I. Introduction: The Geoeconomics of Digital Velocity — Updated for November 2025
The global financial system stands at a decisive inflection point. The technological convergence of advanced Artificial Intelligence (AI) capabilities and next-generation satellite communication (SatCom) infrastructure—specifically Low Earth Orbit (LEO) constellations—is fundamentally restructuring both the microstructure of financial markets and the architecture of financial access itself. This transformation operates along two distinct but intertwined vectors: the pursuit of ultra-low latency for competitive advantage in trading and market operations, and the deployment of AI-driven analytics to extend sophisticated financial services to previously unreachable populations. As these vectors converge, systemic risk is being redefined—moving away from traditional balance-sheet exposures toward vulnerabilities anchored in critical, geopolitically sensitive, and increasingly non-terrestrial infrastructure.
The LEO Market Acceleration: Evidence from 2025
The evidence supporting this convergence is now empirical, granular, and commercially validated. Global end-user spending on LEO satellite communication services is projected to reach $14.8 billion in 2026, representing a 24.5 percent increase from 2025. The global LEO satellite market is expected to grow from approximately $6.4 billion in 2026 to nearly $29.77 billion by 2035, expanding at a compound annual growth rate of 17.7 percent between 2025 and 2035. North America continues to dominate market share, driven by sustained investment in satellite infrastructure, national security imperatives, and the rapid deployment of commercial megaconstellations such as Starlink and Project Kuiper.
These developments are not speculative. The European Parliament’s approval of €2.6 billion in financing for the IRIS² constellation underscored Europe’s intention to secure strategic autonomy in space-based communications. In June 2025, Orange expanded its partnership with Eutelsat Group under a multi-year agreement leveraging Eutelsat’s OneWeb constellation to enhance enterprise and government services across Europe, Africa, and the Middle East.
Operationally, LEO satellites—operating a few hundred kilometers above Earth—are now demonstrating superior performance in latency, positioning accuracy, and reliability of coverage in remote or infrastructurally thin environments. LEO-based positioning, navigation, and timing (PNT) assets offer proximity advantages over traditional systems by a factor of twenty-five, strengthening their utility in both critical communications and financial-market synchronization.
II. AI Adoption in Banking: The 2025 Inflection Point
The adoption of Artificial Intelligence in banking has reached a critical threshold. As of 2024, three in four large companies were using generative AI, though some report it has yet to improve their bottom line, with smaller companies showing adoption rates in the high single digits. More strikingly, 78 percent of banks are now adopting generative AI tactically, up from only 8 percent in 2024, representing an extraordinary acceleration within a single year.
The financial returns are beginning to materialize. JPMorgan Chase CEO Jamie Dimon stated in an interview with Bloomberg TV in November 2025 that the bank is already breaking even on its approximately $2 billion of annual investments in AI adoption, describing it as "just the tip of the iceberg." Notably, DBS, Southeast Asia's largest bank, expects AI adoption to bring it an overall revenue increase of more than 1 billion Singapore dollars (approximately $768 million) in 2025, compared to SG$750 million in 2024, based on about 370 AI use cases powered by over 1,500 models throughout its business.
The velocity of this transformation is historically unprecedented. The Federal Reserve’s latest assessment notes that the speed at which AI technology is moving makes it appropriate for central banks to proactively engage in using AI for their own operations, signaling recognition among policymakers that the pace of AI deployment has outstripped historical precedents and institutional capacity.
A. Ultra-Low Latency and the Deterministic Sky
Financial markets remain profoundly sensitive to temporal advantage. Enhanced positioning accuracy and timing synchronization from LEO systems are expected to deliver greater efficiency across IT, finance, and telecom sectors, with more effective synchronization, diversified data processing, and maintenance of 5G standards.
The operational risk introduced by this latency reduction is real and measurable. LEO satellites, known for their low latency and high-speed communication, have proven critical in providing worldwide broadband internet coverage, particularly in underdeveloped and remote locations, with the market entering a rapid expansion phase with over 20 active LEO satellite service providers and more than 40,000 satellites expected in the coming years. As the density of satellites increases and handover frequencies accelerate, operational complexity for financial infrastructure dependent on deterministic connectivity will intensify proportionally, creating novel cascading failure modes.
