Cyber Risks Biggest Vulnerability for FX: New GFXC Chair

Cyber resilience is the most underappreciated vulnerability facing the foreign exchange market, according to the incoming chair of the Global Foreign Exchange Committee, as advances in artificial intelligence create new risks for market infrastructure.

Bernard Wee, who will succeed Gerardo García as chair of the GFXC, says market participants need to pay closer attention to the operational risks posed by increasingly sophisticated technology. “One of the underappreciated vulnerabilities is resilience,” Wee says in an interview with The Full FX. “If you think about the advances in artificial intelligence and the risks that artificial intelligence can bring to identify new vulnerabilities in systems, FX is very reliant on computer systems and trading in microseconds.

“If IT systems are vulnerable to cyber attacks, that really brings down the reliability of the FX market and confidence in the market,” he adds.

The comments come as the GFXC prepares for its latest major review of the FX Global Code in 2027, coinciding with the code’s 10th anniversary. Wee says one of his priorities as chair will be launching a survey of market participants to assess how the Code has performed since its introduction and identify areas where it should evolve.

“The code comes of age next year. It’s our 10th anniversary, so it’s a good time to get feedback from both existing and new members on what impact the committee has had on the foreign exchange market,” he observes.

While cyber risks represent the biggest concern, Wee also sees artificial intelligence as one of the largest opportunities for the industry. He says AI could help market participants process greater volumes of activity, improve efficiency and expand access to FX services. “The biggest opportunity is to adopt artificial intelligence to increase the ability of the FX market to trade larger volumes and serve more customers,” he says. “Foreign exchange supports payments, credit and lots of other processes. Technology can really improve the market.”

The GFXC recently established a Technology and Innovation Working Group to examine how emerging technologies could affect the market, including developments in trading, governance, data and settlement infrastructure. The working group forms part of a broader effort by the committee to identify emerging risks and opportunities ahead of the next code review. “We should also pay attention to the Technology and Innovation Working Group to identify emerging risks and opportunities for the foreign exchange market,” Wee stresses.