After the resounding success of the inaugural event last year, Ecosystm is once again partnering with Elevandi and the State Secretariat for International Finance SIF as a knowledge partner for the Point Zero Forum 2023. In this Ecosystm Insights, our guest author Jaskaran Bhalla, Content Lead, Elevandi talks about the Point Zero Forum 2023 and how it is all set to explore digital assets, sustainability, and AI in an ever-evolving Financial Services landscape.
The Point Zero Forum is returning for its second edition between 26 to 28 June 2023 in Zurich, Switzerland. The inaugural Forum held in June 2022 attracted over 1,000 leaders and featured more than 200 esteemed speakers from Europe, Asia Pacific, the USA, and MENA. The Forum represents a collaboration between the Swiss State Secretariat for International Finance (SIF) and Elevandi and is organised in cooperation with the BIS Innovation Hub, the Monetary Authority of Singapore (MAS), and the Swiss National Bank.
As we gear up for this year’s Point Zero Forum, let’s take a moment to reflect on some of the pivotal developments that have shaped the Financial Services industry since the previous Forum and also moulded the three key themes that will take centre stage this year: Sustainability, Artificial Intelligence (AI), and Digital Assets.
COP27, the rise of blended finance and the groundbreaking Net-Zero Public Data Utility
In November 2022, the Government of the Arab Republic of Egypt hosted the 27th session of the Conference of the Parties of the UNFCCC (COP27), with a view to accelerate the transition to a low-carbon future. In the build-up to COP27, Ravi Menon, the Managing Director of the MAS spoke at the inaugural Transition Finance towards Net-Zero conference and shared with the audience that the world is currently not on a trajectory to achieve net-zero emissions by 2050. And according to the UN Emissions Gap report 2021, based on the current policies in place, the world is 55% short of the emissions reduction target for 2030. He also elaborated on the significant role that blended finance can play in tackling climate change, a theme that widely resonated with the global leaders at COP27. To enable easy and transparent reporting on climate commitments, the Climate Data Steering Committee (CDSC) outlined the next steps on its recommended plans for the Net-Zero Data Public Utility (NZDPU) at COP 27. NZDPU aims to aid efforts to transition to a net-zero economy by addressing data gaps, inconsistencies, and barriers to information that slow climate action.
The Point Zero Forum 2023 will deep-dive into the data, technologies, and capital and risk management solutions that can accelerate the fair transition towards a low-carbon future.
Panel Discussion Highlight: The opening panel discussion, “Data for Net-Zero: Views from the Climate Data Steering Committee,” scheduled for 26 June, will feature members of the CDSC, which include the Financial Conduct Authority, the MAS, Glasgow Financial Alliance for Net Zero (GFANZ), and the Swiss State Secretariat for International Finance. The panel will discuss the role of new technologies and collaborative platforms in promoting greater accessibility of transition data and innovative business models.
The launch of ChatGPT by OpenAI and its record for the fastest 100M monthly active users
The launch of ChatGPT by OpenAI on 30 November, 2022 led to widespread adoption by users globally – eventually setting the record for the fastest-growing, active users, hitting 100M monthly active users by Feb 2023. While on one hand users rushed to share enormous efficiency gains achieved by the use of ChatGPT, on the other hand ChatGPT soon became a disruptive tool to spread fake news.
The Point Zero Forum 2023 will deep-dive into Generative AI’s potential for enhancing efficiency, improving risk management, and providing better customer experience in the Financial Services industry, while highlighting the need for ensuring fair, ethical, accountable, and transparent use of these technologies.
Panel Discussion Highlight: The session “Breaking New Ground with Generative AI: Project MindForge”, scheduled for 27 June, will feature global leaders from NVIDIA, the MAS, Citigroup and Bloomberg. The panel will discuss the opportunities of Generative AI for the Financial Services sector.
MiCA regulation gets adopted by the EU lawmakers and sets a precedent for digital asset regulations
More than 2.5 years after it was first proposed, the EU Markets in Crypto-Assets (MiCA) regulation was approved in April 2023 by EU Parliament. While there is still work to be done to implement MiCA and measure its success, and to answer open questions around regulation for out-of-scope assets (like DeFI and NFTs), the digital assets industry is keenly observing whether MiCA could serve as a template for global crypto regulation. In May 2023, the International Organization Of Securities Commissions (IOSCO), the global standard setter for securities markets, also joined the global discussion on digital asset regulation by issuing for consultation detailed recommendations to jurisdictions across the globe as to how to regulate crypto assets.
