Euklid, an Italian startup in London’s Fintech landscape, is making up the new code of trading. The focus is on robots as guarantee of transparency and fairness.
It is the second time that Vision speaks about artificial intelligence (AI) but it will be better to get used to hear of it: the issue could not be hotter and its technological, economic and social parcatical aspects may be the new epoch-making challenges. To tell the story of AI applied to natural language recognition, Data Manager had to make a trip to Silicon Valley, but today we talk about automated trading, cryptocurrency, blockchain, hybrid banking services, shortly, “Fintech” and the principal city on a global ground can not be other ones than London, with one of its symbolic district, Canary Wharf where soaring skyscrapers and the most powerful banks of the world are the protagonists of a new finance governed by technology. And this is the case of Euklid. “Euklid is an all Italian idea, but here in London we found the right ecosystem ‘- says the co-founder and CEO, Antonio Simeone. “We can welcome new investors and rely on a financial system that works very well and without regulatory obstacles.” On the contrary, everything has been done to make easier the development of fintech startups. Let’s think about the regulatory sandbox- It is a temporary he temporary deregulation plan (with appropriate protective networks for consumers) that the Financial Conduct Authority developed to stimulate the growth of financial technology startups and the development of innovative products.
It is salso not the first time that Vision encounters the business paths of Simeon. Two years ago, he was one of the founders of Catchawork, an advanced social and professional network. The AI was an important ingredient in the recipe, but not the essential one. At a certain poin, it was necessary to figure out a new formula. – said Antonio Simeone. And here Euklid begins. Antonio Simeone, together with his current partner, Franco Grassi, started from the point where Catchawork had been left, applying artificial intelligence to another field and finding the winning recipe in the couple blockchain / algotrading driven by AI.
Bank of tomorrow
“Euklid was born officially in 2015, but it has been almost three years, as soon as you started talking about bitcoin, that his team is working on artificial intelligence able to predict the trend of cryptocurrency. In the past, Simeone used the same tools to analyze the performance of the stock indices. However, if applied to bitcoin, artificial intelligence could achieve even more effective outcomes, due to the high volatility of cryptocurrency. Today, the team of four co-founders – Antonio Simeone, Franco Grassi, Francesco Di Leva and Mario Giancola – can bear the precious consultancy of four advisors of international experience – the important economist, already Chairman of Unicredit Banca di Roma, Paolo Savona and the quantum physicist, Luca Marseglia, – both of them attended MIT-, Christopher Pallotta and Raffaele Mauro. With the second round of seed, Euklid will be be able to start a new developing phase, going towards what Antonio Simeone calls “Bank of tomorrow.” An entirely automated bank, at least for what concerns trading.
No longer it is the man to “point and click” orders after studying the trend, rather, the “psychology” of the markets (securities and currencies). Now the new activity of men focus on engineering process driven by AI and automated trading models, able to take decisions autonomously. Euklid plays without involving the men with their faults, greed and emotions, which are so often the principal cause of high and relevant losses in the stock market. “In Euklid, the man is a mere observer – Simeone confirms – and the investor is guaranteed by transparency. Each transaction of our traders is recorded in blockchain “. Simeone believes that blockchain represents for trading a revolution based on artificial intelligence, but also fairness, another quality that quite rarely we can find in the background of the current funds, more interested to earn profits thanks to the charges applied to each transaction. To the traditional “human funds” Euklid opposes a robotic model, without hidden costs. Investors in Euklid shall not pay any entry fee or charge. Only at the time of exit, the client shall attribute to the operator a percentage of 20% of the earnings. “The idea – said Simeon – is to become, passing the time, a reference point not for institutional investors, but for small investors.” Today, disappointed by a not reliable finance.
The Holy Grail of finance
At the moment, Euklid gives to the clients only the possibility to invest in cryptocurrencies. The robotic trader interfaces directly with Bitfinex and Kraken API, the two mile-stones for Bitcoin,Ethereum and other digital currencies. In the next stage, it will be also possible to invest money on a portfolio of about sixty titles selected among the most stable and linear ones in the market. At this stage, Euklid might rely on the collaboration of Bankable, one of the startups hosted by Level 39, the accelerator specialized in Fintech where it is established the office of the company of Antonio Simeone. Thanks to this hybrid payment, Euklid shall supply for basic banking services, from current accounts to credit transfers and even credit cards.
How does work the AI applied to the financial markets? “- There are 25 algorithms linked with every asset in the portfolio and they reflect the trading psychology of a title, and of a market. Each algorithm provides for 256 variables that the artificial intelligence engine process continuously studies through genetic algorithmic models and swarm intelligence. ” The genetic algorithm simulates the evolution of the human species, but instead of individuals there are scripts which are in competition with each other. “It’s like having at diposal millions of traders who are working on the time series of the trends on the stock market. The less effective script dies, the best lives on, trying to create more and more complex structures. The swarm, however, is a changeable and adaptive approach, modifying itslef moment by moment in an effort to correct its path when it has been made the wrong choise. The performance levels are very respectable. On crypto-currencies, Euklid has reached 110% of earnings. Indexes-securities gain is up to 10%, but going with “Lever 1”. With performances like that, we can say that Euklid owners can stop to work and leave it all to the robot? “Maybe” – jokes Simeone. “We never work less than ten hours a day. The markets continuously change and we can not stop studying new models to update our ‘bot.’ ” For now, at least. Antonio Simeone believes that the Holy Grail of finance algorithmic, investors robots that can build a new generation is now at our hands. It will take other ten or fifteen years of research.