C-3PO and the 21st Century Economy

Part of my job as CEO is to be the chief evangelist of Nasdaq. Any engagement I participate in, I am asked to introduce myself and the company. This time, when I sat down with CTA CEO Gary Shapiro at CES for CTA’s Great Minds series, I asked ChatGPT to do it for me. Their answer was both pretty funny and pretty good.

We asked the app: “If Nasdaq was a Star Wars character, who would it be?” Here’s the answer:

Personally, I wouldn’t characterize C-3PO as adaptable, given that they fret over every new adventure, but then again, they do speak every language in the universe. Nasdaq, on the other hand, has been quite adaptable over our 50 years, and it is quite reaffirming to see ChatGPT give us credit in that area. In fact, we have adapted so much that ChatGPT’s description does not encapsulate the full extent of Nasdaq’s business and impact on the financial industry today. ChatGPT certainly gives us credit for one part of our business – our ‘highly advanced and sophisticated’ exchange – but falls short in providing details of our broader business which includes solutions for modernizing markets, providing seamless routes to capital, and fighting financial crime – just to name a few. It redeemed itself, however, by remarking on our adaptability, which has been a cornerstone of our culture over my tenure.

Though the jury is still out about exactly how advancements in AI, like ChatGPT, will affect our lives and industries, it felt like an appropriate way to start a conversation about the impact that technology will have on the economy in 2023. While many of the CEOs I talk to are planning more conservatively for the year ahead, few are taking their foot off the gas when it comes to investing in technology. Regardless of the uncertainty, I still expect investment in innovation as companies across sectors are preparing their organizations to thrive in an economy that will be more automated, where disruption is the norm, and one where cooperation between humans and technology will be even more seamless.

For me the takeaways from our discussion are this:

AI is here – and it will impact everything:

• The momentum around AI is palpable across almost every industry. Just in my short time at CES, I learned about how many companies and industries are using AI to evolve their businesses from digital healthcare to space exploration, to electric vehicles and beyond.
• I share the industry’s bullishness on the potential of AI and we are already evolving its use here at Nasdaq. It is a critical component to the work we do in fighting financial crime, and we have our first market-based product application rolling out this year.
• As it relates to markets more broadly, we see major opportunities to apply AI to make markets even more accessible to more participants. AI has the potential to democratize access not just to data, but to intelligence and actionable insights that will enable more informed, effective investing. It will also be a core driver of trust - helping protect markets and market participants by identifying market manipulation and bad actors.

The need for both innovation and regulation to keep pace:

• Times of economic uncertainty tend to spur even greater innovation, driven both by immediate need and long-term opportunity. The question becomes: how can we embrace innovation while also maintaining and enhancing trust? Answering this question is a shared responsibility for all of us who work with and in financial markets.
• Conversations at CES correctly focused on the evolving face of responsible innovation, and the deepening relationship between technology, innovation, and regulation.
• The tension inherent in empowering progress and maintaining our ability to protect against nefarious use cases is a constant balancing act. It is the responsibility of industry as well as the regulators and policy makers to continuously collaborate to ensure we are enabling the right type of innovation and progress, while maximizing our ability to root out crime.

The year ahead gives us an important opportunity to focus on the fundamentals— to invest in quality, to find a middle ground on regulation, and, most importantly, to build an even stronger foundation of trust in U.S. financial markets. The winners will have to be open to uncertainty and adventure – unlike C-3PO -- and lean into both the power of technology and its implications.