BNP Paribas takes a leaf out of Silicon Valley’s book with a Siri-style digital trading assistant, which is launching alongside real-time market analytics and interactive algorithms as part of major upgrade to the bank’s Cortex FX trading platform.

September 12, 2019 7:32 AM GMT

BNP Paribas has unveiled its newly revamped FX algorithmic trading platform following a major upgrade, which includes the launch of interactive algo­rithms and real-time analytics delivered via an artificial intelligence-based digital trading assistant known as ‘ALiX’.

ALiX, which BNP Paribas said is the FX industry’s first digital trading assistant, will deliver content and running commentary on execution to traders using the bank’s modernised Cortex LIVE platform. As market participants continue to battle with the onslaught of data volumes, ALiX will digest market information, presenting tangible options to improve algo execution mid-flight, effectively giving BNP Paribas’s FX algo­rithms a voice.

“We’ve taken a leaf out of Silicon Valley’s book with ALiX,” says Asif Razaq, global head of automated client execution (ACE) at BNP Paribas. “Similar to the concept of Alexa or Siri, ALiX was designed to focus on financial markets. These assistants are solving multiple workflow problems. ALiX is designed to be your personal trading assistant, where it will monitor multiple live market data feeds with­in our real-time analytics portal.

“ALiX will also intelligently inform the client of any key market events and present context relevant options to choose from, ulti­mately providing the client with an intelligent roadmap of what to do next.”

Alongside ALiX, BNP Paribas has launched its Cortex LIVE platform with a real-time market analytics portal, known as Insight LIVE, which the digital trading assistant will use to deliver market content, data and intel­ligence to traders.

Insight LIVE builds on the FX pre- and post-trade transaction cost analysis (TCA) that BNP Paribas already offers clients through its Insight portal, however, the Insight LIVE data has been expanded to in­clude real-time information to bridge the gap between the pre- and the post-trade TCA.

Navigating the execution flight path 

BNP Paribas launched its FX single-dealer platform, Cortex, in 2013 at a time when FX markets were undergoing a major evolution following the introduction of algorithmic trading and electronic trading platforms. FX markets first adopted the basic TWAP and VWAP algo trading strategies from equi­ties, but as the arrival of multiple new FX execution platforms caused fragmentation in liquidity, second generation algorithms were rapidly developed to aggregate that liquidity across numerous venues.

Although slightly late to the party, BNP Paribas says it pioneered the third generation of FX algorithms. Razaq, who has been part of the FX algorithmic trading team at BNP Paribas for almost a decade, was tasked with developing the bank’s expedition into FX algorithms and soon developed what would become the third generation algo: adaptive algorithms.

Razaq says he deployed basic forms of AI technology and real-time insights so that the algos can self-adjust when working a trade. At that time, BNP Paribas launched two adaptive algorithms, Chameleon and Viper, providing clients with both aggressive and stealthy algo trading strategies when the Cortex platform first went live.

“Execution algorithms have grown in use in the FX space, whereas in the equities space, they’ve existed for a very long time,” Razaq adds. “FX algorithms were more difficult to build due to a lack of transparent data and fragmented liquidity. As we saw the elec­tronification of the FX market take place, we started to develop models to gather market intelligence and were able to build algos that adapt in real-time.

“It was a greenfield project in terms of having a blank slate, and this is where I really wanted to utilise my expertise in artificial intelligence. Can I build something using basic AI techniques that will give us an edge, to improve on what the market is doing with the first and second generation algos? We also wanted to simplify the algo journey, because clients think of algos and see complexity. Sim­ plicity was key. When BNP Paribas launched its algo platform, one of the key objectives I set myself was not to overcomplicate the algo selection process for the client.”

Simplicity has remained a key part of Cortex following the revamp, and rather than build­ing several different algorithms, BNP Paribas focused on enhancing its existing Chame­leon and Viper algo strategies. While clients found value in the self-piloting and adaptive algorithms BNP Paribas had developed, the bank says many wanted to be more involved in the algo execution process. To meet this demand, BNP Paribas has introduced what it is referring to as the ‘fourth generation’ of FX algorithms: interactive algos.

The interactive algorithms provide a view of the data it is processing and reacting to from the Insight LIVE market data hub, allowing clients to consider various options for order execution. But, rather than running the algo on autopilot, as has traditionally been the case, traders are handed the controls to turn off autopilot and navigate the execution path, based on real-time analytics delivered via ALiX.

The four pillars 

The FX algo trading team at BNP Paribas focused on four pillars when building Cortex LIVE; user experience, market analytics, integration and intelligence. For user expe­rience and integration, market participants have a multitude of single-dealer platforms to choose from, all of which are competing aggressively for client desktop real-estate. Expert user interface developers were brought in by BNP Paribas to examine the Cortex platform and map out the user’s journey to identify where that workflow could be streamlined or simplified.

Simultaneously on the client side, firms are upgrading or implementing digital infrastruc­tures to automate their own workflow, so BNP Paribas says it is imperative that Cortex LIVE can be integrated within the whole FX ecosystem and with client workflows. In order to achieve this, BNP Paribas teamed up with financial markets operating systems specialist and industry disruptor, OpenFin.

 “Cortex Live is the first external platform that BNP Paribas has put on OpenFin, but the bank has been a supporter of OpenFin in terms of internal use cases for many years,” explains Adam Toms, CEO of OpenFin Europe. “With the development of the new major integration process platform, BNP Paribas adopted some of the best components that OpenFin has to offer, including the FDC3 interoperability stan­dards and user experience. It is a big step for­ward and, frankly, any organisation moving forward with interoperability is going to be a market leading vendor.

