Blockchain, AI Set To Transform Financial Markets: Moody’s
In the next five years, blockchain technologies that support cryptocurrencies could help issuers of financial instruments like bonds by reducing financing costs, claims a report by credit rating agency Moody’s Investors Service.
Implementing these technologies, according to the report, may initially result in higher IT costs and “substantial investment,” but later result in lower costs.
Moody’s report said that AI and distributed ledger technology (DLT) have the potential to transform financial markets. AI could automate manual tasks, while DLT could lower financing expenses, particularly for smaller issuers. Digital or tokenized bonds could lower transaction costs and make capital markets more accessible by bypassing intermediaries like banks. Hong Kong’s central bank also concluded similar conclusions after a successful $100 million tokenized bond issue. DLT could also help businesses capture untapped revenue opportunities and enter new markets.
(With inputs from Shikha Singh)
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