FSB Warns of Big Tech’s AI Dominance in Financial Systems

The Financial Stability Board (FSB) has intensified its cautionary stance on the financial sector's growing reliance on a handful of technology giants for artificial intelligence integration. Concentration risks are particularly acute in generative AI (GenAI), where adoption rates remain elevated across banking and investment firms.

Hardware supply chains—especially AI chip production—emerge as the most vulnerable node. Cloud computing infrastructure for AI applications also shows alarming centralization among a few providers. 'Operational disruptions could cascade through Core financial services if dependencies aren't diversified,' the FSB noted in its latest systemic risk assessment.

Market analysts observe parallels with crypto's early infrastructure bottlenecks, where exchange centralization created similar single points of failure. The report underscores how technological dependencies could amplify systemic risks in both traditional and decentralized finance.