The Point Zero Forum 2023 will do a stocktake on key global regulatory frameworks, market infrastructure, and use cases for the widespread adoption of digital assets, asset tokenisation, and distributed ledger technology.
Panel Discussion Highlight: The sessions “State of Global Digital Asset Regulation: Navigating Opportunities in an Evolving Landscape” and “Interoperability and Regulatory Compliance: Building the Future of Digital Asset Infrastructure”, scheduled on 26 and 27 June respectively, will feature global leaders from both public sector (such as the MAS, Bank of Italy, Bank of Thailand, U.S. Commodity Futures Trading Commission, EU Parliament) and private sector organisations (such as JP Morgan, Sygnum, SBI Digital Assets, Chainalysis, GBBC, SIX Digital Exchange). The discussions will centre around digital asset regulations and key considerations in the rapidly evolving world of digital assets.
Register here at https://www.pointzeroforum.com/registration. Receive 10% off the Industry Pass by entering the code ‘JB10’ at check out. (Policymakers, regulators, think tanks, and academics receive complimentary access/ Founders of tech companies (incorporated for less than 3 years) can apply for a discounted Founder’s Pass)
The Financial Services industry can benefit greatly from leveraging Data and AI technologies to enhance client value and innovation. BFSI organisations want to deliver AI-driven outcomes.
However, many AI projects fail to deliver long-term business value. Leaders in the industry must overcome challenges such as
- Converting proofs of concept to scalable implementations
- Deploying end-to-end AI and Data strategies
- Evolving business requirements
- Responding to emerging trends such as Generative AI.
As a technology leader in BFSI, here are 5 ways you can help deliver on your organisation’s AI ambitions.
- Think in terms of outcomes – not use cases
- Identify and eliminate digital debt
- Build the right data platform architecture
- Adopt a dual AI strategy
- Be part of an innovation ecosystem
Read on to find out more.
Click here to download ‘5 Actions to Achieve Your AI Ambitions’ as a PDF
The global economy remains fragile due to multiple factors; and banking organisations will need to weather the storm. While large and well-capitalised banks are expected to fare better, there is a need for the industry to pursue new sources of value beyond traditional boundaries.
Banking industry leaders should be bold, proactive, and envision possibilities beyond current uncertainties. Technology has a key role to play in turning their innovation and resiliency goals into reality.
Read on to find out how the National Australia Bank, the Scottish National Investment Bank, the ANZ Bank, the Swiss National Bank, Mastercard, and the French banking group Crédit Agricole are leading the charge in driving innovation within the banking industry by investing in new technologies and exploring business models to better serve their customers.
Download ‘The Future of Banking’ as a PDF
Leading Banking and Financial Services organisations play a crucial role in financing sustainability transition. They have the infrastructure and resources to kickstart their own sustainability journey. But beyond that, they also have a greater role in building a sustainable value chain.
This extends to helping the traditional economy to transition; green investments to promote organisations with the right intentions; and empowering their customers to make environmentally-friendly choices.
As a technology leader in BFSI, you are an integral part of your organisation’s sustainability journey. Here are 5 ways in which BFSI tech leaders can support their organisations to turn sustainability intentions into reality.
Align tech with business goals and strategy. Think like a business leader and understand larger goals beyond technology deployments to empower your team.
View reporting as more than a checklist. You are in an ideal position to demonstrate the value of data insights beyond reporting mandates to the leadership team – link them to larger business outcomes.
Build intelligence into your facilities and assets. Consider investing in an intelligent enterprise asset management solution to automate asset and infrastructure management, remotely monitor and manage asset operations, and achieve sustainable business outcomes.
Automate your infrastructure allocation. You are increasingly using FinOps tools and other predictive analytics dashboards for cost and resource optimisation – extend the use for greater energy efficiency.
Understand your organisation’s unique sustainability journey. Seek independent opinion from third parties to empower your organisation to take the first step in the sustainability strategy, derive insights from data assets, and create market differentiation.
Read on to find more.
