We’re delighted to reveal this year’s Hackathon winners: BNY in Challenge One and Secretarium in Challenge Two, who both came up with cutting-edge solutions capable of redefining the future of post-trade transactions.
Congratulations also go to our runners up, Capgemini in Challenge One and BNY in Challenge Two, who also proposed highly creative solutions to our challenges. And a big shout-out to the teams at Barclays and Sedicii too, who ran our winners very close.
The judges certainly faced a tough job selecting the winners this year out of the record-breaking 79 companies that entered.
Building the future of capital markets
This year’s theme was building the future of capital markets, a rapidly evolving space with unique challenges but also opportunities for innovation. This high-paced industry, typified by increasing transaction volume and complexity, demands fast, reliable and efficient post-trade processes.
The Hackathon 2024 teams were tasked with two challenges: For Challenge One, teams were required to develop solutions capable of enhancing the speed and accuracy of post-trade processes; while for Challenge Two, teams were asked to unearth creative solutions that ensure that data remains private in tokenised trades.
We spoke to both winning teams about their exciting solutions, and how they’re planning to seize opportunities in advancing securities markets.
Challenge One Winners: BNY
Objective: Enhance post-trade speed and accuracy
The manual steps involved in processing securities transactions can cause delays and errors, which undermine the global desire for shorter settlement cycles. Without automation that delivers speed and accuracy, companies may face settlement-failures and incur operational costs.
Winners in 2022, and runners-up in 2023, BNY is no stranger to the Swift Hackathon. “Considering our role in global financial markets, we’re always seeking innovative ways to improve market resilience and efficiency,” says Gaurav Gupta, Distinguished Engineer, leader in AI Hub, BNY.
A diverse team
BNY assembled a global team with a range of different skillsets, from product and operations to AI. “We started brainstorming sessions within the team, breaking down the steps in post-trade processing, highlighting areas of manual intervention, evaluating the impact of each problem and how the latest technologies like AI can help,” explains Pranit Kalantri, Product Manager in Treasury Services Platform, BNY.
“This multidisciplinary collaboration allowed us to create a comprehensive and well-rounded solution that addressed all aspects of the challenges,” adds Gupta.
This year’s challenge focused on improving the speed and accuracy of post-trade processes to ensure timely and zero-fail transactions. “This problem intrigued us because it aligns perfectly with our ongoing mission to enhance operational efficiency within the financial industry. The potential to leverage automation and AI, our teams’ areas of expertise, also resonated with us.
“As a key player in global financial market infrastructure, we see firsthand the challenges and opportunities in post-trade processing. We believe shorter securities settlement cycles will help improve the efficiency of global capital markets, reduce risk, and create new avenues for global trade,” explains Kalantri.
BNY’s winning solution identified a specific pain-point within the trade process where automation could make a significant improvement. “We discovered that the presence of 70E narrative in inbound MT 540-3 messages is the single biggest cause of Straight-Through Processing (STP) failures. To address this issue, we conceptualised an AI-powered decision reapplication engine designed to enhance the STP rate for post-trade custody settlement instructions, specifically targeting MT 540-3 Swift messages with field 70E,” explains Gupta.
“We moved through several stages of design and development, including data collection, model training, hyper-parameter tuning, user interface implementation and iterative testing. Close collaboration between our teams ensured that the solution was not only technically sound but also user-friendly and seamlessly integrated into existing workflows,” adds Kalantri.
The BNY team showcased a spirit of global collaboration, widespread enthusiasm and diversity of thought and expertise throughout the Hackathon process. “The opportunity to transform an idea into a proof of concept by training models in such a short amount of time was exhilarating,” says Gupta.
Winning the competition also means a lot for the team and BNY as a whole: “Success in the competition signifies a momentous achievement for our team, reinforces the global talent we have at BNY, and demonstrates our innovative prowess to solve challenging industry problems,” explains Gupta.
The winning team believes that capital markets are on the brink of transformation, with advanced technologies playing a central role. “Within a responsible and ethical framework, AI can increase efficiency, improve risk management and reduce costs. Excitingly, it can create new opportunities for global trade.”
Challenge Two Winners: Secretarium
Objective: Ensure data privacy in tokenised assets
Data privacy in digital asset trading can be challenging when multiple actors and systems are involved. Leveraging new technologies to ensure security, confidentiality and compliance in the post-trade processing of tokenised assets will be key for the future of capital markets.
Secretarium, a London-based company focused on privacy and trust, has been following Swift initiatives on digital assets for some time, particularly around the safe transfer of value from one digital asset to another.
“It was a great opportunity to showcase the capabilities of our technology, and we hope this will translate into a chance to explore further collaboration with Swift,” says Bertrand Foing, Founder and CEO, Secretarium.
With many accolades under their belt, such as winning the Global Central Bank Digital Currency Challenge run by the Monetary Authority of Singapore in 2021, entering the Hackathon was a natural step for the team.
“We are fortunate to have a talented and experienced team, which made the process very smooth. Having participated in similar challenges before, we knew how to approach it. We started with an initial discussion to brainstorm ideas, and settled on a concept. The entire prototype was built in five days.”
Reducing the trust boundary
Using encryption in post-trade processing can be difficult when multiple parties are involved, including traders, custodians and settlement agents. “Ensuring data privacy while allowing a transaction to be processed by all these entities is exactly the kind of problem our technology is built to solve. At Secretarium, we’ve always believed that privacy-focused systems should be able to interconnect just like internet systems do,” explains Foing.
Secretarium’s winning proposition was designed to augment Swift’s Transaction Manager with its honest-by-design and privacy-preserving technology, to create a unique common view of digital asset transactions. “We chose this idea because there was a wealth of content available, especially on the Swift website, including compelling articles on shared ledgers and UTIs.”
Confidence in the transaction relies on validating the data inputs and processes. “Our technology is about lowering the level of trust you need to have in people, systems and companies - as close to the hardware as possible - so that everything is audible, demonstrable and mathematically provable,” says Florian Guitton, Head of User Experiences, Secretarium.
The team valued the brevity, efficiency and prestige of the Hackathon. “The competition was an enjoyable experience that pushed us to build a prototype in just a few days, making it a rewarding challenge. We strongly believe in the collaboration between startups and large institutions,” explains Foing.
“It was also an incredibly nice team-building exercise,” adds Guitton bertrand-foing
The team finds the digitalisation of capital markets, and other industries, incredibly exciting. “We’re heavily involved in tokenised physical commodities, which is truly transforming market organisation. We believe many commodities have very similar issues with liquidity, price discovery and interest matching, and look forward to meeting oil, coffee and wheat traders to build similar solutions,” concludes Foing.