e-Forex January 2024

transforming global foreign exchange markets 

e-FOREX 

e-forex.net JANUARY 2024 

LOOK AHEAD 

Key e-FX developments we can 

expect in 2024 

T+1 SETTLEMENT 

What are the implications for FX? 

REGIONAL 

PERSPECTIVE 

Exploring the state of e-FX in 

Southern Africa 

NDFs 

The market looks towards 

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DATA 

Putting it at the heart of FICC 

business strategy 

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2 JANUARY 2024 e-FOREX

Welcome to 

e-FOREX 

transforming global foreign exchange markets 

January 2024 

We start this edition by reporting on the considerable progress that 

is being made regarding adherence to the FX Global Code. During its 

two-day virtual meeting held on 30th November - 1st December last 

year, the GFXC reported that during 2023, the GFXC Global Index of 

Public Registers reached 1,290 Statements of Commitment, an annual 

increase of 8% which represents significant progress in the uptake of 

the Code. It will be interesting to see the results of the 2023 FX Global 

Code Survey which are due to be released soon. 

Susan Rennie 

Susan.rennie@sjbmedia.net 

Managing Editor 

Charles Jago 

charles.jago@e-forex.net 

Editor (FX & Derivatives) 

Charles Harris 

Charles.harris@sjbmedia.net 

Advertising Manager 

Michael Best 

Michael.best@sjbmedia.net 

Subscriptions Manager 

David Fielder 

David.fielder@sjbmedia.net 

Digital Events 

Ingrid Weel 

mail@ingridweel.com 

Photography 

We next go on to explore the impact on FX markets of the imminent 

move to T+1 Securities Settlement. The reduction of the settlement 

cycle is likely to lead to additional complexities to post-trade processes 

and FX market participants are being encouraged to carefully analyse 

their operational and liquidity management practices to avoid 

disrupting market functioning. 

Our regular Look Ahead feature in this months January edition 

focuses attention on some of the key developments in e-FX we are 

likely to see this year and our Regional Perspective report looks at the 

continued expansion of electronic FX trading in Southern Africa and 

the prospects for its growth across both East and West Africa over the 

next few years. 

The advantages of putting data at the heart of FICC business strategy is 

what we are talking about in our data management article. This sounds 

relatively easy but it isn’t. Trading firms may have systems in place to 

capture data, but to use it in a consistent and repetitive process at the 

performance levels they need is a complex and expensive undertaking. 

Relying on specialist providers to overcome the challenges and take 

some of the pain away is one way of tackling the issues so we talk to a 

few to discover what solutions they have on offer. 

Finally our Special Report in this edition looks at why demand for NDFs 

continue to surge and the role of electronic trading and associated 

technology to help meet this. The future prospects for NDFs look good 

for a variety of reasons including the growth of various emerging 

market economies. As asset managers continue to increase their asset 

allocation in these respective markets, usage of NDFs as a hedging tool 

will increase. In response, the electronic trading capabilities of NDFs, 

including the usage of NDF algos, will continue to evolve as well. 

Ben Ezra 

Ben.ezra@sjbmedia.net 

Retail FX Consultant 

Tim Hendy 

tim@thstudio.co.uk 

Web Manager 

SJB Media International Ltd 

Suite 153, 3 Edgar Buildings, George Street, 

Bath, BA1 2FJ United Kingdom 

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Design and Origination: 

Matt Sanwell, DesignUNLTD 

www.designunltd.co.uk 

Printed by Headland Printers 

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Although every effort has been made to ensure the accuracy of the information 

contained in this publication the publishers can accept no liabilities for 

inaccuracies that may appear. The views expressed in this publication are not 

necessarily those of the publisher. 

Please note, the publishers do not endorse or recommend any specific website 

featured in this magazine. Readers are advised to check carefully that any 

website offering a specific FX trading product and service complies with all 

required regulatory conditions and obligations. 

The entire contents of e-Forex are protected by copyright and all rights are 

reserved. 

As usual I hope you enjoy reading this edition of the magazine. 

Charles Jago, Editor 

JANUARY 2024 e-FOREX 3

January 2024 

CONTENTS 

REGULATORY 

ISSUES 

14. FX measures the impact 

of the latest FX Global Code 

review and imminent move 

towards T+1 settlement 

Vivek Shankar investigates in what 

ways the FX Global Code’s influence 

is set to increase further and what 

are the implications for FX as U.S. 

securities move to T+1 settlement. 

We asked Chris Gibson, Director 

of Payments at smartTrade 

Technologies, to tell us more 

about his firm’s new classleading 

FX and payments 

platform. 

E-FOREX INTERVIEW 

38. With Andreas Wigström, 

Managing Director, LMAX 

Global 

CONTENTS 

Nicholas Pratt 

Look Ahead 

Matt Kassel 

Product Launch 

Marc Bayle de Jessé 

Growth of CLSNet 

Vivek Shankar 

Regulatory Developments 

Andreas Wigström 

e-Forex Interview 

Chris Gibson 

CBP Platform 

MARKET 

COMMENTARY 

22. A Look Ahead at what we 

can expect with e-FX in 2024 

Nicholas Pratt explores some of the 

key developments in electronic FX 

that are likely to take place this year. 

PROVIDER 

VIEWPOINT 

26. The growth of CLSNet: 

The next best thing after 

CLSSettlement 

By Marc Bayle de Jessé, CEO of 

CLS. 

REGIONAL E-FX 

PERSPECTIVE 

28. Exploring the state of 

e-FX and associated fintech in 

Southern Africa 

Vivek Shankar discovers that 

electronification in FX is increasing 

not just in South Africa but across 

the whole continent. 

PRODUCT REVIEW 

36. CBP: A versatile and 

powerful platform to deliver FX 

and payments solutions 

SPECIAL REPORT 

46. NDFs: The market 

looks towards increasing 

electronification to meet rising 

demand 

As the demand for NDFs continue 

to surge, Nicholas Pratt examines 

the role of electronic trading and 

technology to meet this. 

EXPERT OPINION 

58. The value of performance 

analysis and network 

monitoring solutions to the 

trading world 

Beeks Group outlines how a costly 

IPO sparked the genesis of Market 

Data Capture and Replay solution 

mdPlay. 

DATA MANAGEMENT 

60. Putting data at the heart of 

FICC business strategy 

Vivek Shankar finds out more 

about the challenges that FX 

trading firms are facing when 

managing and exploiting their data 

and the technology solutions that 

are now becoming available to 

address these. 

COMPANIES IN THIS ISSUE 

A 

Alp Financial 

B 

Beeks 

Bloomberg 

C 

Centroid Solutions 

Citi 

CLS 

p52 

p58 

p49 

p65 

IFC 

p17 

E 

Edgewater Markets 

Euronext 

F 

Factset 

FairXchange 

Finalto 

Flextrade 

FXSpotStream 

p12 

p57 

p21 

p6 

p55 

p8 

p9 

L 

LMAX Global 

Loop FX 

LSEG 

M 

Mosaic Smart Data 

O 

oneZero 

p38 

p8 

p16 

p61 

p63 

R 

Rand Merchant Bank 

Refinitiv 

S 

Saxo Bank 

smartTrade Technologies 

Swissquote Bank 

T 

360T 

Tradefeedr 

p33 

p31 

p5 

p19 

p7 

p30 

p61 

D 

DMALINK 

p10 

I 

IPC 

OBC 

P 

PLUGIT 

IBC 

W 

WBR 

p53 


FX prime 

brokerage 

Customised FX & precious metal 

liquidity and clearing solutions 

With Saxo’s technology-driven prime brokerage services partners access 

top tier bank and non-bank liquidity providers and venues. 

Our FX prime brokerage combines co-located connectivity in all three major 

liquidity centres, credit intermediation, ultra-low latency pre-trade credit risk 

controls, bespoke pricing and execution analytics. 

Saxo caters to clients of all sizes, from those who are too small to access 

the services of major investment bank prime brokers, to large clients who 

choose Saxo due to the quality of our service and offerings. 

Our partners benefit from the trust and security of a regulated and licensed 

Danish bank with a global footprint, authorised in multiple jurisdictions. 

31% 13.1% 272% 

Total capital ratio ICAAP requirement Liquidity coverage ratio 

SIFI 

Designated Systemically 

Important Financial Institution 

by Danish FSA 

BBB 

S&P Global Ratings 

Learn more at www.institutional.saxo 

Contact: solutions-uk@saxomarkets.com 

+44 207 151 2100 

This material is produced for marketing purposes only. Trading in financial instruments carries 

some degree of risk, always ensure you fully understand all the risks before trading. 

Read Saxo’s full disclaimer at www.home.saxo/legal/disclaimer/saxo-disclaimer. 


Wells Fargo joins FXSpotStream 

FXSpotStream LLC has announced that exciting to see this level of interest 

Wells Fargo has joined FXSpotStream in becoming a liquidity provider 

and is now live with multiple 

on the Service. FXSpotStream has 

clients, becoming the 16th bank become a name synonymous with 

connected to FXSpotStream’s price 

streaming service, joining Bank of 

America, Barclays, BNP Paribas, Citi, 

Commerzbank, Goldman Sachs, HSBC, 

J.P.Morgan, Morgan Stanley, MUFG, 

NatWest, Standard Chartered, State 

Street, Societe Generale and UBS. 

FXSpotStream CTO, Tom San Pietro 

commented: “It is tremendously 

Tom San Pietro 

growth, client service, performance 

and reliability. We feel that these 

qualities are what have made us such 

an appealing prospect for LPs. We are 

extremely excited to be working with 

Wells Fargo and adding another highquality 

liquidity provider that had 

been requested by our client base. In 

Q4 of last year, we added our first LP 

since 2020 and having a second now 

live is confirmation that the plans that 

we created with the goal of adding 

additional LPs have been effective and 

are delivering the desired results.” 

Saxo Bank partners with FairXchange 

NEWS 

Saxo Bank has become the latest 

institution to join the rapidly growing 

FairXchange ecosystem. Under the 

terms of the arrangement FairXchange 

are providing their award-winning 

liquidity management platform Horizon. 

Guy Hopkins, CEO and Founder of 

FairXchange said “We are delighted 

to welcome Saxo to the FairXchange 

network. They were one of the very 

first institutions to embrace datadriven 

dialogue with their Liquidity 

Providers, and they have always had a 

deep understanding of the importance 

of working with their LPs to source the 

best possible liquidity. We are delighted 

to help them continue in that spirit of 

Guy Hopkins 

collaboration, working with them to 

help them maximise opportunities for 

them, their LPs and their clients.” 

James Dewdney-Herbert at Saxo 

commented “The relationship with 

FairXchange is already off to a very 

strong start. Since we went live with 

FairXchange we have already noted a 

material uplift in engagement from our 

trusted liquidity partners, leading to 

greater profitability both for them and 

for us, ultimately resulting in better 

liquidity for our clients.” 

Finalto Asia partners with PrimeXM 

Finalto Asia and PrimeXM have 

with PrimeXM, leveraging our XCore 

announced a strategic partnership technology at the Equinix SG1 data 

which aims to reshape the FX and CFD center, marks a significant milestone 

landscape in Asia and firmly establish for our growth in the APAC region. This 

exciting new liquidity solutions in 

initiative underscores our commitment 

the region through collaboration. 

to delivering sophisticated and efficient 

By combining the financial service 

experience of Finalto Asia and the cuttingedge 

technology expertise of PrimeXM, 

a leading technology provider for the 

finance industry, the two are better 

prepared than ever to establish robust 

and sophisticated liquidity frameworks. 

Clive Diethelm, PrimeXM Founder 

Alex Mackinnon 

stated: “Finalto Asia’s collaboration 

trading technology solutions, enhancing 

our service offering in Singapore’s 

dynamic financial market.” Meanwhile 

Alex MacKinnon, Regional CEO of Finalto 

Asia, also expressed enthusiasm about the 

partnership, stating: “This collaboration 

with PrimeXM is a strategic milestone 

for Finalto Asia. By combining our 

strengths, we aim to deliver unparalleled 

liquidity solutions and advanced trading 

technologies to the financial community 

in Singapore and the region.” By working 

together, Finalto Asia and PrimeXM will 

be able to seamlessly aggregate liquidity 

from various source 


Institutional 

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LIQUIDITY SOLUTIONS 

Combine power and tailor-made for best-in-class execution on FX Spot, Metals, 

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Partner with the Swiss leader in online banking (SIX:SQN). 

swissquote.com/fx-prime 


FlexTrade and LSEG collaborate 

FlexTrade Systems has announced a 

partnership to deliver FlexTRADER EMS 

clients seamless access to FXall, LSEG’s 

leading electronic trading platform 

for global currency products. The 

partnership will enable new mutual 

clients access to FXall execution services 

from within the FlexFX EMS. Through 

the delivery of the highly customizable 

FlexFX front end, clients trading FX will 

be able to access FXall’s extensive global 

liquidity network, including support 

for spots, forwards, swaps, NDFs, and 

options, which can be executed on 

FXall’s regulated environments such as 

MTF and SEF. Further, FXall’s liquidity can 

be combined with FlexTrade’s liquidity 

and automation capabilities, including 

FlexAlgoWheel, to streamline lowtouch 

FX orders.Jill Sigelbaum, Head of 

Strategic Development & Partnerships, 

FX, at LSEG, noted: “We are delighted 

to join forces with FlexTrade to provide 

clients with an enhanced multi-asset 

offering. Our priority at LSEG is to 

understand our clients’ FX needs and 

meet them where they want to trade. 

By combining FlexTrade’s customizable 

interface with FXall’s world-class, 

regulated liquidity pools, the offering 

provides the strongest end-to-end 

solution in the market today.” 