“It’s encouraging to see, given my back­ground and that FX has historically been an asset class with a lower level of transparen­cy, that BNP Paribas has made a real push with transparency, with real-time TCA and in-depth venue analysis. That is a powerful differentiation.”

Onboarding clients, particularly the more traditional asset managers, to a new plat­form can be a headache in terms of legal paperwork and getting the system onto client desktops. To address this, BNP Paribas has ensured that the Cortex LIVE platform is ac­cessible and downloadable via the app store on Bloomberg, which means that clients can download the platform within the Bloomberg ecosystem without having to go through a major integration process. For those that often struggle to keep track of usernames and passwords, Cortex LIVE clients will not even have to log in, as Bloomberg is able to authen­ticate a client’s system for easy access.

“Cortex LIVE being available via Bloomberg removes that integration barrier, and that’s why we expect the adoption rate of clients consuming Cortex LIVE to be significant,” says Nick Hamilton, head of EMEA eFX sales at BNP Paribas. “It streamlines and simpli­fies workflow. Clients just have to download the platform from the Bloomberg app store and they’ll have access to all of the enriched functionality.”


With the OpenFin integration, BNP Paribas claims it is ‘future-proofing’ the new platform and, eventually, systems on the client side will be able to communicate with BNP Parib­as’ digital trading assistant to create a fully automated and integrated trading platform. Although the FX industry is not quite at this stage yet technologically speaking, BNP Pari­bas has laid the foundations to take ALiX and Cortex LIVE a step further.

In the early days, ALiX will be fed with basic responses, but the machine will self-learn and be able to respond, building a rapport with the client as they ask the digital trading assistant more questions. As ALiX is given more data its intelligence will grow and broaden its remit from guiding clients not just through their FX algo trading execution, but for all FX activities.

“The vision is that we will broaden the ALiX concept as a holistic solution across the FX execution environment for all of your activities as a user on Cortex,” says Joe Nash, digital FX chief operating officer at BNP Paribas. “Then it becomes more than the execution control point for the algo business, it will be a digital trading assistant for every­thing you’re doing in the FX space. Pushing content, trade ideas, figuring out when you expect to put a particular trade on and provide pricing to you in that regard, there’s a whole sphere of functionality that we can bring to the FX space through ALiX.”

In the long-term, BNP Paribas aims to take the new technologies in the form of ALiX and the new functionality and analytics on Cortex LIVE to other financial instruments and asset classes. Cortex LIVE, ALiX, as well as interactive algos Chameleon and Viper, could soon embark on a journey into equities or fixed income. BNP Paribas says this expan­sion is being considered amid a trend towards multi-asset trading in asset management.

“We are now looking to extend our award-winning algo execution service to other asset classes such as fixed income, futures and so on. This is against the backdrop of the buy-side consolidating their activities and forming multi-asset trading desks. Eventually, we want ALiX to become that multi-asset BNP Paribas trading assistant,” Razaq concludes.

Estimates of venture capital funding for HR technology point to record levels of more than $5 billion in 2019. Some of the recent activity in talent acquisition includes: Entelo acquired ConveyIQ along with new funding and management changes; HireVue received another round of funding via new majority investor The Carlyle Group; Jobvite received a $200M majority investment from K1 Investment Management and is merging Jobvite with Talemetry, RolePoint, and Canvas; and iCIMS acquired Jibe. Other areas in the human capital management (HCM) market are experiencing the same activity. In the performance management area, Culture Amp just closed $82M of funding.

Considering that HR and HCM technology are generally mature areas, it begs the question: Is there that much left to do for HR professionals, executives, managers, and employees?

While company valuations for investment are always debatable, the fact remains that there is more to do — a lot more. In fact, the combination of external and internal forces continues to create a frenzy of HCM solution innovation.

External forces put pressure on HR software innovation, such as evolving workforce expectations shaped by continuous changes to workforce composition, global political and economic conditions, consumer technology influence combined with faster software innovation cycles, increased data security and regulatory concerns, and the continued evolution of business goals and corporate values.

As these external forces mount, HR pros, managers, and employees are faced with internal challenges that have yet to be really solved well, such as: “How do I continuously attract the best talent? How do I get a clear understanding of my workforce composition? How do you remove HR ‘speed bumps’ that slow down employee productivity? How can I understand my organization’s skills so I can clearly see the gaps and provide learning? How do you make learning flow in the course of everyday work? How do I better understand the employee experience and improve engagement and retention? What’s the best way to provide HR services for managers and employees? Can I really take a data-based approach to HR? If so, how?”

To help you make sense of this market and flourish in this frenzy, I will be releasing the Forrester Tech Tide™: Human Capital Management, Q3 2019. It will provide a road map to the current HCM landscape so you can better navigate your HCM investments. In fact, there has never been a better time to rethink your HCM technology.

As we move into the fall events season, with HR technology conferences and vendors looking to create some customer magic, it will be interesting to see how this all shapes up. To learn the results of the Tech Tide and get some firsthand insight on how the events and innovations are unfolding, be sure to sign up for my webinar on Thursday, September 26.

Top 5 Things to Know in the Market on Tuesday

© Reuters.

The specter of deflation in China rears its ugly head, and the manufacturing slowdown shows no sign of ending in Japan and Europe. Plus there’s trouble in IPO world, as WeWork’s deal comes under pressure. Here are the top 5 things you need to know in financial markets on Tuesday, 10th September.

  1. Gloomy data, China noises

The risk of China exporting deflation to the rest of the world is on the rise. Figures released overnight showed Chinese producer prices fell at their fastest rate in three years in August, underlining the problems faced by a manufacturing sector largely dependent on access to the U.S. market.

