AI, digital assets, and blockchain bring new risks but also opportunities for leading financial service organizations to more rapidly move from ideation to implementation to transformation
Disruptive innovation is sweeping through the financial services industry at pace. At the heart of the change are rapidly advancing technologies like AI, blockchain, and digital assets.
These innovations are creating exciting new opportunities — and, at the same time, introducing new risks and changing others, both of which financial services organizations must navigate.
This rapid rate of change can create challenges for these organizations who want to understand and adopt new technologies in time to lock in a competitive advantage. And with speed and constant change, there’s also the risk of overlooking governance, controls, and regulatory frameworks needed to harness these innovations responsibly.
Understanding the opportunities
Deloitte’s Financial Services Industry Predictions 2025 report illustrates how these technologies are being applied across financial services sectors. Here are some of the most noteworthy financial services technology trends and use cases, as well as the governance, regulatory, and control considerations foundational to bringing these applications to life.
Banking and Capital Markets
Tokenized currency networks built on blockchain are transforming cross-border payments, with stablecoins and tokenized commercial bank deposits set to become the main digital cash instruments. By 2030, Deloitte projects one in four large-value international transfers will settle on these platforms, cutting transaction costs by 12.5% and saving businesses more than $50 billion in fees. Banks should assess the operational impact of shifting transaction flows to blockchain exchanges and develop value-added services, backed by a strong governance framework, to maintain and multiply corporate relationships.
Commercial Real Estate
Tokenization uses blockchain to divide a property such as an office building into fractional shares, represented as digital tokens that can be securely traded online. Key applications include tokenized private real estate funds, loan and securitization ownership, and undeveloped or under-construction projects. Using tokens in these ways can create unprecedented liquidity and democratize commercial real estate investment, potentially transforming the sector. Deloitte estimates that tokenized real estate will reach $4 trillion by 2034, up from less than $0.3 trillion in 2024. It will be important for real estate firms to assess the complex legal, regulatory, and technical challenges of moving to tokenized real estate.
Insurance
Within insurance,property and casualty (P&C) insurers are using AI to launch fee-based risk management services built on a “predict and prevent” model. These offerings, including data-sharing and white-label partnerships, can help drive growth and protect customers amid rising climate risks. U.S. P&C insurers’ fee-based revenue is expected to rise from $21.6 billion in 2023 to $49.5 billion by 2030. Insurers should consider developing more advanced predict-and-prevent services and strengthen their AI risk management and governance.
AI-powered multimodal technologies are set to enhance fraud detection in the P&C insurance sector. By using AI to integrate real-time analysis, insurers could reduce fraudulent claims and save between $80 billion and $160 billion by 2032. AI can analyze text, images, audio, video, and sensor data to identify patterns and anomalies, improving the investigative process. To minimize AI risk, insurers should combine AI with human oversight to effectively detect and prevent fraud.
Investment Management
The shift from mutual funds to active exchange-traded funds (ETFs) is accelerating. Active ETFs offer transparency, flexibility, tax efficiency, and lower costs, combining active management with ETF benefits. AI-driven platforms deliver adviser-led investment advantages without traditional adviser fees. U.S. active ETF assets are forecasted to grow from $856 billion in 2024 to $11 trillion by 2035, according to Deloitte, a 13-fold increase fueled by demand for lower expenses and stronger performance data. Expanding active ETF offerings and building robust authorized participant networks and governance frameworks can help investment managers capture this growth.
Other Considerations
Whether implementing stablecoins for cross-border payments, tokenizing commercial real estate, or leveraging AI for wealth and risk management, navigating operational, compliance, and risk challenges can be complex. Below are some key governance, risk, and control considerations for leaders:
Governance, risk, and controls. Implementing AI and blockchain tools for financial services requires a robust governance framework with effective controls to help maintain data accuracy and mitigate security and accountability risks. Human oversight throughout is the key to transparency and trustworthiness.
Operational and technical support. Management of digital assets such as tokens requires specialized support in technical accounting, valuation, reconciliation, tracking, financial reporting, and more.
Legal and compliance. These considerations for digital assets like stablecoins and tokens include navigating smart contracts, specialized financial reporting, and regulatory requirements such as know your customer/anti-money laundering. AI also introduces specific audit documentation and testing requirements.
— by Kevin Richards, partner and US Audit & Assurance leader, Deloitte & Touche LLP
