Quantum technologies are moving from academic research to early deployment, raising concerns about data security and potential applications in finance, according to a report from the G7 Central Bank Quantum Technologies Working Group. The report highlights the possibility of quantum computers challenging current cryptographic techniques within the next decade, emphasizing the need for quantum-resilient security measures such as post-quantum cryptography.

US rates e-trading saw a 14% increase in average daily notional volumes in May compared to last year, reaching $1.26 billion, with dealer-to-client e-trading rising to 59% of volumes. Tradeweb and Bloomberg are competing for market share, with Tradeweb holding 22.6% and Bloomberg at 22.5%.

The rise of tokenized deposit initiatives has been accompanied by a fragmented landscape of platforms and operating models, making deposits issued by one institution difficult to use at another. The root of the problem is that transfers are still anchored in traditional account relationships, with know-your-customer checks performed by the issuing bank. The result is that tokenized commercial bank money is operationally constrained and unable to scale beyond isolated use cases.

Broadridge Financial Solutions has joined Project Glasswing, an initiative by Anthropic to use artificial intelligence to bolster cybersecurity for critical infrastructure. Broadridge CEO Tim Gokey says the company will apply frontier AI models to its systems to stay ahead of emerging threats.

Tradeweb has introduced Tara, an AI-powered chatbot to assist US credit market participants in gaining insights from trading data. Initially available to select firms, Tara will be rolled out to US institutional credit clients in July and to global clients later this year.

The Securities and Exchange Commission is preparing to issue guidelines that would allow cryptocurrency companies to offer blockchain-based stocks, a move that could significantly impact US equity markets. The SEC's "innovation exemption," expected soon, would enable trading of tokenized versions of existing stocks without full compliance to SEC rules. Coinbase has announced plans to launch tokenized stocks in the US when permitted.

The Commodity Futures Trading Commission has issued a request for information to identify regulatory obstacles that hinder fintech firms from partnering with federally regulated institutions. The initiative aims to streamline application processes and update regulations to enhance innovation and competition in the derivatives markets.

The use of tokenized deposits, particularly for cross-border payments and treasury management, could strengthen corporate banking relationships, according to a report from the Euro Banking Association. The report notes that while banks might lose correspondent banking and foreign exchange revenue, they could make up for it with new business models focused on programmable payments and custody services.