to trust. “It’s not about whether the technology can automate… the execution of hedging strategies – it can be done. The question is: Can you trust it? Can you audit and control it?” he said.
Microsoft, which offers its own AI assistants across many of its products, is developing tools to manage this shift, including systems to assign identities and permissions to AI agents and track their behavior. Borden said that in a regulated environment, companies must be able to show “what controls it” and whether the system “followed policy” when making decisions without direct human input.
Jonathan Levin, co-founder and CEO of Chainaanalysis, said that the encryption industry already provides a working model for automated finance. Blockchain networks handle large volumes of transactions through smart contracts and software-driven wallets, creating what he described as an environment similar to an agent-based system. “We prepared for these moments long before the rest of the financial services industry,” Levine said.
This experience extends to risk management. Levine pointed to the effort to track illicit funds across “thousands of different wallets” as an example of the monitoring needed in systems where transactions occur at scale without direct human input.
Going forward, both executives expect multiple systems to coexist. Levin said that “the majority of commerce in a decade will be on public infrastructure,” while Boden pointed to a more integrated approach that connects public blockchains, private networks and existing rail.
“I do think traditional railroads are here to stay,” Boden said, with software serving as the layer that connects them.