Jill Sigelbaum 

Central Bank of Kenya launches Bloomberg’s Bmatch solution 

NEWS 

The Central Bank of Kenya has 

announced the launch of Bloomberg’s 

BMatch solution for interbank 

trading in the local foreign exchange 

market. BMatch offers spot matching 

functionality to the interbank 

community for US Dollar against 

the Kenyan Shilling. BMatch allows 

anonymous orders to be placed into 

a central limit order book, which are 

displayed and then matched with 

counterparty orders based on mutual 

trading limits and other parameters 

configured by each bank. The solution 

can be integrated with banks’ middle 

and back-office systems. Consolidated 

trade statistics can also be calculated 

Tod Van Name 

and made available to the market. 

“We are delighted to support the 

Central Bank of Kenya with our BMatch 

solution, which will help increase 

transparency, liquidity and efficiency 

on the local foreign exchange market. 

Bloomberg has extensive experience in 

providing robust technical infrastructure 

solutions for foreign exchange markets 

and can easily adapt these to the 

specific needs of any market around the 

world,” said Tod Van Name, Bloomberg’s 

Global Head of FX Electronic Trading. 

LoopFX to be integrated into FactSet’s Portware 

trading platform 

LoopFX and FactSet have announced 

plans to integrate LoopFX into FactSet’s 

FX execution management system, 

Portware, in early 2024. Renowned 

for its market-leading data, analytics, 

and innovative technology solutions, 

FactSet will embed LoopFX’s groundbreaking 

‘Peer-To-Bank’ matching engine 

technology into Portware, providing 

FactSet’s clients easy access within 

their existing workflows directly on 

their trading screen. FactSet’s Portware 

Platform is an advanced multi-asset 

Execution Management System (EMS) 

used by leading buy-side traders 

worldwide. Portware enables traders 

to analyze, communicate, and execute 

orders with diverse market participants 

and liquidity destinations through 

highly efficient, customized, and 

automated workflows. “We are pleased 

to announce the integration of LoopFX 

into FactSet’s Portware Platform,” said 

Chris Matsko, Head of Foreign Exchange 

Trading Services at FactSet. “This 

announcement showcases FactSet’s 

dedication to enhancing our products 

by working with innovative solutions 

that provide the best possible outcomes 

to our valued clients.” Blair Hawthorne, 

Founder and CEO of LoopFX, says, “We 

are delighted to partner with another 

global award-winning FX industryleading 

platform. Portware is a trusted 

hub for some of the world’s largest asset 

managers whose clients now have direct 

access to LoopFX functionality within 

their preferred workflows.” 

Chris Matsko 


Evolving with the Market 

Added Functionality to Support Algos & Allocations Now Live 

® 

GUI 

Live 

RFS 

Functionality 

Added 

London 

& Tokyo 

Offices Open 

FX|Insights 

Analytics Tool 

Launched 

USD11T 

Supported 

for 2020 

FX Spot 

Streaming 

Only 

FX Fwds, 

Swaps Added 

Streaming 

Precious 

Metals Added 

NDF/NDS, 

PM Swaps 

Added 

Total Reaches 

15 LPs 

Algos & 

Allocations 

Functionality 

Added 

® 

FXSpotStream is a bank owned consortium operating as a market utility, providing the infrastructure 

that facilitates a multibank API and GUI to route trades from clients to LPs. FXSpotStream provides a 

multibank FX streaming Service supporting trading in FX Spot, Forwards, Swaps, NDF/NDS and 

Precious Metals Spot and Swaps. Clients access a GUI or single API from co-location sites in New York, 

London and Tokyo and can communicate with all LPs connected to the FSS Service. Clients can also 

access the entire Algo Suite of the FSS LPs, and assign pre- and/or post-trade allocations to their 

orders. FXSpotStream does not charge brokerage fees to its clients or LPs for its streaming offering. 

Algo fees from an LP are solely determined by the LP. 


Commerzbank goes live 

with DMALINK 

We ask Michael Siwek, Founder/CRO of DMALINK to tell us more about 

this important partnership with Commerzbank, who will now stream prices 

electronically onto the firms platform. 

NEWS STORY 

Commerzbank being an organisation 

that is not afraid to take the lead 

and press forward with the evolving 

global financial market. Recent 

press announcements made by 

Commerzbank signify a huge shift 

in the direction of the digital asset 

industry and bank involvement. On a 

related note, DMALINK has launched 

its own digital asset venue which 

is catering to large, regulated, FIs. 

This to us, signifies a large move 

in the market towards institutional 

adoption of digital assets and digital 

asset trading. 

What sort of criteria do you look 

at before you invite a market 

maker to join your ecosystem? 

Michael Siwek 

Why has this strategic 

collaboration arrived at a 

very opportune moment for 

DMALINK? 

DMALINK, since its inception, has 

been searching for innovative FX 

solutions outside status quo. We’ve 

adopted a different pricing model 

by not charging LPs, a different 

approach to clients and LPs alike, 

yielding long-lasting relationships. 

Commerzbank is regarded as one 

of the most established German 

banks, a highly regulated, in a fastpaced 

and functioning environment 

where the ‘entrepreneurial’ spirit 

is alive and well. Many large banks 

write about innovation, digitization 

and the likes, hiring teams that 

end up dissolving in a matter of 

months due to lack of direction, 

albeit, enormous budgets spent 

on the endeavour. What we see in 

Great question. The criteria are 

dictated by the clients who use our 

venue for their trade execution, 

settlement and post-trade execution 

analysis. Different clients have 

differing types of flow, whereas 

many banks will be directional, 

as will be the pension funds, it is 

likely that hedge fund clients will 

be taking a different view to the 

market. This means, we must have a 

diversity of liquidity on the platform. 

We look at the currencies most 

traded on the platform, and find 

LPs which excel in that space. From 

there, we’ll look at the sizes they are 

comfortable with and match that 

to the sizes we see going through 


NEWS STORY 

our systems in LD and NY. Then, 

we must look at the timeframes 

with which the banks work when 

internalising positions and compare 

that to the data we see coming 

from the client’s data pool to see 

whether that matches. Lastly, our 

team play a pivotal role here in 

matching the data, the sizes, the 

currencies, to the appropriate LPs. 

From there, we start a 4–6-week 

process of a collaborative approach 

between us, the client and the LP 

whereby we have weekly calls to 

assess the performance on both 

sides of the equation. During this 

time, we often make adjustments 

driven by the data, our sales and 

data teams will jointly speak 

with the LPs and clients to better 

understand the flow and pricing 

and make changes. I wish I could 

say it’s an easier process but, it 

takes time and effort to create a 

working ecosystem, especially, in a 

market where flow and pricing alike 

changes from time to time. 

How will the addition of 

Commerzbank help you to meet 

your core FX liquidity objectives? 

We see a significant demand in 

CEE currencies aside the G5 that’s 

market-dominant in terms of 

volume. Our clients see value in 

trading these pairs given there’s a 

larger potential for profit as margins 

are still larger than those of the 

G5. We were looking forward to 

working with the FX desk and 

the broader Commerzbank team 

to ensure we can provide our 

clients with great pricing, allowing 

them to trade more by driving 

more strategies towards these 

pairs. Commerzbank has a huge 

franchise business of corporates 

and retail clients whereby both can 

lean heavily on their FX expertise, 

from local businesses to large 

multinationals. 

Amidst its expanding asset 

classes, DMALINK remains 

dedicated to embedding FX 

within its electronic trading 

platforms. Why is that and 

what makes your ECN model 

increasingly attractive for many 

trading firms? 

DMALINK is uniquely positioned 

within the FX space by delivering 

multiple touchpoints to our 

clients. As we entered the digital 

asset space, we understand that 

Deliverable FX, settled in a timely 

manner is still a pain point for 

many firms. Given our market-wide 

connectivity to many bank and nonbank 

LPs we can provide wholesale 

prices to the digital asset space 

with same-day delivery (T+0) on 

large orders. This gives LPs access to 

flow based on client transactions as 

opposed to trading strategies. 

A major theme throughout 

this edition of e-Forex is the 

importance of putting data 

at the heart of FICC business 

strategy. DMALINK is well known 

as a data-centric ECN. What 

does that mean in practice and 

what benefits does it deliver for 

clients? 

Absolutely right, we’ve done away 

with manually intense processes in 

favour of machine learning and AIdriven 

liquidity management to help 

us make much faster decisions on the 

ever-changing structure of the flow 

and how it interacts with our LPs. 

This enables us to react far quicker 

than previously possible, and, helps us 

maximize the LP yield while minimizing 

the market impact. 

This month we are also exploring 

the move to T+1 Settlement later 

this year and the potential impact 

this will have on FX. What are your 

own thoughts about? 

Improving settlement-times 

in FX is critical from a capital 

allocation and credit perspective. 

It further reduces counterparty risk 

considerations. 

We currently provide T+0 settlement 

when clients buy or sell fiat 

currencies against crypto currency 

such as Bitcoin, Stable Coins or 

Ethereum. This type of bridge 

between TradFi and DeFi enables 

clients prompt access to capital and 

reduces the burden of overallocation 

of credit. 

What plans do you have this 

year for enhancing DMALINK’s 

and Definity’s product offering 

further and growing its business 

footprint globally? 

As DMALINK continues to grow 

organically, we dive deeper into 

solving the intricate issues found in 

the digital asset space by listening 

to the regulated institutions we all 

know from the world of FX. 

One of the projects we launched 

recently is our Deliverable T+0 FX for 

DeFi. This is a move driven by client 

demand and necessity as the market 

continues to struggle with the FX 

component of the transactions, 

simultaneously as the market 

matures and expects things to be 

done at a much quicker rate. Fiat 

on/off continues to be a struggle for 

many companies. 

Applying institutional FX methods 

from a pre and post trade 

perspective and considering 

counterparty risk metrics, 

and settlement and PB credit 

intermediation systems we are 

currently introducing new trading 

and operational efficiencies into the 

digital assets landscape to make 

crypto trading faster, cost efficient, 

secure and stable. 


EDGE FX RFQ: 

Profiling the groundbreaking 

new RFQ solution from 

Edgewater Markets 

PRODUCT LAUNCH 

We asked Matt Kassel, Chief Operating Officer at the firm to tell us more 

about its exciting new trade execution service. 

Matt Kassel 

What prompted Edgewater 

Markets to design and launch this 

new Request for Quote (RFQ) trade 

execution service? 

Edgewater Markets designed and 

launched the new Request for Quote 

(RFQ) trade execution service in 

response to strong client demand 

and as a natural extension of their 

leading NDF and Spot streaming 

services. Clients value the anonymity, 

credit intermediation, and access 

to deep local liquidity that this 

offering provides through a single 

connection, while effectively reducing 

market impact. With evolving market 

dynamics and changing client 

preferences, there is a growing need 

for more versatile and innovative 

ways to trade, especially for less liquid 

instruments like NDF and NDS. While 

our streaming service is efficient 

for standardized trade sizes, clients 

increasingly expressed the need for 

executing larger trade sizes with local 

providers who specialize and can easily 

accommodate large transaction sizes in 

their local currency. The introduction 

of RFQ trade execution was Edgewater 

Markets’ response to this demand, 

providing clients the flexibility required 

to efficiently manage order flow of any 

size or value date. 

Why is EDGE FX RFQ so 

transformational for the FX trading 

market? 

EDGE FX RFQ service represents a 

transformational shift in how the 

Global FX market transacts for several 

compelling reasons. Firstly, it challenges 

and disrupts traditional trading 

methods that heavily rely on voice and 

chat interactions. By automating the 

workflow, EDGE FX RFQ allows local 

liquidity providers to scale their business 

and extend their reach, enhancing 

overall global market efficiency. 

In addition, the service is the first 

of its kind to provide anonymous 

RFQ trading coupled with credit 

intermediation. This unique feature not 

only ensures that market participants 

can execute trades with enhanced 

privacy, but it also simplifies access to 

deep local providers who specialize 

in their currency. This innovation is a 

game-changer, allowing traders to 

effectively manage their positions, 

while providing access to a wide array 

of local liquidity sources through a 

single platform. 

What customization of orders is 

possible with EDGE FX RFQ? 

EDGE FX RFQ offers a remarkable 

degree of order customization, 


PRODUCT LAUNCH 

granting users full control over the 

execution of their trading strategies. 

Users can opt for one-sided or twoway 

orders, tailoring their orders 

to specific market conditions and 

individual preferences. Additionally, 

the platform accommodates the 

trading of broken dates and swaps 

across FX metals and NDFs. This level 

of customization empowers traders 

to engage the market directly for 

large size orders resulting in a single 

trade and counterpart, enhancing 

their ability to navigate the FX market 

effectively and efficiently. 

What other key features does 

EDGE FX RFQ incorporate? 

EDGE FX RFQ incorporates a 

unique set of features to optimize 

the foreign exchange trading 

experience. Notably, the platform 

facilitates the aggregation of the 

best bids and offers from multiple 

local providers via a single credit 

line, fostering competitive rates and 

streamlined trading. The inclusion 

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FX measures the impact of 

the latest FX Global Code 

review and imminent move 

towards T+1 settlement 

By Vivek Shankar 

REGULATORY ISSUES 

The Global Foreign Exchange Committee (GFXC) and 

its Code have played an integral part in standardising 

FX market practices. Adopting the Code’s 55 principles 

is voluntary and has prompted significant cooperation 

between private and public sectors. The latest of the GFXC’s 

periodic reviews closed late last year, with the results 

due for publishing in January 2024. What are some of the 

concerns in this latest iteration, and will Code changes 

address the T+1 elephant in the room? 

