Introduction
Artificial Intelligence (AI) is revolutionizing global finance—and Italy is catching the wave. From retail traders to major banks, AI trading is reshaping decision-making, risk assessment, and strategic positioning. In this in‑depth article, we explore how Italy is unlocking AI trading’s potential, its regulatory landscape, pioneering institutions, real‑world use cases, and what lies ahead.
A Growing Market for AI in Italian Finance
Market Size and Growth Trends
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In 2024, Italy’s AI industry reached €1.2 billion, a 58% year‑on‑year increase.
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Specialized forecasts estimate the “Applied AI in Finance” market in Italy grew from approximately $290 million in 2023 to $354 million in 2024, and may exceed $1 billion by 2035, implying a compound annual growth rate of about 10.5% Market Research Future.
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The banking sector leads AI adoption with over €173 million in investment, followed by telecom/media, and then finance, insurance, public administration, and healthcare.
These numbers reflect significant confidence in AI as a tool for automation, efficiency, and competitive advantage.
AI Adoption Among Firms
A survey by Politecnico di Milano revealed that only 11% of large Italian organizations are fully mature in AI adoption, while SMEs remain largely early‑stage. This gap underscores a dual challenge: scaling innovation among smaller firms and spreading best practices widely.
Real‑World Use Cases in AI Trading
UniCredit’s DealSync Platform
UniCredit, one of Italy’s leading banks, has implemented DealSync, an AI‑based digital platform used to identify and match M&A opportunities, particularly among SMEs. Since its launch, DealSync has generated around 2,000 leads and secured 500 mandates, capturing a potential €50–60 billion of smaller M&A deals in Italy and Germany.
This system enables the bank to scale advisory services without hiring extra bankers and plays a crucial role in its €1.4 billion revenue growth target for client solutions by 2027.
Banca Investis and NIWA
In July 2024, Banca Investis launched NIWA—the “Next Intelligent Wealth Advisor”—an AI‑powered virtual assistant embedded in its mobile app. NIWA offers AI‑driven financial guidance 24/7, integrating chat-based support with a human banker, and reinforcing digital private banking for tech‑savvy Italian clients aged 35+.
Retail Traders and Platforms
Italian retail traders are increasingly adopting AI solutions like AlgosOne, which claims high success rates and profitability comparable to institutional platforms. Users report automated chart analysis, round‑the‑clock trading, and dramatic returns relative to manual methods Forbes Cryptonomist.
Institutional Support and Strategic Projects
Banca d’Italia–OECD Project
Under the European Commission’s Technical Support Instrument, Banca d’Italia, together with Consob, COVIP, IVASS and the OECD, launched a comprehensive project on AI in Italian financial markets. The initiative aims to analyse both opportunities and risks, conduct industry surveys, host workshops, and issue supervisory guidance. A final report is expected by spring 2026.
National AI Strategy and AI4I
Italy’s National AI Strategy 2024–2026, finalised in July 2024, aligns with the EU AI Act and frames a roadmap for responsible innovation through government, industry, and research coordination.Launched in Turin, the Italian Institute of Artificial Intelligence for Industry (AI4I) serves as a bridge between academia and industry, supporting R&D, high-performance computing, and start‑ups in sectors including finance.
InvestAI & EU Funding
Italy benefits from the EU-level InvestAI initiative, part of a €200 billion mobilization plan—including €20 billion for AI “gigafactories”—to bring high-performance computing to member states. Italy and AI4I are positioned to leverage these investments to support domestic models and fintech start‑ups.
Moreover, Milan-based firm iGenius is seeking €650 million in funding to develop its Italian-trained open-source LLM “Italia” for regulated sectors like finance and public services.
The Regulatory and Ethical Landscape
EU AI Act & Italy’s National Bill
While Italy lacks AI-specific laws, it follows EU-wide regulations, notably the emerging EU AI Act. In March 2025, Italy’s Senate approved a delegate bill to implement national AI regulations, though full consensus and legal text remain pending White & Case LLP.
Meanwhile, Italian courts and the data protection authority have already endorsed principles of transparency, human oversight, and algorithmic non‑discrimination in automated decision-making Wikipedia.