B. Generative AI in Banking Operations: The Proven Business Case
The deployment of AI in banking is no longer experimental. While many banking C-suite leaders are increasingly questioning value realization in light of headwinds, a few leading banks, including DBS, have systematically deployed AI across the enterprise and begun capturing material gains. DBS’s decade-long preparation in data analytics facilitated the transition to generative and agentic AI, where agentic AI autonomously plans and executes tasks with minimal human oversight.
The transition from predictive analytics to autonomous decision-making introduces systemic implications that merit urgent regulatory attention. Central banks recognize that algorithmic collusion represents a risk, as AI trained on similar datasets may unintentionally produce coordinated recommendations or pricing strategies, mimicking collusion and undermining competition. Traditional regulatory frameworks struggle to address these challenges.
C. Alternative Credit Scoring and Financial Inclusion: Infrastructure as a Prerequisite
The connection between satellite infrastructure and financial inclusion is operationally critical. In regions where 1.3 billion adults remain unbanked, blockchain and mobile wallets enable expanded access to capital. In the APAC region, the neobanking market is projected to grow from $16 billion in 2022 to $526 billion by 2030. Psychometric testing in lending, such as at Juhudi Kilimo in Kenya, has increased credit acceptance rates by 5 percent and improved repayment predictions compared to using financial data alone.
Crucially, the efficacy of alternative credit scoring systems depends entirely on continuous, low-latency connectivity for real-time data collection and model inference. Without the connectivity layer provided by LEO constellations, scaling AI-driven financial inclusion in remote and underserved regions remains practically infeasible.
III. Regional Trajectories and Regulatory Divergence: Updated Status (2025–2036)
A. Advanced Economies: Innovation versus Governance
United States: Commercial Momentum and Regulatory Fragmentation
The United States maintains technological dominance, but governance gaps persist. The Federal Reserve has explored AI in operations for some time, using it to improve staff efficiency. However, comprehensive federal legislative frameworks remain absent. In January 2025, the Trump administration moved to deregulate AI with Executive Order 14179, revoking Biden-era AI guardrails. This shift creates both competitive advantages and systemic vulnerabilities.
European Union: Standards Leadership and Competitive Friction
The EU Digital Operational Resilience Act (DORA), effective January 17, 2025, focuses on the operational resilience of the financial sector, addressing risks posed by ICT and AI. This comprehensive approach is likely to position the EU as a global standard-setter for AI governance in finance, though potentially at the cost of slower competitive dynamism relative to less-regulated jurisdictions.
Asia-Pacific: Differentiated Approaches
The Reserve Bank of India introduced the FREE-AI framework (Framework for Responsible and Ethical Enablement of AI), guiding safe adoption in the financial sector, with expected efficiency gains of up to 46 percent. The Monetary Authority of Singapore advanced Project MindForge, developing a reference architecture and risk framework for GenAI in finance, alongside governance handbooks for sustainability and cybersecurity.
B. Central Banking and AI Governance: The Institutional Response
Central banks face a defined governance challenge: balancing speed, accuracy, and oversight in AI deployment. Comprehensive risk management frameworks, including the three lines of defense model, remain essential. Emerging-market central banks face additional constraints of volatility, regulatory gaps, and limited resources. Effective oversight requires staff with both economic expertise and technical AI skills, mitigating risks such as hallucinations, biases, and prompt injection attacks.
IV. Geopolitical Bifurcation and BRICS: Financial Sovereignty Through Infrastructure
A. BRICS Pay: From Aspiration to Operational Reality
BRICS Pay, primarily initiated by China and Russia, is a planned independent and decentralized payment messaging system to facilitate trade among BRICS countries in local currencies, bypassing the US dollar. As of mid-2025, the system remains in planning and pilot phases, with operational deployment expected by late 2025 or 2026. Integration efforts are ongoing, with secure links between Russia’s SPFS and other countries partially implemented, and standardized messaging protocols and cybersecurity frameworks still in development.