Image by Shutterstock 



A BRIEF OVERVIEW OF CODE 

ADOPTION 

“In the six years since it was 

established, the Code has expanded 

its reach across the FX industry,” Anna 

Nordstrom, Head of the Domestic and 

International Markets Functions at the 

New York Federal Reserve Bank (The 

Fed,) said in October last year at FX 

Markets USA. 

She explained that over 1,000 

market participants worldwide have 

adopted the Code, with the adopters’ 

nature changing. “Whereas the 

initial adopters were bank dealers, 

platforms, and technology providers, 

we have seen greater adoption by the 

asset management community more 

recently,” she said. 

Currently, 11 of the top 15 asset 

management firms in the US adhere to 

the code, representing $36 trillion of 

assets under management. While these 

numbers paint a positive picture, is the 

Code adoption having any significant 

effects on FX market practices? 

Nordstrom’s comments suggest it is. 

“Many trading venues have reduced 

the maximum length of their “last 

look window,” a significant number 

of large bank dealers have announced 

an end to additional hold times, and 

several electronic trading platforms 

now offer trading venues from which 

non-Code-compliant liquidity providers 

are excluded,” she said in her speech. 

Nordstrom also noted the Chartered 

Financial Analyst program’s decision 

to reference the Code in its Level 

1 certification materials, lending 

further credibility. Past Code reviews 

have highlighted the importance of 

standardising Last Look and Pre- 

Hedging procedures. 

Recent modifications to the Code 

addressed settlement risk concerns. 

Lisa Danino-Lewis, Chief Growth 

Officer, CLS, explains. “The FX 

Global Code includes key principles 

concerning settlement risk (principles 

35 and 50) that emphasise the use 

of payment-versus-payment (PvP) 

settlement mechanisms where 

available,” she says. 

“It recommends the use of bilateral 

netting in cases where PvP settlement 

is not [available.] We continue to see 

growth in adoption of our products, 

CLSSettlement, Cross Currency Swaps, 

and CLSNet, that support market 

participants’ adherence to these 

principles.” 

And what do volumes look like? 

“CLSSettlement volumes have grown 

steadily with average daily values 

settled exceeding USD6.5 trillion 

across 18 currencies”, she says, “which 

accounts for a large proportion of FX 

trades in the market.” 

“In parallel, the adoption of CLSNet, 

CLS’s standardised bilateral netting 

calculation service, has continued to 

grow with the average daily notional 

value of net calculations consistently 

exceeding USD115 billion in the last 12 

months.” 

FX settlement risk will likely feature 

heavily in the GFXC’s latest Code 

review. While market participants will 

have to wait till January to understand 

how the GFXC will approach changes, 

the committee’s history of recent Code 

changes offers plenty of hints. 

In addition to the changes Danino-Lewis 

highlights, the GFXC also concluded 

that more frequent collection of FX 

settlement data through semi-annual 

surveys distributed by regional FX 

committees was wise. 

The committee also launched a 

working group led by the Bank of 

England to review and enhance 

existing FX settlement data collection 

templates. All this talk of settlement 

risk is leading to the issue of US T+1 

settlement, as the reader can guess. 

While the switch to T+1 was aimed 

at US equities, the FX impact is 

significant. 

LOOMING T+1 IMPLICATIONS 

FOR FX SETTLEMENT 

The Global Financial Markets 

Association notes that the foreign 

holding of US equities stood at USD 

12.1 Trillion in May 2023. Europe 

accounts for 48% of those holdings 

with Asia coming in second place 

at 22%. The move to T+1 doesn’t 

necessarily complicate the settlement 

picture as much as accelerates 

processes within it. 

CLS’s Danino-Lewis explains that 

a trade’s FX component will need 

settling before the equity portion. “To 

understand the potential impact of 

the move to T+1 for asset managers 

and funds accessing CLSSettlement 

through third-party service providers, 

CLS analysed its transaction data,” she 

says. 

“This analysis concluded that a value 

equivalent to approximately 1% 

of CLSSettlement’s average daily 

settlement value (USD6.5 trillion) is 

executed on a T+1 basis, comprising 

volumes where one side is USD, and a 

fund is a party to the trade.” 

“Therefore, the maximum value 

that may need to move to T+0 

after May 2024 by this community, 

is approximately USD 65 billion, 

assuming there are no trading and 

operational process changes by 

industry participants.” 

Walking through a sample scenario 

facing international asset managers 

is instructive in understanding T+1’s 

impact. A fund manager based in the 

EU must sell EUR and buy USD when 


FX measures the impact of the latest FX Global Code review and imminent move towards T+1 settlement 

“The FX Global Code includes key principles concerning 

settlement risk that emphasise the use of payment-versuspayment 

(PvP) settlement mechanisms where available” 

advances in artificial intelligence (AI) and 

robotic processing automation (RPA) 

offer great potential.” 

Penney reckons the FX market must 

indirectly through custodian banks 

that manage all payment instructions 

and funding relating to their clients’ 

FX trades,” she says. 

evolve and embrace new products to 

overcome market structure challenges. 

“The good news is that FX is largely an 

automated industry and as such error 

rates are very low,” he says. 

“As part of this process, these custodian 


Lisa Danino-Lewis 

purchasing US equity. The amount of 

USD they need will only be known 

when the equity transaction occurs. 

Assuming the equity trade occurs 

at the New York market close (9 PM 

GMT,) the fund manager must settle 

their trade the following day, making 

it a T0 settlement. The manager can 

settle through CLS, since EURUSD 

is CLS-enabled, mitigating any 

settlement risks. 

banks set their own cut-off times 

for CLS-related settlement to ensure 

adherence to CLS’s deadlines. CLS is also 

exploring how its services can assist in 

this issue and has conducted feasibility 

studies with both the buy side and 

sell side on adjusting CLSSettlement 

processes to accommodate later 

submission of instructions for 

settlement.” 

Automation will play a role here, 

Danino-Lewis says. “For instructions that 

do not meet CLS’s 00:00 CET deadline, 

CLSNet, can enhance post-trade 

efficiencies and mitigate risk.” 

“The service helps buy- and sellside 

participants reduce funding 

requirements and the number of 

“Equally, as automation increases 

amongst investment managers,” he 

continues, “the error rates generated 

from failed trades in securities markets 

will also drop significantly. Investment 

managers will have an increased need 

for cash liquidity, which could be fulfilled 

through new products, while credit and 

pricing mechanisms may need to be 

adjusted to a shorter time horizon.” 

In her speech at FX Markets USA last 

year, the New York Fed’s Nordstrom 

outlined a few considerations market 

participants will have to tackle. “FX 

market participants will need to 

carefully analyse their operational and 

liquidity management practices to avoid 

disrupting market functioning,” she said. 

However, the trade remediation window 

reduces significantly. The picture is 

even more complex for Asia-based 

asset managers. With markets closing 

before New York opens, T0 transactions 

are a given. However, the lack of CLS 

enablement in several Asian emerging 

currencies increases settlement risk. 

payments required by calculating net 

payment obligations that facilitate 

payment netting. CLSNet also 

enhances operational efficiencies 

through full automation, removing 

manual interventions from the netting 

calculation process.” 

Neill Penney, Group Head of FX, LSEG, 

“Stakeholders may also need to make 

substantial improvements to their 

existing operational systems and 

reconfigure FX settlement processes. 

An additional consideration is how 

T+1 will affect the values and volumes 

that currently settle through paymentversus-payment 

arrangements.” 

Fund managers will have to settle 

outside CLS while dealing with 

local market controls. One way of 

mitigating local control risks is to prefund 

the transaction, but this results in 

increased trading costs. 

expands on the technology theme. 

“There are aspects of the workflow 

change that are universal, especially 

when it comes to technology,” he says. 

“Without greater automation, firms 

will face a struggle with both their FX 

funding and hedging operations.” 

Nordstrom pointed out that while 

CLS can support this change, the 

volume of bilateral trade settlement 

outside CLS will increase, pushing 

settlement risk up. So, what are some 

of these considerations and how must 

stakeholders evaluate their processes? 

Danino-Lewis explains CLS has been 

working with market stakeholders to 

understand these risks better. “Asset 

managers access CLSSettlement 

“The key to a successful transition 

to the new environment will be the 

efficient transmission of data to both 

internal and external systems – and here 

KEY CONSIDERATIONS FOR A 

SMOOTH T+1 MOVE 

The first consideration that springs 

to mind is local currency cut-off 


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efficiency in post-trade 

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“Without greater automation, firms will face a struggle with 

both their FX funding and hedging operations.” 

times and holidays. Local central and 

commercial banks dictate currency 

settlement hours that affect settlement 

time windows. 

With each country adhering to 

different RTGS hours that govern 

currency cut-off times,) the challenge 

is one of coordination for asset 

managers. Correspondent bank 

hours and cut-offs also impact the 

settlement window. 

Neill Penney 

Technology and automated scheduling 

are obvious solutions to this puzzle 

and settlement risk. As Danino- 

Lewis explained, CLS has solutions, 

for trades that miss the 00:00 CET 

deadline, such as CLSNet which covers 

more than 120 currencies. 

Asset managers trading EM currencies, 

for instance, must account for 

additional credit lines and increased 

costs. Sticking with the EM theme, 

some of those currencies come 

with capital controls and trading 

restrictions. 

With trade remediation windows 

squeezed due to T+1, participants will 

have to plan execution avenues ahead 

of time. For instance, some currencies 

will need to be transacted through 

local exchanges that bring unique 

nuances to the picture. 

If the picture is too opaque, a 

prefunded mechanism to settle a T+1 

transaction might be the solution. Of 

course, this increases costs. The GFMA 

notes that some fund managers are 

establishing US-based operation hubs 

to smooth settlement, but this option 

might be excessive for smaller fund 

managers. 

The body notes in its report, 

“Consideration should also be given to 

the benefits of improving operational 

efficiencies, including investment 

in technologies that focus on the 

increased automation of processes, 

and to assessing the viability of 

using third-party vendors. Increased 

automation offers the advantages of 

operational efficiencies and could help 

to address the time-zone challenges.” 

“Trading platforms could also see an 

increase in demand for multi-asset 

trading and settlement capabilities,” 

it continues. “Simultaneous execution 

and increased process automation 

of equity and currency trades in 

tandem will assist in expediting the 

confirmation and settlement process 

required to meet the T+1 deadline.” 

The GFMA also notes that FX trading 

activity may increase towards the end 

of the New York day, a period where 

liquidity historically drops off. T0 FX 

trades may also spike, needing trading 

desks to pay special attention to 

funding needs. 

“Fund managers also aim to offer “best 

execution” and price transparency for 

their clients, often using the WMR 11am 

NY/4pm London benchmark to execute 

FX trades for international equity 

transactions,” GFMA’s report notes. 

“The amount of FX to be transacted 

is dependent upon the confirmed and 

matched equity transaction, which may 

not occur in time for a benchmark trade 

for T+1 settlement.” 

FX market participants will need to carefully analyse their operational and liquidity management practices 

“The risk of executing FX trades 

against unconfirmed/unmatched 

equity trades needs to be weighed 


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“An additional consideration is how T+1 will affect the 

values and volumes that currently settle through paymentversus-payment 

arrangements.” 

up against the operational risks of 

increased trade amendments or 

cancellations.” 

Anna Nordstrom 

RISK AND COST IMPACT 

Given the shorter timeframe T+1 

creates, automation will prove critical 

for firms looking to mitigate risk. 

For instance, Standard Settlement 

Instruction (SSI) loading and verification 

will come under stress in a T+1 

environment. Sell-side firms will face 

limited timeframes to execute same-day 

account setups for new clients. 

Automating onboarding is one 

solution to this challenge. Automation 

can also solve issues in pre- and 

post-trade processing from KYC/AML 

checks and loading SSIs to matching 

and confirmation. 

In contrast, the buy side might find 

currency management challenging 

and could consider adopting passive 

currency strategies. Leveraging external 

providers with local market experience 

and access is another option. 

Most stakeholders will be keeping an 

eye on costs, given current market 

conditions. Pre-funding involving EM 

Asian currencies will increase costs. 

However, as interest rates rise, interest 

costs on late payments will likely have 

a significant impact. 

EU-based entities will have to 

contend with Central Securities 

Depositories Regulations (CSDR) that 

obligate them to disclose the adverse 

impact of late settlement fees. 

Infrastructure and workforce changes 

will also likely create a significant 

cost impact. 

With accelerated timelines in place, 

firms must consider augmenting 

existing roles with more personnel 

or introducing automation to the 

mix. Integrating these new roles with 

existing processes will need time, 

something that is a hidden cost. 

In some cases, shifting operations to a 

US-based location might make sense, 

despite high costs. If the impact of 

a smoother settlement reduces risk, 

firms could justify higher operational 

costs. 

THE ROLE OF TECHNOLOGY 

AND AUTOMATION 

Speaking of technology, Distributed 

Ledger Technology (DLT) offers a 

curious peek into what could be the 

future. DLT promises a T0 settlement, 

given the blockchain’s immutability. 

However, it isn’t in any usable shape 

for the institutional market and it lacks 

large scale industry adoption, as well 

as any proven track record, unlike 

existing solutions. 

Despite the current limitations of new 

technologies, such as DLT, one fact 

is for certain: greater automation of 

post trade practices using existing 

technology will help to solve any 

challenges firms face due to T+1 

settlement. How comprehensively 

firms automate their post trade 

services will prove critical in preparing 

successfully for T+1. 

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Look-ahead: 

What lies in store for e-FX in 2024? 

MARKET COMMENTARY 

Nicholas Pratt spoke to a number of key industry players about the year ahead 

to see what we should expect for the FX market in several important areas 

including settlement, digital assets, data analytics, algo trading and FX swaps. 

