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Integrating Blockchain and AI in Financial Systems: A Case Study on Cross-Border Payments and High-Frequency Trading Synergies

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  • Han, Li

Abstract

This paper investigates the synergistic integration of blockchain and artificial intelligence (AI) in financial systems, with emphasis on security, transparency, and operational efficiency. The study analyzes blockchain’s decentralized ledger mechanism and AI’s anomaly detection algorithms in enhancing fraud prevention and regulatory compliance. It explores the application of these technologies in cross-border payments and high-frequency trading (HFT), demonstrating their impact on settlement time reduction, transaction cost minimization, and market execution precision. Case studies include the role of Ripple and Stellar in decentralized remittance systems and AI optimization in algorithmic trading strategies. The paper also addresses limitations such as regulatory divergence, technological interoperability, model risk, and cybersecurity vulnerabilities, highlighting implementation challenges in financial infrastructures.

Suggested Citation

  • Han, Li, 2025. "Integrating Blockchain and AI in Financial Systems: A Case Study on Cross-Border Payments and High-Frequency Trading Synergies," OSF Preprints 2mn3f_v1, Center for Open Science.
    • Handle: RePEc:osf:osfxxx:2mn3f_v1
    DOI: 10.31219/osf.io/2mn3f_v1
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    1. P. V. Thayyib & Rajesh Mamilla & Mohsin Khan & Humaira Fatima & Mohd Asim & Imran Anwar & M. K. Shamsudheen & Mohd Asif Khan, 2023. "State-of-the-Art of Artificial Intelligence and Big Data Analytics Reviews in Five Different Domains: A Bibliometric Summary," Sustainability, MDPI, vol. 15(5), pages 1-38, February.
    2. Paolo Vanini & Sebastiano Rossi & Ermin Zvizdic & Thomas Domenig, 2023. "Online payment fraud: from anomaly detection to risk management," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 9(1), pages 1-25, December.
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