Also, Japan said that orders to machine tool makers fell by 37% on the year, the lowest since 2009, in another reflection of how the prevailing uncertainty around trade and Brexit is hammering business investment. French and Italian industrial production data for July, released earlier, also fell short of forecasts.

At 10 AM ET, the Bureau of Labor Statistics will release its JOLTS job opening survey for July, which will add some incremental insight into a labor market that appeared to be running out of workers in the government’s official report for August last week.

  1. Stocks set to open lower

Wall Street is set for a lower opening after the largely gloomy data from Asia and Europe reminded markets that the global slowdown is still very much a thing.

By 6 AM ET (1000 GMT), Dow futures were down 39 points or 0.1%, while S&P 500 Futures were down 0.2%. Nasdaq 100 Futures were also down 0.2%, against a backdrop of increasing U.S. regulatory scrutiny of Google (NASDAQ:GOOGL) and Facebook (NASDAQ:FB).

However, haven assets aren’t faring any better. Both bonds and gold are selling off slightly, after explosive rallies in recent weeks. The 30-year Treasury yield was at 2.11%, while gold futures lost ground for a fourth straight day to $1,502.65 an ounce.

Citigroup (NYSE:C) and other financials will be in focus later after the company said on Monday it expected a drop in trading income in the third quarter.

  1. WeWork IPO under threat; Aramco’s moves forward

One of the year’s biggest IPOs may be about to be pulled. The We Company, parent of loss-making office space provider WeWork, is under pressure from Softbank, its biggest external backer, to postpone an initial public offering that was supposed to take place this month.

Reports have indicated that marketing for the IPO was supposed to start this week, but have been snagged by valuation and governance concerns.

However, another much-hyped offering looks a big step closer after Saudi Aramco’s chief executive Amin Nasser told a conference that banks to lead the offering will be chosen “soon.” The bad news for U.S. investors is that Aramco, the world’s most profitable company, is due to be listed only in Riyadh to start with, followed by a foreign listing – most likely in Tokyo – at an unspecified later date.

Read More: Will Oil Markets Finally Be On The Side Of The New Saudi Minister?

  1. Boris thwarted, again

The British pound consolidated recent gains after the U.K. House of Commons thwarted Prime Minister Boris Johnson’s plans to hold a general election before the country’s scheduled departure from the EU on Oct. 31.

The defeat – Johnson’s sixth in parliament in little more than a week – further reduces the chance of a disorderly Brexit in the fall, although popular discontent at the arcane maneuvering in parliament still means that Johnson could emerge the winner from an election when it is finally held.

Analysts at JPMorgan (NYSE:JPM) told clients in a note that: “The only options we regard as ultimately viable are for the Prime Minister to present a deal to the Commons and secure approval for it, resign and let someone else make the extension request as PM, or back away from his stated position. At this point, our view is that resignation is the most likely of these three.”

The opposition-led bill requiring Johnson to ask the EU for an extension to the Brexit deadline if he can’t secure a transitional deal entered into law on Monday. Data released earlier showed the U.K. labor market holding up surprisingly well, suggesting that the U.K. will avoid entering recession in the third quarter.

  1. PG&E proposes reorganization plan

California-based utility Pacific Gas & Electric (NYSE:PCG) presented a plan to settle billions of dollars in wildfire-related claims and exit bankruptcy next year and escape its creditors.

The preliminary proposal envisages raising billions in debt and equity to cover fire damages and emerge from bankruptcy court by June 2020, according to The Wall Street Journal. But PG&E’s liabilities from years of fires are still uncertain and the company hasn’t decided on exactly how it will raise the money, the WSJ, citing papers filed with the relevant court.

Jobs in banking are some of the most sought after for job seekers — but plenty of roles may not be around much longer. 

Despite a year of scandals that entangled many of the country’s largest banks, the desire to work at these companies remains high, according to a new report by LinkedIn. Some of the more high-profile scandals include Deutsche Bank‘s alleged involvement in a global money-laundering scheme and accusations against Well Fargo‘s auto-loan and mortgage practices. 

Nonetheless, Bank of America, Goldman Sachs, Citigroup, Wells Fargo, and JPMorgan Chase remain five of the most popular places to work in 2019. LinkedIn attributes the popularity to banks offering increasingly tech-focused jobs that attract talented software engineers and developers out of college. 

Read more: The 30 hottest companies of the year, according to LinkedIn

“The reality is that if somebody wants to learn finance and strategy, these banks are still the places to be trained and developed,” Heather Hammond, co-head of the global banking and markets practice at Russell Reynolds Associates, told LinkedIn

While job seekers may be flocking to banks at the current time, a new report revealed a million jobs in the industry could disappear in just over 10 years. Job losses or reassignments will impact 1.3 million bank workers in the US alone by 2030, according to a new report from British insights firm IHS Markit. Especially at-risk roles include customer-service reps, financial managers, and compliance and loan officers. 

Though the most at-risk jobs seem to be lower-paying, jobs in banking as a whole are some of the most expensive in the country. Starting analysts make $91,000 in base pay, while managing directors can earn almost $1 million after bonuses. In fact, the industry could add a whopping $512 billion in global revenue by 2020 with the use of intelligent automation, according to a 2018 report from Capgemini

While the use of AI remains sparse, and the technology is still basic, a boost in revenue will increase the adoption of automation, Business Insider analyst Lea Nonninger reports

Unfortunately for job seekers, banks’ investment into automation is well under way. In fact, a detailed 2018 report from Business Insider Intelligence noted that banks are already using AI to mimic bank employees, automate processes, and preempt problems. JPMorgan is cleaning thousands of databases to make room for machine learning tech. Citi president Jamie Forese said in 2018 that robots could replace as many as 10,000 human jobs within five years. 