Vittorio Nuti 

VITTORIO NUTI, GLOBAL HEAD 

OF LD & FX ALGO TRADING 

AT DEUTSCHE BANK, ON FX 

ALGO TRADING & EXECUTION 

ANALYTICS: 

Algo execution in FX has been 

expanding at a decent pace over 

the last five to seven years, and I 

believe the product will enter a new 

phase in 2024. This phase involves 

a slowdown in growth from the 

typical client base and an increase 

in hedge fund business. Hedge fund 

clients will be looking at execution 

more holistically, particularly 

considering the hidden costs of 

executing, such as co-located servers, 

IT costs for maintaining systems, 

and connections. This shift has the 

potential to change the landscape 

for FX algos. 

Regarding the development of 

new algos, we observe the FX algo 

business maturing, and we expect 

providers to differentiate their 

products by offering better quality 

of execution. This quality will be 

assessed quantitatively via third 

party TCA. As the client base will 

changes, further customisation of 

algo outcomes will be important 

to optimise client requirements. At 

Deutsche Bank, we’ll be focusing on 

delivering the successes achieved 

in FX to our Listed Derivatives 

platform. 

Balraj Bassi 

BALRAJ BASSI, CO-FOUNDER & 

CEO OF TRADEFEEDR, ON DATA 

ANALYTICS: 



Data analytics in the FX market has now 

reached the point where clients have 

access to complete global data sets, 

capturing data from across multiple 

counterparties and venues, then making 

it available for analysis. We expect that 

2024 to be the year where these data 

sets change how counterparties interact 

with each other and enable increased 

automated trading workflows. 

far more fragmented than in FX. 

Firms want to receive market data 

and execute first. Co-location is 

becoming essential and given the 

rate of change of venue offerings, 

trading firms require active 24/7/365 

support. 

As more information becomes available 

on data networks, it is now easier than 

ever for buy-side and sell-side firms 

to interact and collaborate, to make 

informed decisions about who they 

trade with and how they execute trades 

most effectively and profitably. 

This is far beyond Transaction Cost 

Analysis (TCA), as trading data is now 

available to inform trading decision 

making in pre-trade. 

Automation is a key trend for 2024. 

During Q4 last year we started to see 

some clients’ trading desks automate 

their workflows using the information 

contained in our data network. As 

an example, we see this with our 

Algo Forecasting model, which uses 

performance data from FX execution 

algos to identify the most appropriate 

algo for specific orders. 

Clients use this in pre-trade to select 

specific execution algos, and some firms 

are automating this whole process, 

using APIs to gather forecasts on specific 

trades before automatically sending 

orders to execution algos. As firms 

look to increase workflow efficiency, 

we expect this type of automation to 

increase in 2024. 

As firms increasingly use data in all 

parts of their trading, we have seen 

demand for data networks supporting 

multiple asset classes. Tradefeedr’s initial 

focus was FX, but in response to client 

requests we will launch Equities and 

Futures in 2024. 

Rob Wing 

ROB WING, HEAD OF DIGITAL 

ASSETS & FX AT 4OTC: 

Over the past two years we have 

seen more financial institutions move 

into digital assets trading. We expect 

this to continue during 2024, as 

investors continue to diversify their 

portfolios with a range of crypto 

assets, including Bitcoin, Ethereum 

and other more established crypto 

currencies. 

The recent SEC approval of Bitcoin 

ETFs will make it significantly easier 

for large pools of institutional capital 

to be deployed, pushing Bitcoin 

prices higher (with some predicting a 

new all-time high). What is certain is 

that there will be renewed interest in 

some of the more established crypto 

currencies. 

The market remains highly 

fragmented, with institutional 

traders typically connecting to 

between five and 25 exchanges 

globally to access market data and 

liquidity. As with other asset classes, 

firms are demanding institutionalgrade 

infrastructure to access these 

markets in the form of robust, 

secure, and low latency connectivity. 

They also require failover and 

full disaster recovery procedures. 

The digital assets markets are 

Lisa Danino-lewis 

LISA DANINO-LEWIS, CHIEF 

GROWTH OFFICER AT CLS, ON 

FX SETTLEMENT: 

Exploring ways to tackle rising 

settlement risk in emerging market 

(EM) currencies will continue to be a 

priority for the FX market next year. 

Adding currencies to CLSSettlement 

requires ongoing support from the 

relevant central bank and can require 

changes in the jurisdiction’s laws. 

Given these challenges, CLS will 

continue to focus its efforts on 

addressing this issue by enhancing 

CLSNet, our standardized, automated 

bilateral payment netting calculation 

service across 120 currencies. CLSNet 

reduces payment obligations exposed 

to settlement risk while improving 

operational and liquidity efficiencies. 

With an implementation date of 28 

May 2024, supporting FX market 

participants through the move to T+1 

securities settlement in the US and 


Look-ahead: What lies in store for e-FX in 2024? 


Canada will be another priority next 

year. As 20% of US securities and 

16% of US equities are held in foreign 

portfolio holdings, the move to T+1 will 

impact many cross-border transactions. 

This is because to settle cross-border 

securities on T+1, the FX component 

of the transaction needs to be settled 

prior to the settlement of the security. 

CLSSettlement can support the trade 

flows resulting from a move from 

T+2 to T+1. However, time zone and/ 

or operational constraints may require 

some cross-border market participants 

to adjust their FX post trade practices 

in order to meet T+1 requirements. 

CLS is engaging with both sell- and 

buy-side clients to explore how 

our current suite of products can 

assist the market in the shortterm 

and consider the feasibility of 

adjusting CLSSettlement processes 

to accommodate later cut-off 

times. However, our main priority is 

maintaining the stability of the FX 

ecosystem, so any adjustments will 

need to be carefully considered. 

Dirk Bullmann 

DIRK BULLMANN, GLOBAL 

HEAD OF PUBLIC POLICY AT 

CLS, ON DEVELOPMENTS 

AROUND CENTRAL BANK 

DIGITAL CURRENCIES (CBDCS): 

Since the term ‘CBDC’ was coined 

almost a decade ago, there has 

been increasing engagement 

globally by both the public and 

private sector in CBDC research 

and experimentation. In 2023, we 

observed an increasing focus on 

wholesale CBDC and saw some 

significant advances in the work 

around cross-border payments. 

We expect wholesale crossborder 

CBDCs to continue to be a 

significant theme for the coming 

year. As CLS provides a multicurrency, 

cross-border and wholesale 

payment system, which forms the 

settlement backbone of the global 

FX market, those developments are 

particularly relevant for us. 

We have established an innovation 

lab to follow and support CBDC and 

other initiatives where relevant. CLS 

is for example among a group of 30 

financial institutions participating in 

a second phase of the SWIFT CBDC 

sandbox testing to explore FX and 

other use cases. 

As regards the use of new 

technologies such as DLT, we are 

always evaluating new opportunities 

to deliver enhanced services to 

our clients and mitigate risk in 

the FX market. However, any new 

technological solution must deliver 

efficiencies and/or reduce costs 

while also meeting extraordinarily 

high standards of resilience. 

Technology can only transform the 

market when it is translated into 

solutions that solve real business 

problems. That requires a deep 

understanding of business processes 

and platforms, and for activities 

currently undertaken by FMIs, 

such as CLS, the correct levels of 

oversight, governance, credibility 

and trust. 

Peer Joost 

PEER JOOST, CEO OF DIGITEC, 

ON DEVELOPMENTS IN THE FX 

SWAPS MARKET: 

Technology will be the key theme 

of 2024. With increasing trading 

volumes, greater involvement from 

banks of all sizes and further buy-side 

participation, the FX Swaps market 

will continue its rapid volume growth 

and migration to electronic channels. 

This will drive further demand for 

accurate and robust pricing engines, 

and more automated end-to-end 

workflows. Staying ahead of the game 

will require much faster adoption of 

technology than we’ve seen in the 

past and this can only be achieved by 

frequently updated and scalable SaaS 

solutions. 

We will continue to see banks of all 

sizes moving away from spreadsheetbased 

or manual pricing, and instead 

implementing accurate and robust 

pricing engines. These are required 

to accurately price in the rapidly 

moving electronic FX markets. Pricing 

FX Swaps is complex, and the scale 

of the challenge is demonstrated 

by Market Maker banks typically 

calculating 20,000 prices along their 

forward curve. 

Automating workflows is another key 

trend for 2024, which will drive the 

further adoption of technology. All 



banks and the buy-side are already 

looking to improve automation 

throughout the trade lifecycle, to 

cut costs and have the capacity to 

manage more client business. Client 

demand to trade FX Swaps across 

more currencies and dates is growing 

and banks are looking for efficient 

ways to manage that additional 

volume. 

The importance of data will grow as 

more pricing engines are implemented 

and more banks automate workflows. 

We continue to see more banks using 

the Swaps Data Feed (SDF). For banks 

and traders to fully build and maintain 

their own curves, the SDF allows 

them to improve pricing and extend 

currency coverage. 

We also expect to see an increase 

in the electronic trading of these 

instruments in 2024. As clients look 

to FX Swaps as a source of global 

funding there is demand for their 

relationship banks to provide liquidity 

across multiple currencies and tenors. 

The only realistic way for banks to 

manage this client business in an 

efficient way is by trading using 

electronic channels, and automating 

workflows - in data, pricing, 

distribution, and settlement. 

As the FX Swaps market continues to 

grow, we also expect to see regional 

banks trade more FX Swaps. In the 

past many could not justify the 

investment in on-premise applications, 

but with SaaS apps deployed in the 

cloud they are increasingly adopting 

FX Swaps pricing technology to 

service their client needs. This pricing 

technology enables regional banks 

to price more accurately and faster 

– both of which are essential for 

electronic markets. 

Electronification and automation 

result in better pricing along the 

curve, more clients serviced, more 

currencies traded, and more quotes 

accurately auto-priced – leading 

to increased trading volumes and 

improved client service. Typically, 

when a regional bank goes live with 

our D3 solution combined with the 

SDF, they are able to expand their 

offering beyond G10 and specialist 

currencies. 

Electronic trading increases the need 

for accurate pricing and any bank 

publishing a wrong price is likely to 

quickly lose money. As banks look to 

attract more business electronically, 

we are already seeing tighter prices, 

but the main theme is that price 

accuracy along the forward curve has 

improved significantly. 

In 2024 Interdealer trading of FX 

Swaps, which has traditionally been 

dominated by the broker market, 

will start to migrate to electronic 

venues like 360T and LSEG. After 

our recent launch of D3 OMS we 

are seeing significant interest as 

banks look to access these venues 

to efficiently manage risk positions. 

As a result, we expect to see 

increased volumes on electronic 

interbank matching platforms, 

which will drive increased market 

liquidity, greater participation, 

improved client pricing and risk 

management, and for the FX Swaps 

market to grow for the benefit of 

all parties. 

FINALLY, JEFF WARD, CEO 

AT FXSPOTSTREAM, TALKS 

ABOUT THE KEY TECHNOLOGY 

DECISION THIS LEADING 

PROVIDER WILL BE MAKING IN 

2024. 

When considering developments in the 

FX market, it is important to note that 

these do not happen overnight, and 

the trends are already in place. In 2023, 

we began reporting our spot volumes 

Jeff Ward 

separately and found that, while spot 

had remained fairly flat compared to 

our record year in 2022 – we actually 

saw strong growth in other products, 

namely NDFs (up 42.05% from an ADV 

perspective in 2023 vs 2022). 

As with any service, a growth in 

volumes can come in one of two ways: 

through new additions, whether that 

be in the form of new clients or adding 

new liquidity providers (LPs), or through 

working with clients to maximize their 

relationships with their LPs. FX is, and 

always has been, a relationship driven 

business and understanding what 

each side is thinking puts us in a great 

position to help. 

As with any technology provider, there 

are several technology decisions we 

will have to make in 2024. Last year 

we embarked on our ultralow-latency 

network migration and this year will 

move on to the next phase of the 

project, specifically the order entry and 

order confirmation processing. 

Whenever we make a decision for 

the company, there are obvious risk 

versus reward questions, and ultimately 

the biggest driver in these is usually 

the value added for the client and/ 

or FXSpotStream LPs. We maintain a 

constant dialogue with both sides and 

are always looking for ways to improve 

their experience. 


The growth of CLSNet: 

The next best thing 

after CLSSettlement 

By Marc Bayle de Jessé, CEO of CLS. 

grapples with these challenges, CLS’s 

role in managing settlement risk, 

especially for currencies not eligible for 

CLSSettlement, becomes increasingly 

crucial. 

has been the asset management 

community. Asset managers access 

CLSSettlement via settlement members 

that provide third-party services, as 

do other indirect participants like 

PROVIDER VIEWPOINT 

Marc Bayle de Jessé 

As emerging market (EM) currencies 

Settlement risk remains one of the 

most significant risks in the FX market 

today. CLS currently settles 18 of 

the most actively traded currencies 

globally, for over 70 settlement 

members comprising the world’s 

leading financial institutions and 

over 35,000 indirect third-party 

participants. 

corporates, banks and non-bank 

financial institutions. Notably, almost 

80% of the top 250 investment 

managers are now settling through 

CLSSettlement via their custodian 

banks 1 . 

To gain further insight into the 

pockets of remaining settlement risk, 

CLS collaborated with a subset of its 

settlement members to analyze their 

continue to outpace the market in 

terms of growth, the FX market has 

seen renewed attention towards 

reducing FX settlement risk. 