Download 5 Sustainability Actions for BFSI Tech Leaders as a PDF
Ecosystm and Bitstamp, conducted an invitation-only Executive ThinkTank at the Point Zero Forum in Zurich. A select group of regulators and senior leaders from financial institutions from across the globe came together to share their insights and experiences on Decentralised Finance (DeFi), innovations in the industry, and the outlook for the future.
Here are the 5 key takeaways from the ThinkTank.
- Regulators: Perception vs. Reality. Regulators are generally perceived as having a bias against innovations in the Financial Services industry. In reality, they want to encourage innovation, and the industry players welcome these regulations as guardrails against unscrupulous practices.
- Institutional Players’ Interest in DeFi. Many institutional players are interested in DeFi to enable the smooth running of processes and products and to reduce costs. It is being evaluated in areas such as lending, borrowing, and insurance.
- Evolving Traditional Regulations. In a DeFi world, participants and actors are connected by technology. Hence, setting the framework and imposing good practices when building projects will be critical. Regulations need to find the right balance between flexibility and rigidity.
- The Importance of a Digital Asset Listing Framework. There has been a long debate on who should be the gatekeeper of digital asset listings. From a regulator’s perspective, the liability of projects needs to shift from the consumer to the project and the gatekeeper.
- A Simplified Disclosure Document. Major players are willing to work with regulators to develop a simple disclosure document that describes the project for end-users or investors.
Read below to find out more.
Download Pathways for Aligning Innovation and Regulation in a DeFi World as a PDF
Ecosystm supported by their partner EY, conducted an invitation-only Executive ThinkTank at the Point Zero Forum in Zurich. A select group of regulators, investors, technology providers, and senior leaders from financial institutions from across the globe came together to share their insights and experiences on the practicability, regulatory support, and implications of sustainable finance portfolios.
Here are some of the key takeaways from the ThinkTank.
- The Barriers to a Sustainable Future. The first step towards a sustainable future is recognising the challenges organisations face when pursuing Net Zero targets. Often, Net Zero targets are looked upon as additional costs.
- Overcoming the Challenges. It is important to connect Net Zero back to business goals, given that there might be sudden shifts in regulations and because of the emergence of environment-conscious consumers.
- A Sustainable Future Requires a Collaborative Approach. Global governments, regulators, Financial Services institutions, other enterprises, and technology providers need to collaborate on building a sustainable future.
- A Time for Simplification. Clear mandates on reporting climate aspects similar to how financial aspects are reported, will result in greater adoption of sustainability and ESG measures.
- The Role of Digital Architecture. The path to a Net Zero, decarbonised world will be technology-led.
Read below to find out more.
Download Risks and Opportunities of Net Zero Commitments and Decarbonisation Pathways as a PDF
It’s been a while since I lived in Zurich. It was about this time of year when I first visited the city that I instantly fell in love with. Beautiful blue skies and if you’re lucky enough, you can see the snow-capped mountains from Lake Zurich. It’s hard not to be instantly drawn to this small city of approximately 1.4 million people, which punches well above its weight class. One out of every eleven jobs in Switzerland is in Zurich. The financial sector generates around a quarter of the city’s economic output and provides approximately 59,000 full time equivalent jobs – accounting for 16% of all employment in the city.
Between 21-23 June, Zurich will also be home to the Point Zero Forum – an exclusive invite-only, in-person gathering of select global leaders, founders and investors with the purpose of developing new ideas on emerging concepts such as decentralised finance (DeFi), Web 3.0, embedded finance and sustainable finance; driving investment activity; and bringing together public and private sector leaders to brainstorm on regulatory requirements.
The Future of DeFi
Zug is a little canton outside of Zurich and is famously known as “Crypto Valley”. When I lived in Zurich, Zug was the home of many of the country’s leading hedge funds as Zug’s low tax, business friendly environment and fantastic quality of life attracted many of the world’s leading fund managers and companies. Today the same can be said about crypto companies setting up shop in Zug. And crypto ecosystems are expanding exponentially.
However, with the increase in the global adoption of cryptocurrency, what role will the regulators play in aligning regulation without stifling innovation? How can Crypto Valley and Singapore play a role in defining the role regulation will play in a DeFi world?
