Move over, blockchain. A.I. Is now the shiny new thing in the world of finance, according to a new JPMorgan Chase survey of traders, which saw half of respondents name the technology as likely to be the most influential in the next three years. That’s up from a quarter a year ago.
The survey findings are no doubt driven by the release of ChatGPT, a powerful new service that can perform a range of tasks from writing essays to composing sonnets to crafting recipes. The survey did not ask traders to explain how exactly A.I. Would change their profession, though a write-up of the findings cited a broader trend of automation in the world of lending and commodities. In this context, it’s not hard to imagine machines replacing the current generation of quants who program the trading strategies of many hedge funds.
All of this makes me recall my first visit to the floor of the New York Stock Exchange in 2009. I had arrived expecting to find pits of men barking out buy and sell orders like Michael Douglas in the movie Wall Street, but instead found the place to be oddly tranquil. I subsequently learned that these men—often former athletes with a loud and commanding physical presence—had been rendered mostly obsolete by Flash Boys-style math nerds with fast computers. Today, the rise of A.I. Makes it feel like we’re on the cusp of another such transition.
So how does crypto fit into all this? I’m not sure, to be honest. It’s notable, though, that influential investor Sam Altman, whose company launched ChatGPT, is also backing a crypto-based biometrics project called Worldcoin. Meanwhile, blockchain came in third among the technologies named as likely to be most influential by traders in the survey, with one analyst saying it is already further down the hype cycle than A.I. But poised to advance.
More broadly, it bears remembering that new technologies don’t operate in isolation and that it’s often a combination of them that leads to breakthroughs in the real world. One example, cited in Nick Bilton’s excellent book American Kingpin, is how the founder of the Silk Road could not have launched the online criminal marketplace if it had not been for the arrival of three new technologies—cloud computing, the Tor browser, and Bitcoin.
In the same way, it’s easy to anticipate a world—and not just a criminal one, of course—where companies deploy a mix of A.I. And blockchain to transform the landscape of trading and personal finance. The specifics are hard to envision but, in 10 years, are likely to seem obvious in hindsight. That’s how it goes when it comes to technology and the future, and what makes it all so darn interesting.
Jeff John Roberts
[email protected]
@jeffjohnroberts
DECENTRALIZED NEWS
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The offshore entity that holds $590 million worth of Robinhood stock purchased for SBF filed for Chapter 11; the Justice Department, BlockFi, and SBF are all claiming the shares are theirs. (Bloomberg)
A new slew of once buzzy projects—tZero, stablecoin Neurtrino, and Solana marketplace Everland—have gone bust, though pundits say the cause is bad products rather than Crypto Winter. (Bloomberg)
The overseers of bankrupt FTX are sending confidential letters to politicians demanding they return $93 million worth of political donations. (Coins2Day)
The Lightning Network, a Layer 2 network that facilitates cheap and rapid transfers of Bitcoin, has grown by 63% since the beginning of last year. (The Block)
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