Policymakers and regulators are 

exploring ways to expand paymentversus-payment 

(PvP) settlement to 

currencies for which it is not currently 

available. This heightened concern 

about mitigating FX settlement risk 

CLSSettlement is the industry’s 

settlement risk success story. It was 

created to mitigate FX settlement 

risk by providing PvP settlement. PvP 

ensures the final transfer of a payment 

in one currency occurs if, and only if, 

the final transfer of a payment in the 

counter currency (or currencies) takes 

place. 

FX trades and determine how they 

were settled. The findings indicated 

how the market manages settlement 

risk and the range of mechanisms 

used to settle FX flows. It showed 

that around 90% of the settlement 

risk exposure associated with their 

FX trades in the 18 CLS-eligible 

currencies was successfully mitigated 

via CLSSettlement with full PvP. 

has sparked industry discussions about 

how best to address it. 

FX settlement risk is sensitive to today’s 

growing geopolitical challenges as well 

as market and economic turbulence. 

Amid this backdrop, market 

participants are seeking to maximize 

liquidity and minimize risk in their FX 

settlement practices. As the industry 

Recent CLSSettlement growth 

statistics demonstrate that CLS is 

achieving what it set out to do. In 

2023, CLS settled an average daily 

value of USD6.6 trillion of FX payment 

instructions, and in December, it 

settled a new daily record of USD16.3 

trillion (previous record was USD15.3 

trillion on 15 December 2021). A 

major contributor to this growth 

Successful settlement risk mitigation 

has been achieved for CLS-eligible 

currencies. However, with the growth 

in EM currency trading, the remaining 

challenge is to mitigate settlement 

risk for currencies ineligible for PvP 

settlement. Given CLS’s systemic 

importance, adding new currencies to 

the settlement service is an extended 

26 JANUARY 2024 e-FOREX 

1 Excluding Chinese based investment managers

PROVIDER VIEWPOINT 

effort that requires ongoing support 

from the relevant central bank and the 

industry, and the target jurisdiction’s 

laws and regulations may need to be 

changed. 

CLS has been exploring ways to 

expand PvP coverage. However, to 

achieve progress in this area, public 

and private sector stakeholders will 

need to closely collaborate over 

multiple years to overcome regulatory 

and geopolitical challenges and arrive 

at an industry solution. 

For now CLS is focusing on enhancing 

CLSNet, its automated bilateral 

payment netting calculation service 

for over 120 currencies. CLSNet helps 

to mitigate operational risk for EM 

currency trades. By standardizing and 

automating the netting calculation 

process, it facilitates the reduction 

of payment obligations exposed 

to settlement risk while improving 

operational and liquidity efficiencies. 

Moving forward, CLS’s priority will 

be to enhance CLSNet’s functionality 

even further to effectively address 

settlement risk for EM currencies. 

Public policy efforts have focused on 

the issue of mitigating settlement 

risk. Building block 9 of the Financial 

Stability Board’s cross-border roadmap 

focuses on increased adoption of 

PvP settlement. The FX Global Code, 

published by the Global Foreign 

Exchange Committee, includes key 

principles concerning settlement risk 

(principles 35 and 50) that emphasize 

the use of PvP settlement mechanisms 

where available and recommend the 

use of bilateral netting in cases where 

PvP settlement is not available. 

CLSNet supports adherence to these 

principles, as trade details sent to 

CLSNet are validated and matched 

up to the pre-determined cut-off 

times between counterparties for 

each currency. This ensures that only 

confirmed trade details are included 

in the automated net calculation and 

that there is a single common record 

of the net payment obligations. By 

automating the netting process via 

a centralized platform, participants 

benefit from greater operational 

efficiency and increased risk 

mitigation for currencies currently 

unable to settle in CLSSettlement. 

CLS believes that the true benefits 

of the bilateral netting calculation 

process can only be realized with 

an industry utility model that 

is centralized and standardized, 

underpinned by an underlying 

rulebook. Crucially, these types of 

conditions are most likely to produce 

the network effect, which is essential 

if such services are to deliver optimal 

benefits to FX market participants. 

Recent CLSSettlement growth 

statistics demonstrate that CLS is 

achieving what it set out to do. In 

2023, CLS settled an average daily 

value of USD6.6 trillion of FX 

payment instructions, and in 

December, 2023 reached a record of 

USD445 billion netted. The growing 

CLSNet community already includes 

eight of the top ten global banks 2 , 

and extending the network to more 

banks, funds, corporates and nonbank 

financial institutions is a priority 

for the coming year. CLS is confident 

that the tangible benefits of the 

service will continue to drive uptake 

of the service. 

Further, when the US and Canadian 

securities markets move to T+1 

settlement in May 2024, the asset 

manager community and other market 

participants will face new challenges 

with the FX post-trade lifecycle, 

including time constraints that may 

limit the use of CLSSettlement. 

CLSNet can help to reduce funding 

requirements and payment instructions 

by calculating net payment obligations 

that facilitate payment netting. 

CLSSettlement is doing what it set 

out to do: mitigate FX settlement 

risk. Growth numbers and settlement 

risk analysis demonstrate the strong 

industry support for the service. 

Settlement risk is largely mitigated for 

CLS-eligible currencies. 

With the growth in EM currency 

trading, the remaining challenge is 

how best to mitigate risk for currencies 

ineligible for PvP settlement. For 

now, we believe this is CLSNet. 

Recent growth reflects the industry’s 

support for the service and its need 

for a centralized, standardized, and 

automated process that enables them 

to mitigate operational risk, optimize 

liquidity and create operational 

efficiencies. CLS’s role is to continue 

building the CLSNet community – a 

key priority for 2024. 

2 

Euromoney Global FX Survey 2022 


Exploring the state of 

e-FX and associated 

fintech in Southern Africa 

REGIONAL E-FX PERSPECTIVE 

Analysing the state of e-FX in Africa is always a challenging task. The 

continent’s diversity prevents observers from identifying any unifying 

trends. However, one can safely say that electronification is increasing 

throughout the continent, even in sub-regions where voice and manual 

RFQs dominate. Vivek Shankar investigates. 





Exploring the state of e-FX and associated fintech in Southern Africa 

“We see great potential for expansion of electronification 

across the board where many African countries still have a 

large portion of the FX execution done on a manual basis,” 

price distribution have been key focus 

points.” 

electronification on a continental 

level is huge. “We see great potential 

for expansion of electronification 

across the board where many African 

countries still have a large portion of 

the FX execution done on a manual 

basis,” he says. 

Electronification has particularly 

“With the use of already developed 

touched corporate treasury activity in 

infrastructure that can support the 

the continent’s more mature markets, 

management and price creation for 

such as South Africa. Naturally, this 

local market currency pairs, both 

wave has brought unique risks with it. 

the buy and sell sides would tend to 

move towards transparency and faster 

“Best execution in emerging markets 

execution that electronic FX trading 

can mean different things,” says 

provides.” 


Ryan Tolmay 

“It’s no secret that Africa has embraced 

technology, and this can be seen in 

the adoption of digital payments and 

mobile money services,” says Ryan 

Tolmay, Sales Manager, Africa Sub 

Sahara at 360T. “This cultural change 

has pushed the sell side to look at what 

digital services they offer their clients 

and trading is no exception.” 

“From a bank standpoint,” he 

continues, “we see that there has been 

a focus on their internal workflows. 

The ease of access to and adoption 

of technology to optimise specific 

areas including liquidity sourcing and 

Tim Hutchinson, Head of Electronic 

Execution and FX, Markets at Rand 

Merchant Bank (RMB.) “The choppiness 

of the liquidity, the fact that few 

regional players can market make 

certain currencies, all of whom are 

at different stages of their electronic 

trading journey, puts corporates in an 

interesting position.” 

Is electronification posing more 

challenges than it solves in African 

e-FX? Here’s a look at how market 

participants are handling them and 

what moves we may see soon. 

ELECTRONIFICATION IS NOT A 

SILVER BULLET 

Tolmay notes that the potential for 

However, Hutchinson is quick to point 

out that electronification doesn’t solve 

issues automatically. Corporates have 

realised the benefits of automating 

execution and are now exploring its use 

for other treasury activities. 

The goal here, Hutchinson notes, is 

to give more time back to treasury 

departments that enable value-added 

work. But just utilising electronic 

channels doesn’t guarantee a client 

best execution. 

“It’s been quite fascinating to watch 

how Request for Quote tickets from 

clients on a multi-dealer platform sit 

open for quite some time,” he says. 

“This tells me that not all of those 

banks can handle client requests in 

an automated fashion. As a result, 

clients are disadvantaged here because 

markets by their nature are moving 

continuously. This is something we’re 

encouraging our clients to be curious 

about when using the likes of a 

multi-bank-portal seeking to get best 

execution. Clients may not have the 

tools to automatically scan a best 

execution report, but being curious 

about what they’re seeing from their 

banks pricing behaviour is beneficial.” 

Corporates have realised the benefits of automating execution and are now exploring its use for other treasury activities 

He lists a few examples of events to 

look at. “Why certain banks take longer 


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“Clients may not have the tools to automatically scan a best 

execution report, but being curious about what they’re 

seeing from their banks pricing behaviour is beneficial.” 

Tim Hutchinson 

to price back than others, how often 

price updates are generated, how their 

requests are handled at different times 

of the day as well as the consistency in 

decimal places within quotes between 

providers. It may sound simplistic, but 

banks that quote manually tend to 

quote up to four decimal places since 

the Dollar-Rand is priced that way in 

the matching market.” 

“Banks with electronic quoting abilities 

go up to five places,” he continues. 

“These are some of the things we’ve 

been encouraging treasurers to be 

much more conscious of.” 

The core issue here is the definition of 

best execution. What does that phrase 

mean specifically when dealing in an 

emerging market? Treasurers will find 

going back to first principles useful 

when figuring this out. First, given 

southern and broader Africa’s market, 

receiving optimal liquidity is critical 

and is an important pillar within best 

execution. 

Analysing a trade’s market impact is 

also critical. Execution report analysis 

will offer insights into this factor. Lastly, 

treasurers must ask whether they 

received the best price. Typically, market 

participants rush toward just this factor, 

so analysing it is logical. 

Hutchinson’s point about quotes sitting 

on MDPs for far too long highlights 

how manual execution delivers less 

than optimal execution. For instance, 

most MDPs offer price refreshes four 

times per second. Assuming a manual 

quote takes 5 seconds to put together, 

clients are exposed to 20 price changes. 

“All of this pushed us to have more 

conversations with clients about 

different execution styles and what’s 

best suited for you,” Hutchinson says. 

“What do the differences between RFQ 

and Request for Stream (RFS) look like, 

and what is their impact on clients and 

their executions?” 

FIGURING OUT THE BEST FIT 

Getting a hold of all the factors 

corporates must look for in a bank 

partner can seem intimidating. 

Hutchinson has spoken about looking 

at internalisation rates in the past and 

encourages his clients to ask questions 

about them. 

He defines the internalisation rate as 

the percentage of risk a bank passively 

trades out with its other clients, 

with a higher rate indicating better 

performance. Notably, this definition 

doesn’t hold across each bank. 

These definition changes occur due to 

the diversity of liquidity providers banks 

access, all with different degrees of 

sophistication. Banks that seek to exit 

risk into the market tend to produce 

the highest market impact for clients, 

and looking for this quality is critical 

from a treasurer’s perspective. 

“Data is critical,” Hutchinson says. 

“Internalisation rates, price markouts 

of execution, holding times of trades 

for internalisation rates by deal and 

ticket sizes are a few data sets that are 

important.” 

He adds that the client’s willingness to 

work with the e-FX desk at their bank 

to design workflows fit for purpose 

is also important. There’s an entirely 

new dynamic in how the market now 

operates versus a few years back [in 

particular the Dollar/Rand market ], and 

clients will benefit from understanding 

how banks value client flow and what 

can be done so that both parties 

benefit.” 

Recently, algorithmic (algo) trading has 

emerged as a potential solution for 

illiquidity and reducing market impact. 

What does this picture look like in 

South Africa? 

“It’s in its infancy in the local market,” 

Hutchinson says. “Local banks haven’t 

brought much to the market for a few 

reasons. One, it is a big investment 

(even on a white labelled basis), and 

not every bank is at that stage of its 

journey to justify that cost.” 

“Illiquidity and choppiness in the 

Rand market are also a factor,” he 

adds. Treasurers are also not (as yet) 

fully versed with algo workflows, and 

this contributes to the low uptake. 

Hutchinson notes that with global 

banks setting up shop in South Africa, 

algo trading practices ought to expand 

more locally. 

HANDLING CENTRAL BANK 

COMPLIANCE 

Outside of South Africa there are 

additional challenges unique to the 

continent. Currently, the African 

banking landscape is a mix of regional 

players and Super Regional banks 

who operate local liquidity centres of 

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continuation of infrastructure 

development, and of course, local 

demand.” 


Clients will benefit from understanding how banks value client flow and what can be done so that both parties benefit 

Central banks tend to guide the 

markets based on their counterparty Hutchinson notes that banks 

liquidity transfer expectations. This have witnessed some interesting 

approach works well in a voice-driven developments, like rethinking the role 

and manual environment. Relationships of central pricing engines. While these 

with the central bank lead to a better engines deliver prices and maintain 

understanding of their expectations, spread guidelines to clients, can they be 

ensuring compliance. 

used to interact with central banks too? 