DeFi is moving fast and we are seeing an explosion of new ideas and positive outcomes. So, what can we expect from all of this? Well, that is what I will discuss with a group of regulators and industry players in a round table discussion on How an Adaptive and Centralised Regulatory Approach can Shape a Protected Future of Finance at the Point Zero Forum. We will explore the role of regulators in a fast-moving industry that has recently seen some horror stories and how industry participants are willing to work with regulators to meet in the middle to build an exciting and sometimes unpredictable future. How do we regulate something in the future? I am personally looking forward to the knowledge sharing.
For the industry to strive and innovate, we need both regulators and industry players to work together and agree to a working framework that helps deliver innovation and growth by creating new technology and jobs. But we also need to keep an eye out on the increasing number of scams in the industry. It is true to say that we have seen our fair share of them in recent months. The total collapse of TerraUSD and Luna and the collapse of the wider crypto market that saw an estimated loss of USD 500 billion has really spooked global markets.
So is cryptocurrency here for good and will it be widely adopted globally? How will regulators see the recent collapse of Luna and view regulations moving forward? We have reached an interesting point with cryptocurrencies and digital assets in general. Is it time to reflect on the current market or should we push forward and try to find a workable middle ground?
Let’s find out. Watch this space for my follow-up post after the Point Zero Forum event!
When non-organic (man-made) fabric was introduced into fashion, there were a number of harsh warnings about using polyester and man-made synthetic fibres, including their flammability.
In creating non-organic data sets, should we also be creating warnings on their use and flammability? Let’s look at why synthetic data is used in industries such as Financial Services, Automotive as well as for new product development in Manufacturing.
Synthetic Data Defined
Synthetic data can be defined as data that is artificially developed rather than being generated by actual interactions. It is often created with the help of algorithms and is used for a wide range of activities, including as test data for new products and tools, for model validation, and in AI model training. Synthetic data is a type of data augmentation which involves creating new and representative data.
Why is it used?
The main reasons why synthetic data is used instead of real data are cost, privacy, and testing. Let’s look at more specifics on this:
- Data privacy. When privacy requirements limit data availability or how it can be used. For example, in Financial Services where restrictions around data usage and customer privacy are particularly limiting, companies are starting to use synthetic data to help them identify and eliminate bias in how they treat customers – without contravening data privacy regulations.
- Data availability. When the data needed for testing a product does not exist or is not available to the testers. This is often the case for new releases.
- Data for testing. When training data is needed for machine learning algorithms. However, in many instances, such as in the case of autonomous vehicles, the data is expensive to generate in real life.
- Training across third parties using cloud. When moving private data to cloud infrastructures involves security and compliance risks. Moving synthetic versions of sensitive data to the cloud can enable organisations to share data sets with third parties for training across cloud infrastructures.
- Data cost. Producing synthetic data through a generative model is significantly more cost-effective and efficient than collecting real-world data. With synthetic data, it becomes cheaper and faster to produce new data once the generative model is set up.
Why should it cause concern?
If real dataset contains biases, data augmented from it will contain biases, too. So, identification of optimal data augmentation strategy is important.
If the synthetic set doesn’t truly represent the original customer data set, it might contain the wrong buying signals regarding what customers are interested in or are inclined to buy.
Synthetic data also requires some form of output/quality control and internal regulation, specifically in highly regulated industries such as the Financial Services.
Creating incorrect synthetic data also can get a company in hot water with external regulators. For example, if a company created a product that harmed someone or didn’t work as advertised, it could lead to substantial financial penalties and, possibly, closer scrutiny in the future.
Conclusion
Synthetic data allows us to continue developing new and innovative products and solutions when the data necessary to do so wouldn’t otherwise be present or available due to volume, data sensitivity or user privacy challenges. Generating synthetic data comes with the flexibility to adjust its nature and environment as and when required in order to improve the performance of the model to create opportunities to check for outliers and extreme conditions.
We are seeing a rise in social and environmental consciousness – especially in the younger generation. Their awareness of human rights, the environment and inclusion is growing exponentially – they want to create impact. Organisations are being driven to develop and demonstrate an Environmental, Social and Governance (ESG) consciousness in their actions and investments.
In this Ecosystm Snapshot, we cover some of the recent examples of how governments and individual advocates are creating a difference; and how financial organisations and tech providers are embracing ESG.
Read how organisations such as Sun Cable, Equinix, Microsoft, NVIDIA, Prologis, Zensung, Ergo, Munich Re, Natwest, JPMorgan, Credit Suisse and others are working to make the world a better place.