Laura Barrowman, chief technology officer at the Swiss investment bank Credit Suisse, revealed the company is already retraining employees whose jobs have been displaced by AI: “Globally, if you look at cyber skills, I think there is a deficit,” Barrowman told Business Insider’s panel at the World Economic Forum earlier this year. “There is such a shortage of skills, and you need people who have that capability.”

(Bloomberg) — For an investor whose story was featured in a best-selling book and an Oscar-winning movie, Michael Burry has kept a surprisingly low profile in recent years.

But it turns out the hero of “The Big Short” has plenty to say about everything from central banks fueling distortions in credit markets to opportunities in small-cap value stocks and the “bubble” in passive investing.

One of his most provocative views from a lengthy email interview with Bloomberg News on Tuesday: The recent flood of money into index funds has parallels with the pre-2008 bubble in collateralized debt obligations, the complex securities that almost destroyed the global financial system.

Burry, who made a fortune betting against CDOs before the crisis, said index fund inflows are now distorting prices for stocks and bonds in much the same way that CDO purchases did for subprime mortgages more than a decade ago. The flows will reverse at some point, he said, and “it will be ugly” when they do.

“Like most bubbles, the longer it goes on, the worse the crash will be,” said Burry, who oversees about $340 million at Scion Asset Management in Cupertino, California. One reason he likes small-cap value stocks: they tend to be under-represented in passive funds.

Here’s what else Burry had to say about indexing, liquidity, Japan and more. Comments have been lightly edited and condensed.

Index Funds and Price Discovery

“Central banks and Basel III have more or less removed price discovery from the credit markets, meaning risk does not have an accurate pricing mechanism in interest rates anymore. And now passive investing has removed price discovery from the equity markets. The simple theses and the models that get people into sectors, factors, indexes, or ETFs and mutual funds mimicking those strategies — these do not require the security-level analysis that is required for true price discovery.

“This is very much like the bubble in synthetic asset-backed CDOs before the Great Financial Crisis in that price-setting in that market was not done by fundamental security-level analysis, but by massive capital flows based on Nobel-approved models of risk that proved to be untrue.”

Liquidity Risk

“The dirty secret of passive index funds — whether open-end, closed-end, or ETF — is the distribution of daily dollar value traded among the securities within the indexes they mimic.

“In the Russell 2000 Index, for instance, the vast majority of stocks are lower volume, lower value-traded stocks. Today I counted 1,049 stocks that traded less than $5 million in value during the day. That is over half, and almost half of those — 456 stocks — traded less than $1 million during the day. Yet through indexation and passive investing, hundreds of billions are linked to stocks like this. The S&P 500 is no different — the index contains the world’s largest stocks, but still, 266 stocks — over half — traded under $150 million today. That sounds like a lot, but trillions of dollars in assets globally are indexed to these stocks. The theater keeps getting more crowded, but the exit door is the same as it always was. All this gets worse as you get into even less liquid equity and bond markets globally.”

It Won’t End Well

“This structured asset play is the same story again and again — so easy to sell, such a self-fulfilling prophecy as the technical machinery kicks in. All those money managers market lower fees for indexed, passive products, but they are not fools — they make up for it in scale.”

“Potentially making it worse will be the impossibility of unwinding the derivatives and naked buy/sell strategies used to help so many of these funds pseudo-match flows and prices each and every day. This fundamental concept is the same one that resulted in the market meltdowns in 2008. However, I just don’t know what the timeline will be. Like most bubbles, the longer it goes on, the worse the crash will be.”

Bank of Japan Cushion

“Ironically, the Japanese central bank owning so much of the largest ETFs in Japan means that during a global panic that revokes existing dogma, the largest stocks in those indexes might be relatively protected versus the U.S., Europe and other parts of Asia that do not have any similar stabilizing force inside their ETFs and passively managed funds.”

Undervalued Japan Small-Caps

“It is not hard in Japan to find simple extreme undervaluation — low earnings multiple, or low free cash flow multiple. In many cases, the company might have significant cash or stock holdings that make up a lot of the stock price.”

Read more: Michael Burry Discloses Investments in Five Japanese Companies

“There is a lot of value in the small-cap space within technology and technology components. I’m a big believer in the continued growth of remote and virtual technologies. The global retracement in semiconductor, display, and related industries has hurt the shares of related smaller Japanese companies tremendously. I expect companies like Tazmo and Nippon Pillar Packing, another holding of mine, to rebound with a high beta to the sector as the inventory of tech components is finished off and growth resumes.”

Cash Hoarding in Japan

“The government would surely like to see these companies mobilize their zombie cash and other caches of trapped capital. About half of all Japanese companies under $1 billion in market cap trade at less than tangible book value, and the median enterprise value to sales ratio for these companies is less than 50%. There is tremendous opportunity here for re-rating if companies would take governance more seriously.”

“Far too many companies are sitting on massive piles of cash and shareholdings. And these holdings are higher, relative to market cap, than any other market on Earth.”

Shareholder Activism

“I would rather not be active, and in fact, I am only getting active again in response to the widespread deep value that has arisen with the sell-off in Asian equities the last couple of years. My intention is always to improve the share rating by helping management see the benefits of improved capital allocation. I am not attempting to influence the operations of the business.”

Betting on a Water Shortage.

“I sold out of those investments a few years back. There is a lot of demand for those assets these days. I am 100% focused on stock-picking.”

A multi-billion-dollar asset management company plans to use the Stellar blockchain for a new fund.

Franklin Templeton Investments filed a preliminary prospectus with the U.S. Securities and Exchange Commission Tuesday for a money market fund whose shares would be recorded on the Stellar Network. The plan requires the SEC’s approval.