As banks increasingly pursue 

“I think what makes it challenging 

electronification this introduces an is the complexity behind these e-FX 

entirely new dynamic of how best mechanisms,” he says. “Identifying 

to ensure compliance. Hutchinson clients and identifying which central 

explains. “You’ll find (as an example) bank guidelines to apply to them, etc is 

a client who has a footprint across complicated and might result in some 

East and West Africa, may wish to breakage.” 

maintain a relationship with their bank 

across markets seeking to establish “It’s a really interesting dynamic in our 

consistency in operations . However, local market right now,” he continues, 

due to the dynamics unique to those “where we’re not trying to just 

markets or internal capability rollouts, optimise prices for clients, but also align 

you’ll find that service offerings aren’t with what central banks are looking for. 

very consistent across subsidiaries.” We have to make them comfortable 

that despite moving onto this digital 

He mentions that RMB has been platform that can sometimes run 

working to increase consistency across autonomously, we can maintain their 

multiple markets through its e-FX guidelines.” 

tooling. While better experiences are 

being created, this attempt has come Banks have a significant role to 

with certain challenges. “A lot of e-FX play here in terms of education. 

capabilities don’t naturally consider 360T’s Tolmay is bullish about 

elements such as central bank spread electronification’s growth prospects. 

guidelines, compliance with pre trade “Growth is expected from the more 

quote guidelines etc,” he says. “We’re mature markets on the continent,” 

being challenged as a market to think he says. “Drivers will include the 

about doing these things.” 

local regulatory environment, the 

While the markets in southern Africa 

have traditionally been more advanced, 

Tolmay says his attention is focused 

on other areas. “We expect continued 

expansion of electronic trading to 

continue in southern Africa where the 

FX markets have traditionally been 

more advanced. However, the uptake in 

both East and West Africa may prove to 

be key in the coming years.” 

Electronification can drive more 

transparency for central banks, giving 

them insights into customer demand. 

And with these insights come more 

demand for innovative products that 

offer transparency into different market 

functions. 

THE NDF PICTURE AND WHAT 

THE FUTURE HOLDS 

NDFs have traditionally received less 

demand in Africa. However, the NDF 

market is relatively young, with the 

first African NDF executed as recently 

as 2019 by Bank of America and Citi. 

Hutchinson says RMB has noticed a 

growth spurt in demand. 

“The appetite is coming from a few 

places, but where we definitely see 

demand coming from is the offshore 

buy side,” he says. RMB’s position as 

a super-regional bank and its work 

in expanding distribution has led to 

its presence in multiple offshore FX 

venues. As these FX venues moved 

towards NDF, demand has grown, 

Hutchinson says. “A lot of these 

venues have made significant strides 

in Asia and LATAM NDFs. Naturally, 

they’re looking for the next growth 

phase which they see as Africa. We 

are in the process of activating our 

NDF market making capabilities on 

these venues to compliment our very 

successful USDZAR cash market making 

capability.” 



He notes there are a few hurdles 

around regulations. For instance, US 

swap dealing regulations might lead 

some banks to build relationships with 

prime brokers to mitigate regulatory 

concerns. “We also see central clearing 

models that some venues are offering 

as an interesting way of accessing 

clients,” he says. 

Hutchinson believes the NDF market 

is set to grow and is bullish about 

African e-FX’s potential in the near 

term. “Client conversations have 

shifted toward increasing efficiency 

and electronification is a part of 

that,” he says. “On an RMB level, 

I’m excited because we’ve been on 

this journey for a while now and the 

benefit it has for our next level of 

innovation.” 

With more data and robust processes 

in place, banks can hope to engage 

more with markets and central banks. 

Electronification may lag in African 

e-FX, but it is nonetheless creating a 

rosy future for market participants. 

FINTECH INCREASINGLY MAKES 

IT MARK ON THE INSTITUTIONAL 

SPACE 

Fintech’s focus on Africa has largely been on payments. 

Specifically, cross-border payments have benefited from 

the injection of technology that fintechs have brought 

to the market. The institutional picture extended this 

advantage, giving clients access to wholesale FX rates 

and payment platforms. 

salesperson operating on behalf of a client using a voice 

channel or a client seeking to self-service on a digital 

platform, we want to preserve the level of pre-trade 

checks needed.” 

Traditionally banks have codified these checks in their 

pricing engines, leading to a rigid structure incompatible 

with modern markets. RMB has been working with 

fintech providers to create modular and flexible rules 

engines that ensure prices delivered to clients are up to 

date and in line with compliance needs. 

“We have been working with them to rethink our 

approach and processes in FX, but are also beginning 

to explore it in a cross-asset way (in particular Fixed 

Income),” Hutchinson says. “I think one of the hallmarks 

of the new world we find ourselves in is the concept of 

loosely coupled architecture. Older models were tightly 

coupled and created an oil tanker that couldn’t move.” 

As subsea cables from Meta and Google continue to 

boost digital adoption, the institutional fintech scene 

is witnessing interesting developments. “Africa’s young 

population has more access to technology than ever 

before,” 360T’s Tolmay says. “This is resulting in greater 

tech literacy making them more inclined to adopt digital 

services from banks. Digital FX services form part of a 

greater client offering that banks are in a race to provide 

their clients.” 

RMB’s Hutchinson details an interesting use case 

involving pre-trade rules engines. “One of my focuses 

at RMB has been delivering higher consistency in our 

direct-to-customer services,” he says. “Whether it’s a 

“The ability to connect to a third party service by API is a 

powerful piece of how we’re thinking of our architecture,” 

he says. When asked about how fintech fits into this 

puzzle, given its lack of knowledge about internal 

processes and compliance needs, Hutchinson explains that 

fintech is a part of the workflow, not all of it. 

“We’ve configured our rules and connected everything 

to our pricing engine,” he says. “We can then send 

a call to this third party engine that delivers a yes/no 

decision based on the conditions we’ve given it. This has 

been a powerful move for us and this is how we see our 

pre-trade rules working.” 

This move from a B2C orientation to an institutional one 

is highly encouraging in fintech circles. As technology 

adoption increases in the buy and sell side, fintech will 

likely make stronger appearances, leading to even more 

interesting use cases. 


CBP: A versatile and powerful 

platform to deliver FX and 

payments solutions 

We asked Chris Gibson, Director of Payments at smartTrade Technologies, 

to tell us more about his firm’s new class-leading FX and payments 

platform. 


Chris Gibson 

Who are you targeting with 

Commercial Banking & Payments 

(CBP) and is likely to benefit most 

from deploying it? 

Of course, the name Commercial 

Banking & Payments suggests the 

most prominent target audience for 

the platform: financial institutions 

providing cross-border payments with 

FX to business clients. However, the 

strength of CBP goes beyond this 

single–albeit crucial–use case: it is 

an unrivaled FX distribution platform 

that allows banks to source, price, 

and distribute FX into any channel 

for any audience and need. Any bank 

or institution with a significant FX 

distribution franchise–whether they 

have sophisticated trading needs or 

not–can benefit from CBP. 

CBP unites FX and Payments 

capabilities in a single, powerful 

platform covering the entire FX 

and payments lifecycle. What are 

the advantages of doing that? 

Most FX clients today don’t have 

access to a platform that can provide 

adequate FX capabilities alongside 

the cash management and payments 

features that normally give rise to FX 

needs. This forces clients to spread 

their transactions across platforms and 

providers or to simply choose lesser FX 

solutions–or even none at all because 

the costs and risks of piecing together 

transactions across multiple venues 

are too high. Breaking what most 

clients see as a single transaction into 

multiple parts is both a loss of volume 

and an invitation to attrition. A single 

platform gives clients the experience 

they expect and banks the ability to 

deliver that experience efficiently and 

effectively. 

What key features and 

functionality does CBP offer? 

CBP covers the entire FX lifecycle 

from liquidity to aggregation, pricing 

and distribution. Banks can offer a 

full range of currencies, transactions, 

and execution types to internal 

(voice and electronic) and external 

audiences with tailored pricing. Users 

can settle and fund FX transactions 

via any payment type and choose 

split, bulk, or post-dated payments. 

Cash management features include 

user roles, confirmations, netting, 

templates, and payment and 

instruction approvals. Controls include 

credit and deposit checks, risk and 

settlement limits, bank approval 

workflows, field validations and a 

range of other features that ensure 

transaction and platform integrity. 

In addition, CBP is fully ISO-20022 

compliant and can not only operate 

in both MX and MT formats but it 

can facilitate the transition to ISO 

compliance. 

How have you designed the 

platform to make it more intuitive 

and easy to use for clients and 

their staff? 

A key challenge for platforms 

incorporating payments and FX is 

enabling users to transact on familiar 

terms whether those terms are 

payments, FX, simple, or complex. CBP 

provides FX, payments, and combined 

workflows for straightforward to 

sophisticated users within a single 

interface. Banks can not only provide a 

natural payments or FX experience to 

their clients but they can also graduate 

those users to more sophisticated 

and higher-value transactions and 



CBP Client Web with FX and Payments functionality for a sophisticated Commercial client 

deepen engagement with the bank. 

With Settlement Streaming, users can 

enter into transactions from either a 

settlement or FX perspective–whatever 

is more comfortable for them. 

How much flexibility does the 

platform provide for users who 

may have differing requirements? 

For example in dealing with 

multiple audiences or wanting to 

choose their own FX and Payments 

processing partners. 

The CBP platform is happily 

agnostic about liquidity sources, 

correspondents, and payment types. 

This allows a bank to assemble any 

combination of these and plug them 

into CBP to deliver the desired client 

experience. CBP’s smart routing 

capabilities allow it to select FX 

liquidity and deliver payments to 

particular providers based on a variety 

of criteria from currency, destination, 

transaction amount, or even payment 

cost. 

In a similar vein, CBP can serve 

different transactions, pricing, 

currencies, languages, and experiences 

to different customer types, 

geographies, languages, and even 

individual users. This allows a bank to 

provide a tailored FX and payments 

experience to multiple and different 

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LMAX GLOBAL: 

Talking about a market leading firm that’s 

building an increasingly successful and 

diversified offering 

THE E-FOREX INTERVIEW 

Andreas Wigström 


THE e-FOREX INTERVIEW 

LMAX Group is a leading independent operator of multiple execution venues for FX and digital 

assets trading. e-Forex spoke to Andreas Wigström, Managing Director of LMAX Global, the 

company’s regulated broker, which offers retail brokers and professional traders around the 

world access to trade over 100 instruments including FX, metals, equity indices, commodities 

and crypto CFDs. 

Andreas, you joined LMAX Group 

in 2010 and are now Managing 

Director of LMAX Global. Please 

remind us how LMAX Global fits 

into the overall LMAX Group 

structure and the range of 

products and services each part of 

the business provides. 

LMAX Group is unique in offering fair 

and transparent global market access 

to all institutional customer segments, 

including banks, non-banks, the 

buy-side, and retail brokers. We have 

over 250 people working within the 

business across 11 offices worldwide 

and are continuously growing and 

expanding the business. We have 

a solid presence in all the major FX 

markets around the world, including 

Europe, North America, and Asia 

Pacific. 

Our rapidly expanding global 

institutional and professional client 

base is a testament to our distinctive, 

integrated business model, which 

delivers efficient market structure 

and transparent, precise, consistent 

execution to all market participants. 

Our business consists of three core 

entities: LMAX Exchange, which 

operates institutional FX exchanges, 

an FCA regulated MTF, and a MAS 

regulated RMO, LMAX Digital, a GFSC 

regulated institutional spot crypto 

currency exchange and custodian, and 

LMAX Global, which I lead, an FCA 

and CySec regulated broker for FX, 

metals, and commodities worldwide. 

What do your day-to-day 

responsibilities usually involve? 

I’m responsible for managing our 

teams around the world driving 

growth, expansion and overseeing 

sales coverage globally for LMAX 

Global. We operate FX brokers in the 

UK, Europe, and New Zealand and 

with liquidity pools in London, New 

York, Tokyo, and Singapore - it is a truly 

global role and requires me to conduct 

business at any time, on any given day. 

We have a solid presence in all the major FX markets around the world, including Europe, North America, and Asia Pacific 


LMAX Global: Talking about a market leading firm that’s building an increasingly successful and diversified offering 


I spend a substantial portion of my 

time on the road, meeting with our 

clients to really understand their needs 

in terms of product demand. The 

beauty of our integrated exchangebroker 

model allows us to offer 

solutions to our clients according 

to their trading requirements. It’s 

an embodiment of our belief in fair 

market access for all, regardless of size, 

geography, or trading volume. 

As a team, we also participate in 

industry expos and events that bring 

together the key market participants 

including liquidity providers, banks, 

and regulators. 

Can you please tell us more about 

your integrated exchange-broker 

model and the types of clients you 

are providing for? 

Our integrated exchange-broker 

model offers LMAX Global clients 

access to trade on LMAX Exchange 

central limit order book and peer-topeer 

institutional liquidity. Enabling 

transparent price discovery and 

precise, consistent execution with no 

‘last look’ rejections.. Those global 

clients include broker dealers, money 

managers, MT4/5 brokers, and 

professional traders. 

It’s an institutional grade experience 

for clients that may not have previously 

has institutional grade access to 

the FX market. Similarly, in 2018 

we established LMAX Digital, our 

institutional crypto currency exchange 

in response to demand from clients 

for an institutional-grade experience 

in the digital assets market. Through 

this model, LMAX Global clients can 

seamlessly trade both spot FX and spot 

crypto currencies through the same 

trusted partner. 

Our clients have access to our global 

liquidity pools in London, New York, 

Tokyo, and Singapore and can trade 

over 100 instruments across FX, 

metals, equity indices, commodities 

and crypto CFDs. 

What makes LMAX Global 

different from many other firms 

operating in this market and its 

value proposition so attractive 

and unique? What are the key 

advantages of your central limit 

order book model? 

LMAX Global delivers the unique 

benefits of exchange quality execution, 

transparent price discovery and a 

level playing field for all brokers and 

professional traders. 