RegTech & Financial Regulation
Italy’s Fintech Sandbox, established in 2019, allows pilot projects across emerging fields like robo‑advice, algorithmic credit scoring, and DLT‑based solutions under controlled conditions GLI.
Robo‑advice powered by AI is regulated as a financial advisory service under MiFID II and requires licensed providers. Concerns over algorithmic biases and suitability compliance remain high GLI.
RegTech tools are also being deployed to streamline compliance and manage risks associated with AI adoption in finance.
Governance for AI Trading
Although MiFID II does not classify algorithmic trading as “high‑risk”, scholars argue that AI-based trading may warrant stricter governance. The EU AI Act’s “high‑risk” requirements—such as comprehensive documentation and human oversight—may eventually evolve to cover AI‑powered algorithmic trading more extensively.
The European Central Bank has also flagged potential risks like provider concentration, herding behaviour, cyber threats, and systemic vulnerabilities—from AI use in finance—suggesting the need for close oversight and possibly new rules Reuters.
Penalties for Abuse
Italy’s draft national AI bill proposes enhanced penalties—including up to three years’ imprisonment—for using AI in harmful practices like market manipulation, deepfakes, or money laundering. A €1 billion national AI investment fund is also under consideration.
Challenges and Opportunities Ahead
Data Accessibility and Quality
AI trading systems require high‑quality, real‑time data feeds. Access remains uneven, especially for SMEs and retail platforms, which may lack institutional-grade data infrastructure.
Human‑AI Synergy
Effective AI in trading often emerges when AI augments human judgment rather than replaces it. Platforms like DealSync and NIWA exemplify this hybrid model. Going forward, firms need to invest in training and user education to maximize adoption and trust.
Institutional and SME Divide
While large institutions lead in AI innovation, many SMEs remain at early stages. Bridging this gap through shared infrastructure, training, and public-private partnerships will be crucial.
Regulatory Uncertainty
With national AI legislation still in process, clarity around “high-risk” classification, cross-border data flows, and algorithmic auditability remains limited. Interim guidance from Banca d’Italia and EU principles are helping—but more specificity is needed.
Risk Management and Ethics
AI trading introduces risks—model error, bias, cyber threats, concentration of power among providers. Risk-based governance frameworks, as promoted by academic and regulatory commentators, will be essential to balance innovation with market stability Side Islear Review of AI Law.
Italy’s Strategic Roadmap to AI Trading Leadership
Strategic Pillars for the Future
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Regulatory Frameworks: Finalize the AI Bill aligned with the EU AI Act; define how AI trading counts as “high-risk” and set human oversight, auditability, and documentation standards.
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Public-Private Collaboration: Expand engagement via OECD/Banca d’Italia initiatives, workshops, sandbox programmes, and industry consultations.
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Infrastructure & Talent Investment: Scale access to high-performance computing via EU’s InvestAI; support R&D at AI4I and firms like iGenius.
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Adoption Support for SMEs: Offer shared platforms, training, open data access, and digital financing options to drive broader AI uptake in smaller firms.
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Ethical Standards & Risk Governance: Promote transparency in algorithms, guard against bias, enforce accountability, and mandate fallback oversight mechanisms.
Vision for 2027–2028
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Italy becomes a European frontrunner in AI-enabled investment platforms, robo-advisory, and quant trading systems.
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Major banks like UniCredit expand AI‑based advisory to broader sectors.
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Retail investors aged 35+ increasingly embrace platforms like NIWA and local AI tools.
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A healthy ecosystem of SMEs, fintechs, AI4I‑backed start‑ups, and institutional firms thrives under stable, predictable regulation.
Conclusion
Italy is at a pivotal moment in its AI trading journey. With strong institutional support, growing market momentum, and emerging innovation hubs like AI4I and iGenius, the country is unlocking significant opportunities. At the same time, challenges remain: regulatory clarity, SME support, ethical safeguards, and human-AI integration.
If handled wisely, AI trading could transform how Italians invest, banks advise, and markets operate—ushering in a new era of smarter, more inclusive and resilient finance. Italy’s future in AI trading may well define Europe’s broader path toward digital finance excellence.