To be clear: the fund would not invest in any cryptocurrencies or crypto projects. Rather, “the ownership of the Fund’s shares may be maintained and recorded solely on the Stellar network,” the prospectus says.

According to the prospectus, the money fund would seek a $1 per share net asset value (NAV) with 99.5 percent of its investments in government securities, cash, and repurchase agreements further backed by government securities or cash.

Shares would purchasable on the asset manager’s online app but not on the secondary market. Minimum purchases start at $20.

The prospectus says Franklin Templeton believes blockchain-based shares provide transparency for shareholders but warns they come with their own risks, including hacking and loss of funds.

As such, the firm cautioned that its Stellar project is a test and the fund is liable to liquidation if decided upon by Franklin Templeton.

With over $700 billion in assets under management, Franklin Templeton, based in San Mateo, California, ranks among the top 35 mutual fund managers.

Benjamin Franklin image via Shutterstock

Crypto Firms Serving Netherlands Must Register With Dutch Central Bank

The Dutch Central Bank is taking a tougher stance on the cryptocurrency industry, citing new European Union anti-money laundering (AML) laws.

Beginning Jan. 10, 2020, companies or persons involved in the conversion of crypto to fiat currencies or offering crypto deposit services will be required to self-register with the De Nederlandsche Bank (DNB), the DNB announced Tuesday.

The order includes firms based outside the Netherlands that are serving Dutch nationals, even via the internet.

“It is irrelevant whether they are established in the Netherlands,” a DNB representative said in a Q&A, adding:

“Also providers that offer such services from another EU member state … for example via a website, must register, regardless of whether the provider is already registered in that member state.”

DNB says the oversight is to meant to comply with the fifth EU Anti-Money Laundering Directive (AMLD 5), which will also go into effect on Jan. 10, 2020.

The initial registration period will last six months after the January date. Companies that fail to submit registration beforehand could be forced to shut down once the rules go live, the DNB said.

“During these six months you must therefore already comply with the requirements of the law,” the DNB said. “If, at the time the law comes into force, you have not submitted a request for registration, you must stop your service.”

Further, significant shareholders and directors must also be able to prove their AML ability to a DNB assessment.

Under AMLD 5, member states must issue crypto regulations adhering to the policy before Jan. 10. Interpretation of what regulations must be considered or created falls to each state’s discretion, the release says.

In the Netherlands, the DNB will take into account past actions of each company in addition to the “the specific function, the nature, size, complexity and risk profile of the company, and the composition and functioning of the collective.”

Earlier this spring, the Dutch Financial Criminal Investigative Service shut down coin mixer, seizing multiple servers in the Netherlands and Luxembourg.

I’m Here to Tell You What Most People Won’t.

Your project almost definitely won’t benefit, even 1%, from choosing to use Blockchain. You’re not using it for anything innovative that a centralized Oracle database couldn’t do twenty years ago. That’s what the posturing Blockchain influencers and engineers looking to make a quick buck fail to share. They’re doing absolutely nothing which is new or innovative.

What you’re doing is building a vanity project which strokes your own ego. You’re not using blockchain technology because you have to, you’re using it because you want to and think that it will impress other people. That’s sad.

The same is almost universally true for AI and Machine learning by the way. Both have rotted to become empty adjectives used to describe functions which have no characteristics of either. They amount to little more than fancy parlor tricks involving automated bots which act in a very small, specific niche.

The sad reality is that we live in the replication age, the desires to innovate are nowhere to be found. Instead, people focus mindlessly on the replication of the existing. They take what use in their analog world and espouse about how their imagination of this thing recreated for a digital decentralized age will change the world. Sure, it might sound impressive but when you analyze the details…

There is a fundamental misunderstanding of what decentralization even is, its purpose and why it would ever be a means to an end. Without understanding that in first principles we are sentenced to repeat the mistakes of the past. Much like the dot com explosion, crypto and Blockchain will encounter its own reckoning and it is fast approaching. It becomes so difficult to see the wood for the trees that absolutely everything you encounter either looks revolutionary or like a dumpster fire about to REKT the universe.

You Thought the Crash of 2018 was it?

Not even close. That was, in fact, public sentiment running wild and had next to no bearing on the investment or innovation in the space. Yes, ICO’s were an investment but not in the way that it typically matters, i.e. the money raised came from the pockets of ‘unsophisticated investors’ (not a term I used fondly but apt for this purpose).

That meant that these projects were white elephants funded on nothing but sketches on the back of a fag packet.

There was no diligence done on any of them and they raised capital on a white paper. Rather than focus on things that were real and already had working prototypes, the focus drifted to nothing but the financial reward. As it turns out, greed as an incentive to participate is an unlikely route to oversized returns.

Institutional capital certainly has its faults, but for the most part, it can be relied upon to fund projects which conform to a very specific set of expectations. This in no way guarantees their success, or that the investments made are to people who reflect the range of diversity in the world, but their diligence on investments fall somewhere above a whim and a prayer.

And that is a great pity. We focussed on the low hanging fruits, which is typically fine when focussing on such novel technology, but on this occasion, it turned out that they were rotten. The low hanging fruits weren’t sweet.

The solution then is to demand better and develop honesty. It’s about ensuring we act with integrity rather than ego. It’s about being braver and bolder and embracing the possibility of failure in the hopes of arriving at a far more exciting destination.

Are you recreating the wheel? If so, use the wheel that already exists.

Don’t let your ego lead to compounding misery like so much of the projects that exploded and have now crashed and burned.

Blockchains promise is clear. It could enable trust in a trustless world. A final solution to the ephemeral problem of the Byzantine general. Where intermediaries have historically been required to ensure trust, technology can first reduce our reliance before rendering them completely unnecessary.