For brokers, money managers and 

professional traders, a central limit 

order book (CLOB) model offers 

streaming firm limit order liquidity 

from top tier banks and non-bank 

institutions, transparent price discovery 

and no ‘last look’ rejections, giving 

institutions full transparency of market 

dynamics and control over their 

execution strategy and costs. 

Our success reflects the genuine shift 

that the industry has undergone. 

We offer a unique integrated exchange-broker model which allows us to serve clients exactly where their needs are 



Our clients have access to our global liquidity pools and can trade over 100 instruments across FX, metals, equity indices, commodities and crypto CFDs 

Clients from all FX market segments 

are trading increasingly more on orderdriven 

firm liquidity and requiring 

transparent, precise, and consistent 

execution. 

LMAX Group has always been well 

known for its marketing leading 

proprietary technology. How 

important is technology for your 

side of the business and how do 

you go about sourcing, operating, 

and leveraging it? 

From the outset, we knew that the 

only way to deliver precise, consistent, 

and reliable performance on our 

exchanges was to take a proprietary 

approach and build all our ultra-highperformance 

technology ourselves. 

This technology allows us to deliver 

an exceptional client experience 

24/7, but also means we can bring 

new innovations to the market and 

build new functionality quickly and 

seamlessly. 

We continuously focus our expertise 

on refining and improving all aspects 

of our technology. Our revolutionary 

and minimalist approach to 

architecture and technology-related 

processes are a careful blend of inhouse 

intellectual property and the 

most up-to-date best practice, with 

one aim in mind – optimised execution 

quality with superior ultra-low latency. 

In the past you have talked about 

not just offering better access and 

creating a level playing field for all 

participants but also changing the 

shape of that playing field. What 

did you mean by that? 

We offer an institutional-grade experience for clients that may not have previously had institutional-grade access 

to the FX market 

Our mission is to Build Fairer Markets 

for all and the leading cross-asset 

marketplace - something that we work 

towards and stand by daily within the 

business. Fairer markets are about 

creating more efficient markets with 



unlocking exciting possibilities. LMAX 

Group is well placed to take advantage 

of these opportunities. 

Who are the key members of 

your executive team and what 

roles do they each play within the 

company? 

We have a brilliant pool of talent 

within LMAX Group, and subsequently 

within LMAX Global. 


We continuously focus our expertise on refining and improving all aspects of our technology 

access for all and that means not only solutions and believe that blockchain 

levelling out the playing field but also technology will form the backbone 

changing the shape of the playing of the capital markets of the future, 

field too. This involves breaking down solving many of the challenges 

previous industry conventions, setting experienced today. For example, 

improved standards and bringing new blockchain technology provides an 

practices to the market that better immutable and auditable record of 

serve the needs of our clients across transactions, eliminating the need for 

geographies and market segments. intermediaries to verify and reconcile 

records. This transparency reduces 

Challenging convention and counterparty risk and enhances market 

constantly looking for innovation integrity. 

seem to be part of the DNA 

of LMAX Group. What would The automation and efficiency offered 

you like to see to improve the by this technology has the potential to 

current structure and operating streamline capital markets processes. 

characteristics of the markets in Smart contracts automate the execution 

which you are doing business? of agreements, reducing manual errors 

and operational costs. As a result, 

LMAX Group is one of the few 

capital market participants can enjoy 

companies in the market which is lower fees, faster liquidity, and improved 

bilingual and excels in both traditional operational efficiency, driving growth. 

trading, credit, and settlement and 

blockchain. We are leveraging our The convergence of traditional finance 

footprint in traditional finance and and DeFi presents immense potential 

tokenisation to educate and create for the future of capital markets, 

I am supported day-to-day by 

our compliance, client services, 

operations, and regional sales teams. 

Critical to the business are also 

several technology specialists and 

developers who are continuously 

refining and improving all aspects 

of our technology and exchange 

infrastructure. 

Within LMAX Group we have a very 

adaptable and agile global team, and 

therefore access to pools of talent and 

expertise across the broader business 

functions as required, depending on 

our client needs. 

What is the LMAX Global team 

currently doing to explore and 

develop new products and services 

to cater for the evolving needs of 

your clients? 

We are part of a regulated business 

which has a unique proposition 

enabled by our robust scalable 

technology and global exchange 

footprint. Our unique exchange-broker 

integrated business model allows us 

to service clients across all market 

segments and offer them opportunities 

to trade in both traditional and digital 

assets, through the combination of our 

LMAX Exchange, LMAX Digital and 

broker businesses. That’s a powerful 

combination. 

Most recently, we received our 

Recognised Market Operator (RMO) 



Licence from the Monetary Authority 

of Singapore enabling LMAX Exchange 

to offer Non-Deliverable Forward (NDF) 

trading in Singapore and London. We 

are building an increasingly diversified 

offering in Asia Pacific to support 

growing demand from institutional 

investors operating in the region. 

We see significant potential to develop 

our global footprint, especially as the 

convergence between crypto and 

traditional capital markets continues 

apace. Ultimately, we see a major 

opportunity to offer FX and crypto 

trading via one exchange – we 

continuously look to rethink market 

structures and challenge the status 

quo. 

You have a great deal of 

experience in Asia having 

previously helped to drive the 

business growth of LMAX Group 

across that region. How important 

will this part of world be for LMAX 

Global over the next few years? 

The APAC region is particularly 

important for the growth of LMAX 

Global. We’ve been operating a local 

exchange in Tokyo since 2014. We 

have a fantastic institutional clientbase 

made up of Tier 1 brokers, 

local banks, and proprietary trading 

firms and increasingly we’re seeing 

participation from global as well as 

local institutions. 

For brokers, money managers and professional traders, a central limit order book (CLOB) model offers many 

advantages 

What do you enjoy most about 

the work you do and the office 

environment? 

As an independent exchange operator, 

we’re able to innovate, optimise and 

roll-out new products more efficiently 

to serve our global institutional and 

professional client base across the 

Group. It also helps to be surrounded 

by super smart people who like 

to challenge convention and are 

We opened our regional hub in 

Singapore in June 2015 and set-up 

our matching engine there in 2022 

which has gained significant traction 

locally and has a strong pipeline of 

institutional customers looking to 

onboard adding significant value for 

the local financial eco-system. We see 

further potential to enhance market 

access to this institutional liquidity by 

establishing an Asia Pacific corridor 

between our twin hubs in Tokyo (TY3) 

and Singapore (SG1). 

We are of the opinion that market data is becoming increasingly important within the industry 



constantly exploring innovation. That’s 

very much the case at LMAX Group. 

In terms of our environment, we’ve 

just recently completely renovated 

our offices in London, New York, and 

Singapore, unveiling collaborative 

spaces that better reflect the business 

we are today. It has refreshed our 

behaviors, mindset and energy and 

we’re ready to take on the years 

ahead. 

What are going to be your 

priorities this year as you and your 

team work to grow the business 

further and maintain its market 

leading position? 


We’ve just recently completely renovated our offices in London, New York, and Singapore 

We continue to invest in our 

distribution capabilities and 

infrastructure globally and deepen our 

client relationships across the globe. 

Our ongoing technology investment 

has ensured resilience, security, and 

increased capacity of our exchanges. 

We are of the opinion that market data 

is becoming increasingly important 

within the industry, as businesses such 

as ours and the other major players 

in the market seek to capitalise on 

its availability and potential. The fact 

that we gather firm liquidity market 

data from all client segments, often 

not accessible through primary 

venues, puts us in a differentiated and 

advantageous position compared to 

others. 

Our ability to provide true price 

discovery and liquidity from all market 

segments means that we can capture 

greater insights that help our clients. 

The Group is well positioned to lead 

in both FX and digital assets due 

to our unique and complementary 

triangulation of brands, enabling us to 

overcome industry infrastructure gaps 

and cross-sell to our global institutional 

client base. 



WE SEE SIGNIFICANT 

POTENTIAL TO DEVELOP 

OUR GLOBAL FOOTPRINT, 

ESPECIALLY AS THE 

CONVERGENCE BETWEEN 

CRYPTO AND TRADITIONAL 

CAPITAL MARKETS 

CONTINUES APACE 


NDFs: The market looks 

towards increasing 

electronification to meet 

rising demand 

As the demand for NDFs continue to surge, Nicholas Pratt examines 

the role of electronic trading and technology to meet this 





Nicholas Pratt 

The NDF market enjoyed a huge surge 

in demand between 2016 and 2019 

when, according to the BIS Triennial 

Survey of 2019, average daily volumes 

more than doubled, from $127 billion 

to $258 billion. The acceleration slowed 

somewhat in the BIS survey of 2022 

with average daily volumes reaching 

$266 billion. 

Yet demand remains high, particularly 

in emerging markets, driven by a 

confluence of factors. Chief among 

these is the ongoing globalisation of 

financial markets as investors allocate 

more assets to emerging markets in the 

face of slowing economies in developed 

markets. This has fueled the need for 

hedging against currency risk, within 

which NDFs can play a critical role. 

The electronification of local market 

makers has also helped to meet the 

demand for NDF trading by increasing 

the access to NDF pricing and reliable 

sources of liquidity, as have some 

regulatory tailwinds that have helped 

to promote a more diverse market 

for product development. But more 

investment in electronic trading services 

will be needed if the NDF market is to 

reach its potential. 

Due to differences in FX volatility 

between developed and emerging 

markets, asset owners are often 

reallocating risk to EM countries. And 

because many of the currencies in 

these countries are still non-convertible, 

the typical way for offshore investors to 

trade in those markets is via NDFs. “Asia 

in particular accounts for four of the 

top five traded NDF currencies globally 

based on the BIS survey including large 

manufacturing-based economies like 

China, South Korea and India,” says 

Oleg Shevelenko, FX Product Manager 

at Bloomberg. 

While NDF markets are typically used to 

hedge FX exposures often linked to fixed 

income holdings, speculative trading 

is also on the rise, says Shevelenko, 

which is generally a reflection of 

market growth and sophistication. 

“In most cases, NDFs have higher 

volumes than their deliverable onshore 

currency equivalents due to a wider 

group of market participants and 

recent technological advances in the 

NDF markets such as locally hosted 

order books and the rise of algorithmic 

trading,” says Shevelenko. “The fact 

that the NDF market is a part of global 

derivatives reform and as such is subject 

to clear regulatory trading and reporting 

standards removes various regulatory 

concerns and opens wider investment 

opportunities.” 


NDFs: The market looks towards increasing electronification to meet rising demand 

“As we learned from the spot market, the introduction of algo 

execution itself brings efficiency, consistency of pricing, and 

standardization to the market which creates a ripple effect for 

further algo adoption. We are starting to observe the same 

with NDFs,” 

asset and take additional execution 

responsibilities, voice execution ceases 

to be a viable option due to the time it 

takes to analyse, execute and book the 

trade.” 

While NDF algos are being offered 


Oleg Shevelenko 

NEW ELECTRONIC SERVICES 

As a consequence of the surging NDF 

demand, FX providers are launching 

new electronic trading and clearing 

services for these instruments. In 2023, 

FXGO, Bloomberg’s multibank FX 

trading platform, launched a regional 

hosting service in Singapore for its 

Asia Pacific clients designed to improve 

transparency and pricing for local 

markets. FXGO also hosts a number 

of regional banks’ algos. “Despite 

the absence of a clearing mandate, a 

proportion of NDFs is being centrally 

cleared,” says Shevelenko. “This helps 

reduce the cost of capital, counterparty 

risk and improves market efficiency, 

contributing to the overall growth of 

NDFs.” 

There has also been some work done 

to improve the fragile liquidity of the 

NDF market, says Shevelenko. “Industry 

surveys continue to highlight that NDF 

turnover in aggregate is on the rise. 

For example, the Bank of England 

reported record highs for NDF turnover 

in its latest semi-annual FX turnover 

survey, with a 4% increase. However, 

the paths of each NDF currency are 

very different. Some emerging market 

countries embrace and support the 

growth of their existing NDF markets 

allowing local investors to participate 

directly or indirectly, while the others 

carefully regulate and restrict access to 

it. In addition, the internationalization 

of China’s renminbi resulted in the 

rapid growth of the deliverable forward 

CNH market as an alternative to NDFs. 

FXGO deployed its trade negotiations 

and analytics tools in various emerging 

markets to help participants optimize 

access to both onshore and NDF 

liquidity via RFQ, auctions, streaming, 

central limit order book and algorithmic 

orders.” 

There is still more work to be done 

though, says Shevelenko. “Although 

still in early stages, in many regards 

the path to the electronification of 

NDFs resembles the one for FX spot. 

Leading market makers and electronic 

trading platforms started with 

electronic pricing of NDFs which in turn 

enabled automated hedging and risk 

management. As automated hedging 

is a key operational requirement for 

algorithms, market makers are now 

able to offer basic NDF algos to their 

clients to leverage.” 

Despite those recent advances, many 

NDF markets still operate on a very 

thin liquidity especially outside of local 

market hours, says Shevelenko. “Due 

to the bilateral nature of FX markets, 

participants don’t always have access to 

the local liquidity providers, especially 

as NDFs are derivatives compared to 

spot. A more widespread adoption 

of FX clearing is likely to bring more 

market participants together and 

facilitate further market growth. Finally, 

as buy-side desks are becoming multi- 

by the major liquidity providers and 

being actively evaluated by the buyside, 

there are still several challenges 

prior to meaningful adoption, says 

Shevelenko. “For example, the number 

of venues offering electronic trading 

of NDFs is still limited. Liquidity is 

inconsistent and nuanced across NDF 

pairs. Algorithms themselves are not 

as proven and well-defined as for spot. 

