Goldman Sachs, Citigroup and financial industry leaders on what markets could look like in 2052

The internet, smartphones, euros and cryptocurrencies are just some of the innovations that have revolutionized markets over the past three decades. So Bloomberg Markets asked some financial industry leaders for their best guesses as to what could drive the biggest changes between now and 2052.

Their comments have been edited for length and clarity.

Adena Friedman, President and CEO of Nasdaq Inc.

I think the next 30 years will really be about value-added brokering in the markets. The technology will exist to allow every resource on the planet to be digitized and available to be bought and sold instantly.

So what are the technologies behind this? I think moving markets to cloud infrastructure will be a key component. Bringing more machine learning into market decisions, crime management, market management for fairness. And then

I definitely think that the digital asset ecosystem will mature in a very material way, to become mainstream.

But there are big caveats on that. One is crime management. If the digital asset ecosystem doesn’t take crime management seriously, governments simply won’t allow it to be adopted in the traditional way. And then the second is the scalability of the digital asset ecosystem which must equal, and frankly, surpass, the scalability of what traditional markets are capable of achieving today.

If blockchain can scale much more than it can today, I think you would see regulators would feel more comfortable bringing the digital asset construct to traditional markets. You may see the potential for a central bank digital currency that truly forms the basis for a much more digital payment structure. And then you might see the capital markets opening in a much more globalized format.

David Solomon, president and CEO of Goldman Sachs Group Inc.

The big macro trends involve artificial intelligence, biopharmaceuticals and biotechnology – changes that will have a profound impact on the way we all live. Big image problems. Also, invest in trying to find ways to make our energy sources greener over time.

How do we pool the capital needed to drive innovation? Some of these can be achieved through private sector venture capital. Part of the capital can come from governments. Some of the capital can also come from partnerships between the private sector and governments to try to find ways to encourage more investment.

There is already a lot of capital earmarked for artificial intelligence. As for medtech and biotech, we had a pandemic and the government intervened. But in general, for regular technological advancement and innovation, I don’t think we need public-private partnerships in the medtech or biotech space.

But to promote innovative climate technologies and a faster transition to clean energy will require far more capital than in other areas.

Most businesses have to deal with accelerating digitalization trends around their business and automation. I happen to think that blockchain technology is an early version of technologies that will eventually be used to further digitize the financial services infrastructure.

Because while there are a lot of good things with blockchain, it’s not a great technology for a large number of very high-speed transactions.

It’s not a perfect analogy, but the way to think about it is the way you accessed the internet 25 years ago versus the way you access the internet now.

Jane Fraser, CEO of Citigroup Inc.

When I think about the next 30 years and the innovations that will change and define markets, I don’t think of a single product, but I focus on the new ways we will do business in the industry. There are fundamental changes on the horizon that will rebuild the infrastructure of global markets and the architecture of finance as we know it today.

We are moving towards a boundless virtual economy where markets do not open or close, the entry and exit ramps of digital assets are unlimited, and metaverse activities are widespread. Digital assets will be widely embraced and protected, and we will see asset “avatars” that exist in more than one form between traditional assets, digital native assets, and tokenized versions of traditional assets.

In this world, market participants will be able to respond to “out of hours” announcements and overseas events at any time of day and in all time zones. The 24/7 nature of these transactions will reduce operational risk, simplify payments across all platforms globally, and improve consumer and customer experience.

Achieving this will require industry-wide operational standards and improved market infrastructure in both the private and public sectors. We will need appropriate regulatory frameworks, a new generation of risk management and governance tools, and the right infrastructure to support digital twins of physical and object systems.

This will mean more widespread institutionalization of retail and intangible asset opportunities, which we are already seeing signs of today. The adoption of digital assets by institutions is on the rise and there is a growing “financialization” of objects that previously existed only in the hands of individuals, such as individual real estate, works of art and other collectibles.

One thing is certain, 2050 will be virtual and boundless.

David Siegel, co-founder and co-chair of Two Sigma Investments LLC

We can look at what we have right now that may be in the early stages of the internet in ’92. There’s a lot going on. The impact of cryptocurrencies is unknown. The impact of new medical technologies, such as mRNA technology, is unknown. The ability to advance in many fields using AI. These three areas, in a way, remind me of 1990 and the Internet.

It is possible that in 30 years, ongoing advances in medical technology will lead to real and meaningful cures for terrible diseases like cancer. Imagine the transformation of our civilization if we can develop treatments for some of the diseases that have plagued humanity forever. This could actually change the lives of more people than anything else.

It may turn out that accelerating climate problems – it looks like we’re getting into a bad spot here – will indeed be the dominant problem. I am very excited about the technologies that are driving the decarbonisation of the world forward.

Many of these discoveries are the result of the ability to apply computational approaches to more traditional fields: computational chemistry, computational biology and so on. So I personally believe that applying computation to solving problems with medicine, climate and so on will be the area where we will find that AI offers the most promise to improve your world.

Nir Bar Dea, co-CEO Bridgewater Associates LP

Humanity’s most difficult problems have always been solved by collaboration: people share information, build on each other’s progress, discuss different points of view and work together to shape solutions that are greater than any individual could achieve from alone.

We live in an increasingly polarized world, characterized by conflicts between and within nations, with a trust in institutions and systems that have fostered collaboration for decades in severe decline.

The most important innovations of the next few decades will be the evolution of a suite of technologies to successfully support an “open collaboration” approach. By “open collaboration” I mean the dynamic in which the best thought is made transparent to people around the world, so that others can digest it, learn from it, improve it and, ultimately, if truth and merit win, trust. it.

Today’s best collaboration technologies are often used to produce opposite results, which is why evolving them to enable open collaboration rather than polarization is critical. These technologies can enable us to make the most of our collective knowledge and resources in the face of shared problems and have the potential to significantly shape not just financial markets, but everything related to how we interact, how we work and how we innovate. .

They can serve as a way to get around the many walls that divide us, allowing people to transcend geographical and ideological boundaries, bypass wary institutions, and connect with people outside our exclusive and narrow circles.

Shemara Wikramanayake, CEO Macquarie Group Ltd.

There is no end to the opportunities in terms of responding to the climate. We have done really well with wind and solar, but we really need firming solutions in energy.

This means battery technology, microgrids, hydrogen, potentially largely, distributed grids, etc. Electric vehicles are really reaching a price where they can go up dramatically, but in long-haul transportation we need things like biofuels and aircraft fuel sustainability.

Agriculture is a big emitter and we don’t have the solutions there yet. We are investing in a lot of precision farming, but we need things: reducing food supplies of methane would be a great solution because it is a big source of emissions. In industry, of course, there is no end to the necessary solutions.

We are investing in things like hydrogen, ammonia, charging infrastructure projects to try and help large industrial fleets switch to electric vehicles. The solutions are myriad and we are investing in many of them. We are also working on solutions for plastics and recycling. So there is a lot to do. I wouldn’t try to pick the winners, but rather try everything and see what works.


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