The Cloud is increasingly the primary choice of deployment for post-trade workloads and trading, a new Nasdaq paper has found, with market readiness one of the factors driving the adoption.
Specifically, regulatory uniformity in terms of wider views is a key aspect highlighted by the report, as well as the establishment of resiliency models.
Read more: Aquis Stock Exchange first to adopt cloud-based matching engine
As more and more workloads across the value chain migrate, a more solid foundation for operational efficiency is expected, explained Nasdaq, which in turn “will widen the applicability of cloud deployment for more and more FMIs”.
The paper also highlights how execution quality can be improved through streamlined pathways by adopting third party expertise – such as Cloud providers, as well as its relevance in reducing friction for participant across the value chain.
In addition is the potential for a reduction in the costs associated with accessing markets and revenue generation for participants, as well as opening new revenue streams for FMIs.
“We believe the FMI space is on the cusp of a phase in which strategic partnerships, mandated change and strategy coalesce to catalyse accelerating modernisation,” said Nasdaq.
In addition, in discussing Cloud adoption more widely across financial markets, Nasdaq highlights the massive impact of AI as a key driver, as the market continually recognises the relevance of technological upgrades and ensuring one does not fall behind by holding on too tightly to legacy systems and structures.
The paper highlighted Gartner findings, which predict that Cloud will be a business necessity in five years, forecasting end user spenditure on Cloud to reach almost $680 billion in 2024, subsequently exceeding $1 trillion in 2027.
Read more: Deutsche Börse enters 10-year partnership with Google Cloud to accelerate innovation
The report asserts that attention must be paid to technology infrastructure itself in the pursuit of cutting-edge tools, ensuring support and foundational blocks are present.
“The future is coming quick for FMIs, and the economy at-large, as AI/ML promises to catalyse new innovation. This presents several opportunities, such as improved analytics, increased efficiencies and the potential for new revenue streams, but it also presents a challenge for FMIs in how they approach infrastructure in a way to support new technologies and, more importantly, evolving ecosystem,” said Nasdaq.