Modernization and AI Dominate the Discussion at Nasdaq Market Structure Seminar

Financial industry leaders gathered at Nasdaq's Market Structure Seminar on February 11 to explore emerging trends shaping the global markets, with artificial intelligence and regulatory evolution standing out as central themes at the top of everyone’s mind in the global financial system.

The seminar brought together executives, product managers, and market structure experts from leading banks and financial institutions to examine shifting dynamics in market infrastructure and technology adoption.

Nasdaq executives leading the discussions included Valerie Bannert-Thurner, Executive Vice President and Chief Revenue Officer of Financial Technology; Carl Slesser, Vice President and Head of Trading Technology; Phil Mackintosh, Senior Vice President and Chief Economist; and Andrew Oppenheimer, Head of US Equities Sales and Business Development. Through a series of discussions, participants explored how technological advancements and regulatory changes are challenging market participants to adapt to a new world.

"We think of the future of market structure as a modern fabric to drive economic progress," said Valerie Bannert-Thurner following the seminar. "The vision is for markets to become truly global, connected, and frictionless—with thriving ecosystems built entirely on cloud infrastructure."

Carl Slesser emphasized that the seminar was crucial in getting feedback from Nasdaq’s global client base from the sell-side and financial market infrastructure communities.

“Our clients are all going through modernization journeys, and it was great to highlight some of their key achievements in that area,” Slesser said. “And we looked ahead to what modernization could mean in the market structure arena.”

A key theme of the discussions was AI’s growing prominence in financial markets. "We have to take a thoughtful and long-term approach when we look to adopt and integrate emerging technologies like artificial intelligence," Bannert-Thurner said, summarizing the seminar discussions. "It's about ensuring we can scale our capabilities, tools, and systems with proper governance, security, and oversight."

"Everything is going to be data-centric moving forward," Bannert-Thurner emphasized. "AI is no longer a buzzword."

Having recently returned from the annual meeting of the World Economic Forum in Davos, Bannert-Thurner shared that many financial institutions are rapidly integrating AI capabilities, with some mandating AI-first approaches to operations. The technology is expected to drive significant operational efficiencies allowing firms to redirect resources toward competitive initiatives. This shift toward AI adoption is already showing results in areas like engineering productivity, where AI assists with code development.

At the seminar, Andrew Oppenheimer addressed evolving market dynamics, particularly the shift in liquidity patterns and the movement of trading activity to off-exchange venues—a trend that could present broader challenges for market efficiency and costs. Mackintosh’s session focused on macro trends in the economy and how they are tied into market structure.

A recurring theme was how to balance innovation and operational complexity. Recent analysis by Nasdaq and the Boston Consulting Group indicates that while external market complexity has increased sixfold over the past five decades, internal organizational processes have become 35 times more complicated. This disparity underscores the need for streamlined approaches to market modernization.

Following the event, Slesser pointed out three reasons why it was important for thought leaders to gather and discuss market structure in depth. “One is to share people’s challenges in this space. Is everyone experiencing the same challenges? Two, it helps Nasdaq respond to those from a product point of view, ensuring we’re helping our clients in the right way,” Slesser explained. “And finally, of course, to share and network.”

Through seminar discussions, three challenges stood out among participants:

Managing Technology Integration: Because the implementation of new technologies like AI can be complicated, Nasdaq relies on five core pillars to oversee the process: data management quality, intentional cloud infrastructure investment, mature security posture, appropriate governance frameworks, and cultural transformation through employee upskilling. Nasdaq's North Star is its ambition to cultivate the quality of its markets and commitment to delivering innovative products and tools that benefit all market participants.

Regulatory Adaptation: Market participants are seeking ways to navigate an increasingly complex regulatory landscape while maintaining operational efficiency. External challenges include rapidly changing technology, regulatory complexity, geopolitical uncertainty, and financial crime, while internal complications stem from the accumulation of procedures, interfaces, and decision approvals leading to inefficiencies. This also includes addressing new requirements around data residency and third-party oversight. Particular attention is being paid to evolving frameworks like DORA and GDPR, which introduce additional compliance obligations for global operations.

Extended Trading Hours: The move toward 24/7 trading introduces opportunities for more economic dynamism but also introduces the daunting challenge of facilitating it from a logistical standpoint.

Looking ahead, participants explored the implications of other emerging technologies on market structure. Blockchain and digital assets are moving beyond cryptocurrency trading into mainstream financial applications, including payments and collateral management, as well as assisting with core banking operations.

The discussions reinforced Nasdaq CEO Adena Friedman's view that innovation should be viewed as an ecosystem rather than a singular goal. In the aim of nurturing that ecosystem, she has recently highlighted the need for approximately $80 trillion in long-term capital to drive transformative developments in energy transition, infrastructure modernization, and artificial intelligence advancement.

The seminar encouraged participants to ponder financial technology's vision for market structure over the next three to five years. What emerged was the desire for an international financial structure that is adaptable to changing participant needs while maintaining efficiency and transparency. Key to this vision is the development of truly fungible markets where risks can be transferred seamlessly, capital access is democratized, and data accessibility is universal and fair.