Financial Firms Embrace GenAI, Target Tokenization
Generative AI is already delivering measurable business results, prompting financial services firms to accelerate technology transformation and focus on the tokenization of market infrastructure, a Broadridge study found. The report indicates the industry is entering a period of accelerating change, with firms doubling down on technology investment as early AI projects prove their value.
- Practical applications of Generative AI in finance include enhanced fraud detection, where it can identify anomalies and suspicious patterns in real-time, and more dynamic credit and risk scoring by analyzing diverse data sources beyond traditional financial statements. Some firms are also using AI to generate synthetic data to train fraud prevention models, allowing them to stay ahead of evolving threats. - The global asset tokenization market was valued at $5.60 billion in 2024 and is projected to grow to $30.21 billion by 2034. A recent survey found that 63% of custodians are already offering tokenized assets, with an additional 30% planning to do so within two years, driven by benefits like improved efficiency and security. - In the U.S. real-time payments landscape, The Clearing House's RTP network processed a daily average of 1.18 million payments in Q2 2025, with a total quarterly value of $481 billion. The newer FedNow service saw its volume grow 460% in 2025, processing over 8.4 million payments for the year with a total value of $853.4 billion. - Digital identity is becoming critical for secure payments, utilizing technologies like biometrics (fingerprint, facial recognition) and blockchain to reduce fraud and streamline customer onboarding (KYC) and authentication processes. This is crucial as financial services and Web3 converge, with regulators viewing digital ID as a backbone for anti-money laundering (AML) in the crypto space. - Venture capital investment in AI-driven fintech companies grew from $12.1 billion to $16.8 billion year-over-year in 2025. However, AI-enabled fintechs accounted for only 30% of total VC investment, with blockchain and stablecoins also seeing significant interest as a near-term disruptor for payment rails. - While financial firms are rapidly adopting AI, regulatory frameworks are still evolving. Regulators in the UK and other jurisdictions are using "sandboxes" to test AI innovations in supervised environments, focusing on a risk-based approach to governance that aligns with principles of fairness, transparency, and security. - Stablecoins are gaining institutional traction for cross-border payments, with one report estimating they could handle $2.1 to $4.2 trillion of cross-border transactions by 2030. Their adoption is driven by the potential for instant settlement, lower transaction fees, and 24/7 operation, bypassing many frictions of traditional correspondent banking.