Negotiations for a non-dollar settlement system have advanced, with finance ministers and central bank governors exploring interoperability among member countries’ payment systems.
B. The Infrastructure Prerequisite for Financial Sovereignty
BRICS financial sovereignty depends on sovereign control of infrastructure. Western sanctions cutting Russian banks off from SWIFT have accelerated BRICS Pay’s development. Russian Finance Minister Anton Siluanov emphasized that cross-border payment systems using national currencies, underpinned by digital technologies and digital financial assets, are central to economic development. China’s state-led LEO constellation (Guo Wang) is increasingly recognized as a strategic financial infrastructure asset critical to BRICS’s financial sovereignty objectives.
V. Macro-Financial Implications and Governance Responses
A. Velocity and Monetary Policy Transmission
The acceleration of price discovery, driven by LEO low-latency connections and AI trading algorithms, compresses central banks’ policy reaction windows. While AI enables real-time analysis, rapid decision-making must be tempered by mitigation of risks such as hallucinations, biases, and vulnerabilities.
B. Systemic Risk from Concentration and Third-Party Dependencies
AI is being exploited by cybercriminals to produce sophisticated phishing, malware, and impersonation attacks. Risks such as prompt injection and data poisoning can compromise model integrity. Institutional capacity constraints exacerbate vulnerabilities, particularly in emerging economies where central banks face technical and resource limitations.
C. The Governance Deficit: Real-Time Monitoring as Critical Priority
The speed of AI deployment continues to outpace regulatory oversight capacity. While benefits are evident, regulators identify key risks, including complex data sources and ensuring firms have robust governance and documentation to maintain data quality and provenance.
VI. Global Governance Institutions: Evolving Mandates
The BIS has intensified its role as a governance coordinator, providing guidance for AI implementation in central banks and developing risk management frameworks. Its committees facilitate cooperation and the exchange of best practices to maintain monetary and financial stability amid the digital transformation.
The IMF’s 2025 survey of 191 central banks highlights the widening preparedness gap. AI has potential to increase global GDP by 7 percent by 2030, yet uneven adoption, especially in low-income countries, risks widening disparities. Central banks must adapt monetary and macroprudential frameworks to account for uneven AI-driven productivity.
VII. Conclusion and Reframed Policy Recommendations
The convergence of AI and SatCom represents not merely a technological disruption but a structural reorganization of global finance around non-terrestrial infrastructure assets. The financial system of 2036 will be characterized by hyper-efficient algorithmic trading clusters dependent on deterministic LEO connectivity, operating in parallel with expanded, AI-customized financial services reaching previously unbanked populations, all underwritten by dual-use satellite assets whose operational integrity depends on geopolitical stability in space.
Strategic Imperatives for Financial Authorities
Mandate Real-Time Infrastructure Monitoring – Supervisory bodies must shift from quarterly surveys and voluntary disclosure to continuous telemetry from LEO operators and critical network nodes. Traditional supervisory tools are inadequate for detecting infrastructure-driven market instability in real time.
Establish Dual-Use Infrastructure Standards – Satellite connectivity should be treated as critical financial infrastructure, with minimum cybersecurity, operational continuity, and cross-border cooperation standards. BIS and IMF collaboration with space regulatory bodies is required.
Address Algorithmic Bias in Financial Inclusion – Governance guidelines must prevent systemic algorithmic discrimination and protect vulnerable populations from predatory risks amplified by AI.
Pursue Digital Sovereignty While Maintaining Interoperability – BRICS and other blocs must secure independent infrastructure while establishing common technical and regulatory standards to avoid fragmentation of global liquidity.
Final Prognosis for 2036
The next decade will witness definitive technological bifurcation: U.S. commercial dominance in AI and LEO infrastructure, EU regulatory leadership, and China’s state-led sovereign integration. The global financial order will be profoundly efficient, tightly interconnected at the algorithmic level, and critically dependent on a concentrated set of space-based assets. Financial stability will hinge on effective governance of these non-terrestrial assets, confirming that the future of global finance is inextricably linked to control of the digital sky.
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