“AI’s Transformative Impact on Nasdaq’s Operations”

In a recent interview, Kathleen Koch, a best-selling author and longtime Washington correspondent, discussed the transformative potential of AI in the financial sector with John Zecca, Executive Vice President and Chief Legal, Risk, and Regulatory Officer for Nasdaq. Nasdaq, known for its history of innovation, has been leveraging AI for various applications, including executing trades and preventing financial crime. Zecca highlighted the importance of foundational investments in technology and data, which have enabled Nasdaq to effectively integrate AI.
One significant development is Nasdaq’s AI-powered order type, the Dynamic Midpoint Extended Life Order (Dynamic M-ELO), approved by the SEC, which enhances market stability and fill rates. Additionally, Nasdaq’s Verafin product uses AI to streamline anti-money laundering investigations, improving efficiency by up to 30%.
Zecca also discussed Nasdaq’s initiative to provide generative AI tools to all employees, emphasizing the importance of a robust governance structure and education to ensure safe and effective use. He noted that while regulators globally are considering AI legislation, it is crucial to balance regulation with flexibility to adapt to technological advancements. Industry standards and collaborations may provide a more adaptable framework for AI regulation.
The interview concluded with a discussion on the need for thoughtful regulation that supports innovation while mitigating risks. Viewers were encouraged to join the conversation on social media using the hashtag #PostLive.