That means Airbnb without the need for the platform to take a cut of your profits. It means Uber without the faceless shark that everyone seems to hate.

Blockchain’s killer app hasn’t been invented yet.

That’s because of human greed and individual selfishness. Rather than building the impossible, we shirk the responsibility and take the easy route.

The brutal truth of blockchain is that, like Thor’s hammer, few are worthy to wield its power.

Unlike Thor’s hammer, it is your Imagination and Bravery to dream that dictate whether you ever Will

  • Singapore is about to shake up its banking sector for the first time in two decades that would allow technology players and non-banking firms to challenge traditional lenders.
  • The disruption could be a win-win situation for consumers, according to marketing information services company J.D. Power.
  • The Monetary Authority of Singapore on Thursday said it will now accept applications for the five new digital bank licenses that will be up for grabs until the end of the year.
GP: Singapore banks 190830

A customer uses an automated teller machine in Singapore.Nicky Loh | Bloomberg | Getty Images

Singapore is about to shake up its banking sector for the first time in two decades — a move that would allow technology players and non-banking companies to challenge traditional lenders. The disruption could be a win-win situation for consumers, according to marketing information services company J.D. Power.

The Monetary Authority of Singapore on Thursday said it will now accept applications for five new digital bank licenses until the end of the year.

MAS, both a regulator and the central bank of Singapore, announced in June that virtual bank licenses will be issued as part of “Singapore’s banking liberalization journey.”

The regulator will distribute up to two digital full bank licenses, which will allow non-banking entities to take deposits from retail customers. It also plans to issue up to three digital wholesale bank licenses for companies to serve small and medium-sized businesses and other non-retail segments.

Applicants have to meet a number of eligibility criteria, which includes showing they can manage a sustainable digital banking business and demonstrating experience in the technology or e-commerce sectors.I think that’s a win-win-win for customers right now.Anthony ChiamJ.D. Power

Digital full bank applicants must be “anchored in Singapore, controlled by Singaporeans and headquartered in Singapore,” according to MAS. Wholesale digital banks, meanwhile, can be controlled by either Singaporeans or foreign entities.

Who wins?

“It’s well overdue, in terms of more choices for customers,” Anthony Chiam, regional practice leader for global business intelligence at J.D. Power, told CNBC.

Singapore’s banking sector is dominated by three major local banks — DBS Group, Oversea-Chinese Banking Corp, and United Overseas Bank. A number of international banks with comparatively smaller operations are also key players. Still, technological progress in the city-state has led to the presence of a variety of financial technology, or fintech firms, which provide digital payments, online money transfers and remittance services, among others.

MAS’ decision to issue those licenses came afterthe Hong Kong Monetary Authority gave out eight virtual banking licenses this year in a sector dominated by big lenders such as HSBC, Standard Chartered and various Chinese banks. The moves from regulators in Singapore and Hong Kong are part of a broader shifting trend where more and more people in Asia are turning to online banking services.

New data from research and advisory firm Forrester found many users across the region said they believe they should be able to accomplish any financial task on a mobile device.

“The adoption of digital banking is about to accelerate and reach new levels of scale in Asia Pacific. Pioneers such as WeBank and Kakao have foreshadowed what is on the way, but this is just the beginning,” Forrester analysts wrote in a report, titled “The Pulse of Financial Services Customers In Asia Pacific,” which was released last month.

J.D. Power’s Chiam explained that the selected entities that ultimately receive the digital bank licenses in Singapore would have been thoroughly vetted by the monetary authority’s strict standards, which would make them more reliable. “I think that’s a win-win-win for customers right now,” said Chiam.

Who can apply for the licenses

MAS said the forthcoming digital lending licenses would be extended to non-bank players to keep Singapore’s banking sector competitive and resilient. “These new digital banks are in addition to any digital banks that Singapore banking groups may already establish under MAS’ existing regulatory framework,” the regulator said in a statement.

Following the initial announcement in June, a number of non-banking companies including Singapore Telecommunications and ride-hailing giant Grab expressed preliminary interest in applying for those licenses.

Grab, which has a sizable financial business across Southeast Asia that includes a digital payment service and an electronic wallet, said it is studying the newly released framework from MAS closely.

“We believe digibanks will make banking and financial services accessible and more convenient to a greater number of people in Singapore,” a Grab spokesperson told CNBC by email. “We will be keen to apply for the license once we have evaluated the framework.”

Gaming hardware manufacturing firm Razer, which also has a digital payments business, is another company that’s expressed interested in applying for one of those licenses.

“Razer is keen to explore applying for the digital full bank license through our Razer Fintech arm,” Jasmine Ng, CEO of Razer Fintech, said in a statement last Thursday. “Since we announced our interest in the digital bank license back in June, we have had many parties approach us for partnerships.”

GP: Monetary Authority of Singapore 190701

Signage for the Monetary Authority of Singapore (MAS) is displayed outside the central bank’s headquarters in Singapore.Sam Kang Li | Bloomberg | Getty Images

Given that the total number of licenses available is limited to just five, it is likely that many companies would band together into consortia to apply, according to Varun Mittal, global emerging markets fintech leader at professional services firm EY. He explained that those partnerships would be formed along four main areas: distribution, technology and operations, product and capital.

“I would expect most of the winners to be (consortia). The number of licenses is limited, it’s fixed,” he told CNBC. “It’s better you do the consortium beforehand because the premise is, you have only four months.”

For its part, MAS said Singapore banking groups, which are already governed by the city-state’s internet-only banking framework, can take minority stakes in the entities that will apply for the digital bank licenses. Foreign banks can take a minority stake in digital full bank applicants and any stake in digital wholesale bank entities.

