Nasdaq's Anti-Financial Crime Business Grows 20% Year-On-Year With AI Innovations

In a bid to strengthen its campaign against financial crime, Nasdaq Inc. NDAQ has been investing heavily in artificial intelligence technology, according to the CEO Adena Friedman.

What Happened: Nasdaq has been channeling substantial investments into technology aimed at combating financial crime. This has led to the company’s anti-financial crime unit becoming its fastest-growing business. This news was announced by CEO Adena Friedman during the Consumer Technology Association conference in Las Vegas, reported Bloomberg.  

According to Friedman, the company’s anti-financial crime business has seen roughly 20% year-on-year growth. "We are investing in the technology in a very significant way."

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Nasdaq’s anti-crime solutions leverage artificial intelligence to predict and expedite the identification and elimination of criminal behavior. The company has joined forces with banks, other exchanges, and brokerage firms to deploy this software and neutralize threats.

Since taking over as CEO in 2017, Friedman has navigated Nasdaq beyond its exchange origins, steering it towards more predictable revenue streams. One significant move in this direction was the $10.5 billion acquisition of software provider Adenza, which has helped transform Nasdaq into a comprehensive financial-services company.

Friedman also discussed the approval of spot Bitcoin ETFs by the Securities and Exchange Commission, with Nasdaq being one of the exchanges that filed to list the product. "It opens the door for more accessibility for that particular asset class."

Why It Matters: This announcement by Nasdaq comes at a time when AI technology is making considerable headway in the financial sector. For instance, the technology has revolutionized traditional investment strategies offering unprecedented insights and precision.

However, AI technology is not without its risks. Last year, U.S. regulators flagged AI as a potential risk to the nation's financial system, highlighting the need for increased supervision and monitoring.

Furthermore, AI technology’s role in the financial advisory sector has been a topic of debate. In December 2023, Ben Henry-Moreland from Kitces.com noted that the fiduciary responsibilities of advisors could pose a challenge to the full adoption of AI in the sector.

Photo Courtesy: Shutterstock.com

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This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.