Emerging Technology Research Hub

Synthetic Data Expert Group

In 2023, we launched an expert working group[3] bringing together 21 experts[4] across financial services, public sector, data and technology vendors, and consumer groups. The Group aims to provide practical experience using synthetic data and will publish a report early 2024 analysing how its application can advance data sharing across a range of financial use cases such as fraud detection, credit scoring and anti-money laundering (AML).

If you’d like to get involved with our synthetic data work, email us at [email protected].

OECD & FCA Research Article 

In May 2023 we published a research article exploring the fundamentals of synthetic data in addressing data sharing issues in UK financial markets at the OECD AI Observatory. The article provides an overview of the FCAs work in this space to data and overlaps with AI. Read the research article[5].

Industry-Academic Roundtable

In March 2023, we held a joint event in partnership with the Alan Turing Institute, the ICO and industry and academic stakeholders to understand the challenges of validating synthetic data and bring together industry participants. The resulting paper[6] explores the validation of synthetic data from privacy, utility, and fidelity perspectives.

Feedback Statement on Synthetic Data

In February 2023, our feedback statement[7] (FS) summarised responses to the synthetic data Call for Input[8]. The FS highlighted the significant potential synthetic data has to advance innovation in financial services, informing our future work programme. The paper sets out the responses across the following key areas:

• data access
• risks
• benefits
• generation techniques
• use cases and the role of the regulator

UK-US PETs Prize Challenge

Throughout 2022, we took part in UK and US cross-governmental efforts to accelerate the development of Privacy Enhancing Technology[9] (PET) to combat financial crime issues. We played an observer role during the challenge and gathered valuable insights on how innovators were deploying novel solutions to tackle common challenges. 

Global AML and Financial Crime TechSprint 

In 2019, we held a week-long TechSprint to identify how PETs can help detect and prevent financial crime and global anti-money laundering. This TechSprint helped spur future developments of PETs in financial services and subsequent initiatives by the Financial Action Task Force[10] (FATF) and other international organisations.  

Informing Global Regulatory Approaches to Quantum Security

In collaboration with the World Economic Forum, we convened financial regulators and central banks from across the globe, industry leaders, and academic experts to publish a white paper[11] on the quantum threat to public-key cryptography and key considerations for transitioning to quantum-secure systems. This paper provides four guiding principles along with a roadmap that serve as a blueprint for both industry and regulatory authorities to reduce complexity and align their activities throughout the transition.

DRCF Quantum Insights Paper

Following the Quantum Symposium, the Digital Regulation Cooperation Forum (DRCF) published the comprehensive Quantum Technologies Insights Paper[12]. This paper explores the potential of quantum technologies, from their capabilities to the challenges they present and arising potential regulatory implications. It builds on rich discussions from the symposium, providing  an overview of prospective regulatory questions that may arise as these technologies evolve.

DRCF Quantum Symposium

As part of the DRCF[1]’s horizon scanning programme[13], member regulators held a symposium in March 2023 on Quantum Information Technologies to understand their potential impact across shared regulatory remits. We will be publishing a blog summarising the key insights and themes of the day.

Quantum Leap for Financial Services 

In July 2021, we published an article[14] exploring the potential of quantum technologies to revolutionise the operation of financial services firms and markets. The article dives into potential opportunities and challenges these technologies could pose to policymakers. This research has been highlighted as an example case study for creating awareness in the regulatory environment by the World Economic Forum[15].

Understanding Quantum Technologies

Since 2020, we have actively monitored and researched industry adoption of quantum computing through collaboration with the National Quantum Computing Centre[16] and the Quantum Computing & Simulation Hub[17] to understand the potential implications for financial services.

Research Note: Review of Maximal Extractable Value and blockchain oracles

Through horizon scanning activities, we identified various elements at the technical level of blockchain technology that are altering the way in which cryptoasset services and Decentralised Finance (DeFi) are provided. This research[18] analyses two novel concepts of blockchain technology, Maximal Extractable Value (MEV) and blockchain oracles to inform regulatory understanding and expertise.

DRCF Insight Paper on Web3

As part of the DRCF horizon scanning programme[2], in March 2023, member regulators published a Web3 Insights Paper outlining key perspectives across academia, industry, government and regulators. The paper presents an overview of the possible harms and benefits associated with distributed ledger technologies underpinning the  Web3 “vision” and explores the regulatory considerations across the DRCF member regulator remits.

DRCF Web3 Symposium Blog

In October 2022, the DRCF held a symposium to understand the evolution of the Web3 landscape and unpack the regulatory opportunities and challenges. The event was held in partnership with the UCL Centre for Blockchain Technologies[19], with contributions from the Imperial College London Centre for Financial Technology[20] and Digital Catapult[21]. The event provided novel insights into Web3 and provided the foundations for future research.

DRCF Digital Identity

In September 2023, the Horizon Scan and Emerging Technologies team in the DRCF initiated a work programme[22] to explore how digital identity might evolve across multiple technological areas in the medium term. This work aims to capture potential joint regulatory implications across all DRCF members’ remits.

DRCF Immersive Technologies Foresight Paper

In December 2023, the Horizon Scanning and Emerging Technologies team in the DRCF published a foresight paper[23] analysing the future of immersive technologies, including key drivers of change and the associated benefits and risks. The paper assesses the regulatory implications that might arise as a result of these futures.

DRCF Metaverse Symposium

In May 2022, the DRCF brought together key stakeholders across industry, analysts, academics, government and regulation to explore perspectives and potential implications associated with the metaverse and immersive technologies. The event held in partnership with Digital Catapult[24], captured key challenges for people, businesses and the wider economy. 

Read about the key themes in the blog[25].