What traditional banks are saying

Digital-only banks are set to gain ground on traditional lenders across Asia Pacific over the next few years, according to Forrester. In Singapore, about a fifth of the people Forrester surveyed said they would consider switching to digital-only banks within the next two years.

But local banks appeared to be optimistic about what the five new digital lending licenses entail for the industry.

“We welcome the diversity that the new players may bring with the digital bank licenses to be granted,” a spokesperson from UOB told CNBC.The inclusion of these additional players will tighten the competitive landscape.Gonzalo Luchettihead of consumer banking for APAC and EMEA at Citi

Meanwhile, OCBC Bank’s Head of Digital and Innovation Pranav Seth told CNBC the bank is open to forming new partnerships and ventures to serve new segments and markets. Media reports suggested that OCBC is in talks with companies, including Singtel, for one of the banking licenses.

DBS CEO Piyush Gupta said at its second-quarter results briefing in July that Singapore’s largest lender is relatively confident about tackling potential challenges posed by digital banks entering the market. “With the rise of digital, we have been focused on reimagining banking,” a DBS spokesperson told CNBC separately by email.

“Incumbents today continue to place emphasis on innovation to develop the type of capabilities that digital banks will be able to offer customers. The inclusion of these additional players will tighten the competitive landscape,” Gonzalo Luchetti, head of consumer banking for Asia Pacific and EMEA at U.S. lender Citi, told CNBC. Citi has an established presence in Singapore.

Competition would create the impetus for banks to do more with technology and provide better services, Luchetti explained. He added Citi’s ongoing investments in digital technologies and focus on strategic partnerships makes it well-placed to handle disruption in the banking services industry.

House Republicans might want to think twice before taking on the FBI director over Hillary’s emails.

FBI Director Comey halo
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Journalist Garrett M. Graff (@vermontgmg) is the author of The Threat Matrix: The FBI at War, and a former editor of Politico Magazine. His next book, Raven Rock, about the U.S. government’s Doomsday plans, will be published in May 2017. He can be reached at

FBI Director James Comey is about to discover whether Rep. Jason Chaffetz, the 49-year-old Republican chairman of the House Oversight Committee, can be scarier than a 25-year-old employee of the world’s largest hedge fund. Comey, who hasn’t spoken publicly since his political bombshell on Tuesday that the FBI wouldn’t recommend an indictment of Hillary Clinton, would probably argue no.

Comey is set to appear Thursday before the House committee to answer questions about the FBI’s yearlong investigation into Clinton’s private email system as secretary of state—a hearing that already appears to have the FBI director firmly in its cross hairs. Chaffetz has said that he found Comey’s decision “surprising and confusing,” and added in a statement, “Congress and the American people have a right to understand the depth and breadth of the FBI’s investigation.” 

Story Continued Below

Even after weeks of statements from Republican leaders and conservative media figures that they trusted Comey to conduct an impartial and independent investigation into Clinton’s emails and would respect whatever his decision ended up being, it took just hours after his 11 a.m. news conference before critical questions began flying. Former—and likely future—GOP presidential candidate Sen. Ted Cruz called Comey’s conclusion a “dubious decision.” House Speaker Paul Ryan (R-Wis.) said it “defies explanation” and instantly promised further hearings. Sen. Rand Paul (R-Ky.) declared it an “outrage,” saying, “The FBI should be better than this.”

Yet Chaffetz and his colleagues might get more than they bargain for in attempting to set up the FBI director for an oversight hearing bloodbath—just as last summer’s marathon hearing on Clinton’s role in Benghazi ended up backfiring on the select committee empaneled to investigate the 2012 Libya attacks, as the former secretary of state parried questions with confidence and ended up making Republican lawmakers look small by comparison. 

In attempting to set up the FBI director for an oversight bloodbath, House Republicans might get more than they bargained for.

Comey, as it turns out, is in his element when he’s under fire: He’s an experienced courtroom prosecutor and savvy Washington political in-fighter, and he burst onto the national stage in 2007 with some of the most riveting—and unexpected—congressional testimony in memory. But more than that, Comey comes armed Thursday with a secret weapon that he didn’t have even during that 2007 hearing, when he shocked the committee room by blowing the lid off a secret high-level showdown over the NSA’s domestic spying program that nearly caused mass resignations within George W. Bush’s Justice Department. 

After he left government, Comey spent three years being grilled, or “probed,” as an executive at Bridgewater Associates, the $150 billion hedge fund founded by Ray Dalio that the New Yorker has labeled“the world’s richest and strangest hedge fund.” Dalio, who regularly ranks among the 50 or 60 wealthiest people on the Forbes 400 list, has built the highly successful fund since the 1970s on a platform of “radical transparency,” a principle that encourages—actually forces—deep questioning from the ranks of all leadership decisions. 

It was just weeks after he joined Bridgewater—whose corporate culture of high-achieving intellectuals resembles a moneyed management cult that shares more in common with the 1970s personal-improvement fad est than it does with a typical Wall Street firm—that Comey was cornered by a similarly new 25-year-old employee. The junior associate interrogated the former Justice Department official on a seemingly illogical stance that Comey had taken in an earlier meeting. “My initial reaction was ‘What? You, kid, are asking me that question?’ … I was deputy attorney general of the United States; I was general counsel of a huge, huge company. No 25-year-old is going to ask me about my logic,” he recalled. “Then I realized ‘I’m at Bridgewater.’” 

Comey said that, even though he was excited to embrace the new way of thinking, it took him at least three months to settle in with Bridgewater’s culture. “I finally relaxed and untied the knot in my stomach that would instantly appear when someone questioned me,” he recalled. “Bridgewater’s a hard place. … It’s a place filled with really smart people who are always going to tell you the truth, and that’s hard.”

