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With new regulations such as General Data Protection Regulation (GDPR) and Markets in Financial Instruments Directive (MiFID) II coming into effect, organizations around the world are beginning to see whether their hard work preparing for compliance will hold up to regulatory requirements. While the first day of trading under MiFID II rules may seem like the end of a long road of preparations, it's actually just the beginning of the story.

With many firms still working on achieving full compliance, 2018 will be a critical year for seeing how MiFID II will play out in the real world. In addition, co-occurring regulations including GDPR are making compliance a big concern in 2018. However, new technologies, including artificial intelligence and blockchain and their impact on security and productivity, will be prime concerns (and opportunities) in 2018 as well.

Below are five top factors that will most strongly affect the real-world operations of companies across all industries, and on both sides of the pond—both those that that are still working on a complete compliance strategy and those that are already feeling confident in their readiness.

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Factor #1: Cyberattacks

In 2018, Cyberattacks will be at an all-time high. Companies must ensure that they are using the latest security technologies to protect themselves from new external and internal threats as users move sensitive content over channels like SMS, mobile voice, messaging apps, and other novel collaboration tools like Microsoft Teams, WeChat and WhatsApp. Attackers are looking at new ways to breach corporations, and these emerging (and often poorly controlled) technologies are on the top of their hit list.

While these communication tools represent fantastic progress in digital transformation, they also raise questions about how well IT and security departments can match the robust security and compliance standards we're used to having for traditional tools like email. In fact, email protection technology has gotten so good—protecting firms from internal and external threats with data loss prevention solutions—that the door is largely closed to attackers, who are now targeting newer real-time communications and collaboration tools instead. Through regulations such as GDPR, organizations can be found liable for fines if they don't implement the appropriate safeguards to protect against these attacks.

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Factor #2: Reliable Immutable Data

MiFID II and GDPR are top of mind in 2018, and trusted immutable data and open access to data repositories will play a central role in maintaining compliance. Companies will be expected to be ready and able to demonstrate that they are compliant. In financial services, for example, firms must be able to reconstruct trade events with electronic communications within the 72-hour regulatory SLA window, a requirement that will be tested at scale in 2018. In addition, Article 15 of GDPR requires organizations to prove they can effectively search and retrieve personal data to provide timely responses to citizen inquiries.

To meet global regulations, regulated entities are realizing that a combination of data science and technology solutions are key in helping them identify areas of risk. Companies should avail themselves of best-of-breed systems that have open access to datasets for sophisticated, post- and near real-time data analysis, allowing them to automate the threading and reconstruction of conversations with minimal manual labor.

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Factor #3: Expanding Data Volumes

Although “exploding” data volumes have been discussed for years, the trend will continue into new orders of magnitude of data size. Being well-prepared for 2017's data volumes won't be enough for 2018 and beyond. Firms will need to constantly leverage new tools internally and externally to stay ahead of expanding data volumes and protect their employees from getting bogged down by them. Possibly more importantly though, they should understand that huge volumes of mysterious data are also a legal liability.

Advanced analytics and data management capabilities that can handle these huge datasets also offer a great opportunity to drive innovative insights for line of business applications. For this to happen, firms need to have access to unfettered, Open APIs and fast access to reliable, trusted datasets. Efficient advanced analytics is no longer a nice-to-have but mandatory for many regulated industries looking to deliver a competitive customer experience and marketing programs that go beyond traditional compliance surveillance.

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Factor #4: Artificial Intelligence

AI was a common technology story in 2017, with the technologies themselves dominating the narrative. In 2018, we expect to see the conversation evolve to how AI will be applied to help corporations attack increasing workloads inherent in regulatory supervision and surveillance and how the technology will support more frequent security reviews by decoding sentiment, detecting stress, tone, and personal information (per GDPR rules).

With the right technology partnerships, corporations can deliver on the speed and agility promised by AI, as well as provide efficient compliance review and e-discovery results that may have once required an army of offshore people to process.

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Factor #5: Blockchain

In 2018, blockchain-based ledgers are expected to become increasingly accepted into the mainstream. While blockchain technology may still be viewed by some as disruptive, its potential to increase trust and transparency in financial transactions and communications across groups is gradually becoming better understood.

The Monetary Authority of Singapore and the Australian Securities Exchange are both exploring blockchain's application for the clearing and settlement of financial events, while the Hong Kong Monetary Authority is developing a blockchain-based platform for trade finance. In these and other projects, we are seeing the move from disruption to adoption across the industry. However, as often seen with fast developing technologies, it's difficult to gauge whether current laws will be enough once blockchain becomes more widespread.

In summary, 2018 will be marked by the maturing of new technologies along with the arrival of unprecedented regulations. The challenges are real: Reprieves for MiFID II will end, and failure to make the most of new technology presents a real risk of becoming uncompetitive this year—most firms won't be able to do it alone.

Anthony West is Chief Technology Officer for Actiance. Mr. West is regarded as an enterprise collaboration technology strategist, specializing in real-time communications platforms and B2B/B2C architectures that are critical to financial services and other regulated industries. Prior to Actiance, Mr. West oversaw communications compliance infrastructure services at Credit Suisse, where he acquired a thorough understanding of what it takes for regulated firms to deploy modern communication channels in a compliant manner to prevent costly fines and violations.