Inside Bridgewater, the culture of questioning is known as “probing,” a chance to understand the deeper “whys” inherent in an individual’s thinking or a corporate process. It’s a chance for everyone, from junior associates right up to Dalio himself, to force people past easy answers or glib statements into tight, rigorous thinking. “At Bridgewater, every day is a kind of after-action review, although the process goes much deeper than a typical postmortem,” business writers Robert Kegan and Lisa Laskow Lahey concluded in their book. Inside Bridgewater, where the “Culture of the Probe” reigns, meetings are even recorded, to force accountability for people’s statements and commitments.

According to Comey, who prosecuted targets ranging from Mafia boss John James Gambino to Martha Stewart to the bombers of the Khobar Towers, the decision-making environment for the firm’s 1,300 employees is tougher than anything he ever endured during decades rising through the ranks of the Justice Department, from a junior prosecutor to U.S. attorney for the Southern District of New York—the department’s highest-profile posting—to the No. 2 job under Attorney General John Ashcroft.

In a corporate video still on Bridgewater’s website, a cashmere sweater-clad Comey discusses the hedge fund’s emphasis on transparency and accountability: “I’ve been ‘probed’ in this strange field trip through life that I’ve had a lot of different places. I’ve testified in court, I have briefed the president of the United States repeatedly, I’ve argued in front of the United States Supreme Court, and I’ve been probed at Bridgewater. And Bridgewater is by far the hardest,” Comey says. “You combine that intelligence, the depth and the almost 360 [degree] vector of the questioning, there is no more demanding, probing, questioning environment in the world than Bridgewater.” 

“Sometimes I felt my head spinning when people were questioning me, but it’s uniquely demanding,” he said in the video. “If you say something stupid to the president of the United States, he may backhand you and say that’s a dumb answer, but he doesn’t want to know why you said that and what does that tell me about the way that you’re approaching your work, and what does it tell me about you. He’s never going to ask that.”

The deeply philosophical Comey, a religion major from William & Mary who wrote his college thesis on exegesis, the close study of texts, found himself comfortably at home inside Bridgewater once he got over the initial shock of transferring from the insular bureaucracy of the defense contractor Lockheed Martin, which he’d served as general counsel. “The mind control is working. I’ve come to believe that all the probing actually reduces inefficiencies over the long run, because it prevents bad decisions from being made,” Comey toldthe New Yorker in 2011 a year after he joined Bridgewater and two years before he was considered for the FBI director’s role. About Dalio, he added: “He’s tough and he’s demanding and sometimes he talks too much, but, God, is he a smart bastard.”

Comey explicitly carried many of the lessons from Bridgewater, where he made millions of dollars a year, into his new role as FBI director, which pays significantly less but is for him a dream position. “I went to Bridgewater in part because of that culture of transparency,” he told Iowa Senator Chuck Grassley during his confirmation hearing in 2013. “It’s something that’s long been part of me. I think it’s incumbent upon every leader to foster an atmosphere where people will speak truth to power. Bridgewater and the FBI are two different institutions, but I promise I will carry those values with me and try to spread them as far as I can within the institution.” Grassley, for his part, might not agree that Comey’s gone far enough in that direction: He was one of the skeptical GOP lawmakers who chimed Wednesday, calling the FBI’s decision on Clinton “suspect.”

Today, three years after assuming office as FBI director—and with seven more years left on his 10-year term—the straight-talking Comey has forcefully inserted himself into public controversies on government surveillance, picking a high-profile fight with Apple CEO Tim Cook, and demonstrated that he’s not afraid to break from the White House line on criminal justice issues.

And now, as he heads to the Hill on Thursday, it seems likely that he—perhaps more than anyone in Washington—is prepared to face the toughest questions about Clinton’s emails that the Republicans can muster. 

One common Washington joke about officials who mostly dread testifying on Capitol Hill is that they all immediately commit perjury by proclaiming that they’re “pleased to be here before the committee.”

James Comey may be the exception. In fact, he may welcome the chance to engage in verbal judo with inquisitors.

JP Morgan is backing the use of machine learning for the future of foreign exchange algorithmic trading, after applying the technology to its FX algos earlier this year.   

The investment bank launched Deep Neural Network for Algo Execution (DNA) as a tool to bolster its FX algorithms in April, using machine learning to bundle its existing algos into a single execution strategy.

“DNA is an optimisation feature that leverages simulated data from various types of market conditions to select the best order placement and execution style designed to minimise market impact,” said Chi Nzelu, head of macro eCommerce at JP Morgan. “It then uses reinforcement learning – a subset of machine learning – to assess the performance of individual order placement choices.”

JP Morgan added that in recent years, algo trading strategies such as time-weighted average price (TWAP) and volume-weighted average price (VWAP) have multiplied, forcing clients to choose from a suite of algos with various execution methods. As algo trading strategies continue to multiply, and following the launch of DNA, JP Morgan’s intention for the future is to develop a single algorithm to cover all algo trading strategies.

“While DNA is currently an enhancement for certain existing strategies, the future goal is to create one, all-encompassing algorithm that uses available data to provide users with information to improve execution under various market conditions,” JP Morgan said.

JP Morgan said that its decision to create DNA for its FX algos was inspired by technological developments in the equities trading space. The bank launched a proprietary equities trading execution service using machine learning technology in 2017, which also uses reinforcement learning techniques.

“To create the most scenarios and simulated environments possible, JP Morgan developers selected G7 currencies because they are the most heavily traded and therefore have the most data to teach the machine. While still in the initial stage, DNA has demonstrated its ability to push the performance of JP Morgan algos to an even higher level,” the bank said.