Some buy-side firms don’t have reliable 

access to market data to trigger the 

algo. On the bright side, as we learned 

from the spot market, the introduction 

of algo execution itself brings 

efficiency, consistency of pricing, and 

standardization to the market which 

creates a ripple effect for further algo 

adoption. We are starting to observe 

the same with NDFs.” 

And what of the future growth 

prospects for NDFs? “Due to the 

rapid growth of various emerging 

market economies, asset managers 

are likely to continue to increase their 

asset allocation in respective markets 

which will drive the usage of NDFs as 

a hedging tool,” says Shevelenko. “In 

response, electronic trading capabilities 

of NDFs including trading on regulated 

venues (SEFs and MTFs), accessing 

streaming liquidity and the usage of 

NDF algos will continue to evolve. 

The industry will need to settle on 

the clearing debate which will largely 

depend on whether the FX clearing 

framework can be expanded beyond 

NDFs. Finally, bank and non-bank 

liquidity providers as well as multi-bank 

venues would need to work together 

on standardizing access to liquidity, 

workflows and post-trade clearing and 

settlement practices to match what is 

currently available in FX spot.” 


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“As technology continues to evolve, onshore participation 

will continue to improve, utilizing tools and infrastructure 

to seamlessly engage in NDF trading, enhancing market 

accessibility, liquidity and transparency,” 

Brian Andreyko 

SOLUTIONS TAILORED TO NDFS 

As the demand for NDFs undergoes 

rapid upswing in adoption, due in part 

to large swings in country interest rate 

differentials, leading FX providers are 

strategically responding by introducing 

innovative electronic trading products 

and clearing services, tailored 

specifically for these instruments. 

“At Edgewater, we have been 

providing solutions to onshore 

institutions that enable them to 

embrace electronification and scale 

their operations to meet the growing 

global demand for NDFs,” says Brian 

Andreyko, chief product officer at 

Edgewater Markets, the US-based 

FX trading technology provider. “By 

offering electronic trading platforms 

and tools, onshore institutions can not 

only compete, but thrive in servicing 

the global marketplace. This enhances 

overall market efficiency while reducing 

operational complexities. This increases 

profitability of onshore participants 

and adds a new and expanded global 

client base, capitalizing on datadriven 

optimized trading. This strategic 

approach aligns with the broader trend 

of technology-driven transformations 

of other financial markets, compressing 

spreads and costs for clients, and 

matching global client interest with 

onshore market inventory.” 

But in emerging markets, technology 

is not enough, he says. “Leading FX 

providers are also introducing credit 

intermediation services that cater 

to global distribution. Edgewater 

recognizes the global nature of NDF 

trading, and the diverse array of 

participants and counties involved. 

Offering credit intermediation solutions 

that broaden trading relationship 

become paramount, particularly in 

To facilitate further electronification we would need larger adoption of e-FX solutions from tier 2/3 banks in 

emerging markets 

emerging markets where credit is 

restrictive. For example, at Edgewater, 

through a single credit clearing 

relationship with one of our global 

Prime Brokers, we connect our clients 

to multiple onshore participants in 

multiple countries, eliminating the 

need for global participants to set 

up hundreds of ISDAs with individual 

onshore providers. Bridging the credit 

gap between Edgewater’s clients 

and onshore liquidity partners has 

significantly enhanced overall liquidity 

and accessibility of NDF markets.” 

A significant role played by service 

providers involves credit intermediation, 

says Andreyko. “By leveraging the 

services of third-party intermediaries, 

market participants can access a 

broader pool of liquidity providers. 

This approach helps alleviate liquidity 

constraints by connecting buyers with 

an array of sellers, fostering a more 

dynamic, interconnected, and efficient 

marketplace. Edgewater’s credit 

intermediation services are one of the 

most robust and compelling parts of 

our offering that enhances NDF trading 

for all participants involved.” 

Furthermore, there has been a strategic 

shift in bank workflows to capitalize on 

increasing global market demand, says 

Andreyko. “This adaptation involves 

optimizing internal bank processes 

that allow them to scale and better 

service not only their existing onshore 

business, but global NDF demand 

as well. By aligning workflows with 

credit resources, market participants 

direct flows to those that specialize 

in a particular currency, fostering 

a more stable and resilient trading 

environment. At Edgewater, our 

liquidity partners tell us often how 

transformative their business has 

become with our global distribution 

abilities comingled with our credit 

intermediation and technology 

services.” 





To facilitate further electronification, 

there is a need for continued 

development and adoption of various 

trading methodologies alongside global 

connectivity solutions that match 

onshore and offshore participants, says 

Andreyko. “Specifically, our clients are 

looking for solutions that address larger 

trade sizes with the efficiency that 

electronification offers. To provide this, 

Edgewater has recently implemented 

anonymous Request for Quote (RFQ) 

trading, incorporating technology that 

emulates voice driven markets while 

providing the efficiency and scale of 

electronic trading. This development 

has expanded trade flow, allowing 

firms to source competitive pricing and 

execute trades more efficiently and cost 

effectively, eliminating middlemen. This 

interaction is instrumental in building 

trust among market participants, 

ultimately fostering increased 

participation and liquidity.” 

One notable challenge of delivering 

NDF algos is the requirement for the 

algo to interact with liquidity providers 

that have deep enough books of 

business to warehouse the transaction 

flow, says Andreyko. “To address this 

challenge, collaboration with onshore 

banks becomes crucial. Onshore banks, 

equipped with warehouse capabilities 

broadened by their onshore flow, 

can play a pivotal role in improving 

NDF algo performance that has been 

lacking. By leveraging electronic access 

and risk management expertise of 

onshore banks, NDF algorithms can 

expand their scope and effectiveness, 

while reducing market impact, 

an inherent risk associated with 

algorithmic trading performance,” he 

says. 

The future outlook is promising, with 

several factors contributing to NDFs 

continued expansion, says Andreyko. 

“The continued development in arming 

onshore participants with technology 

to participate in global markets is 

paramount. As technology continues 

to evolve, onshore participation will 

continue to expand and improve, 

utilizing tools and infrastructure to 

seamlessly engage in NDF trading, 

enhancing market accessibility, 

liquidity and transparency. This will 

significantly contribute to the overall 

growth and vibrancy of NDF markets, 

providing geographical diversification 

that unlocks new opportunities for 

participants, further fuelling the growth 

of NDFs on a global scale.” 

Additionally, the provision of credit 

intermediation services that enable 

onshore participants to participate in 

global markets is a crucial component, 

says Andreyko. “By facilitating secure 

and efficient global distribution and 

credit intermediation services, we 

bridge the gap between onshore 

and offshore markets. This not only 

enhances market inclusivity but 

also encourages a diverse range of 

participants to engage in NDF trading, 

further amplifying market liquidity and 

activity. Lastly, one significant trend 

is the ongoing discussions in many 

markets, including India, Korea, and 

Chile, regarding the eventual opening 

up of their currencies. The potential 

maturation of these new markets will 

first go through a robust period of NDF 

trading as these markets begin that 

transition.” 

IMPROVING LIQUIDITY 

The adoption of electronic trading 

platforms has played a significant 

role in improving liquidity in NDF 

markets, says Andrea Sanna, head of 

liquidity management at London-based 

institutional FX broker Alp Financial. 

“These platforms offer transparency, 

efficiency, and accessibility, attracting 

a broader range of participants. 

Moreover, regulatory authorities have 

been active in addressing liquidity 

issues and any regulatory barriers that 

hinder market liquidity,” says Sanna. 

“The increased capabilities of e-FX 

trading systems nowadays allow for 

much more advanced and tailored 

liquidity offerings. Current technology 

can handle with no difficulty pricing in 

NDFs according to several workflows 

such as RFQ, RFS, or Streaming to 

accommodate customer needs. 

THE ELECTRONIC 

TRADING CAPABILITIES 

OF NDFS INCLUDING 

TRADING ON 

REGULATED VENUES 

WILL CONTINUE TO 

EVOLVE 

Liquidity providers, both brokers and 

market makers, are adapting swiftly to 

structure their pricing models to this 

market that in the new future will see 

an increasing spillover effect from voice 

to electronic trading,” says Sanna. 

“Similarly, to what was observed 

in recent years in full amount autopricing 

the tendency to auto-price and 

auto-hedge risk coming from NDFs 

will gradually extend to tickets larger 

in size and to products that result less 

liquid as soon as models and liquidity 


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“The evolving landscape, influenced by factors such as 

ESG considerations, economic trends, and integration with 

traditional FX markets, will shape the trajectory of NDF 

markets, requiring ongoing collaboration among stakeholders 

for a resilient and efficient future.” 

Andrea Sanna 

pools migrate towards electronic 

marketplaces,” says Sanna. “The clarity 

of the regulatory environment plays 

a pivotal role in allowing brokers and 

market makers to get the necessary 

confidence to price more extensively 

NDFs on an electronic fashion. 

However, at AlpFin we do think that the 

process already started, we can see that 

with respect to Asian NDFs, and this 

tendency will extend gradually to other 

regions.” 

Facilitating further electronification 

within NDF markets involves 

addressing challenges such as market 

fragmentation, liquidity concerns, 

and regulatory considerations, says 

Sanna. “Improvements in technology 

infrastructure, standardized clearing 

processes, and enhanced market 

structures are key to fostering 

electronification. Achieving these 

improvements will create a more 

efficient environment for trading 

firms to thrive in electronic trading. 

To facilitate further electronification 

we would need larger adoption of 

e-FX Solutions from tier 2/3 banks in 

emerging markets; increased clarity 

on the regulatory front with respect 

to NDF products; and reduced capital 

and margin requirements for customers 

and LPs willing to trade these products. 

The improvement of these points 

will initiate a virtuous circle that will 

naturally bring improved liquidity, 

lower spreads, larger volumes, and 

standardized and less VaR intensive risk 

management protocols.” 

There are challenges involved in 

delivering more electronification to 

the NDF market though, says Sanna, 

especially when it comes to NDFspecific 

algos. “Although algos are 

a prerogative of banks and venues, 

one of the main challenges to offer 

algos in NDF is connectivity to end 

customers that would like to use them 

either via GUI or API. At the moment, 

the customers that would like to use 

this service either don’t have an e-FX 

Solution or they don’t have enough 

credit standing to get a prime broker 

that allows them to connect to Tier 1 or 

Tier 2 liquidity providers,” says Sanna. 

“Delivering NDF algos presents diverse 

challenges, including liquidity concerns, 

market fragmentation, volatility, data 

quality issues, regulatory compliance, 

and technological infrastructure 

limitations. To address these challenges, 

NDF algorithms are designed with 

features such as intelligent liquidity 

sourcing, risk management strategies, 

data processing capabilities, and 

compliance checks. Technological 

advancements will contribute to 

algorithmic adaptability to changing 

market conditions, and continuous 

collaboration among quantitative 

analysts, technologists, and 

compliance professionals is essential 

for the successful deployment of NDF 

algorithms,” says Sanna. 

The future of NDFs is poised for 

growth with potential developments 

in regulatory frameworks, trading 

technology, and market dynamics, says 

Sanna. He points to four developments 

that would help the NDF market grow 

further. 

• Larger adoption of e-FX solutions 

from tier 2/3 banks and buy-side takers 

and providers in the Sub-Saharan 

region together with Latin America 

• Clarification of the MiFID 

requirements for brokers to operate in 

the NDF space in emerging countries 

• Increased presence of venues that do 

offer streaming liquidity pools in South 

American and African NDFs 

• Increased liquidity that will underpin 

a decrease in clearing costs and reduce 

spreads. 

“The evolving landscape, influenced 

by factors such as ESG considerations, 

economic trends, and integration 

with traditional FX markets, will 

shape the trajectory of NDF markets, 

requiring ongoing collaboration among 

stakeholders for a resilient and efficient 

future,” adds Sanna. 

REGULATORY DRIVERS AND 

RELIABLE DATA 

Historically, the fragility of the NDF 

market is due to a lack of depth of 

liquidity in the market which can 

create gaps in directional trading, says 

Wyman Shing, sales director APAC at 

Euronext FX. “Also, there has been a 

lack of reliable market data to inform 

participants. Liquidity providers cannot 

price without knowing where the 

market is.” 

Regulators have also taken several steps 

to improve the fragility of NDF liquidity 

environment, says Shing. “Regulators 

have implemented capital and margin 

requirements to reduce counterparty risk 

and encourage more liquidity. They have 

also implemented a range of measures 

to encourage more transparency in the 

NDF market, such as the introduction 


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“As more financial institutions adopt electronic trading 

systems, the market for NDFs will become even more efficient 

and liquid, allowing for more competitive pricing and faster 

transactions,” 

Wyman Shing 

of standardized contracts and reporting 

requirements for trades. And they have 

worked to implement new regulatory 

frameworks to ensure a more stable 

and transparent environment for NDF 

trading.” 

In addition to regulatory action, the 

market itself has also adjusted and 

innovated to face the liquidity challenges 

in the NDF market, says Shing. “Market 

participants have developed a range of 

solutions to enhance liquidity in the NDF 

market. These include the introduction 

of a central limit order book and the 

use of algorithms to match buy and 

sell orders. Banks and other financial 

institutions have increased their presence 

in the NDF market by providing liquidity 

through their own trading desks. Market 

participants have also established several 

electronic trading platforms to facilitate 

trading in NDFs. These platforms provide 

access to a range of NDF currencies 

and have also reduced transaction 

costs. ECNs such as Euronext Markets 

Singapore have increased and improved 

access to quality liquidity at high speeds 

and increased transparency via more 

reliable market data. And local liquidity 

providers with access to uncorrelated 

flow have advanced their technology 

and now can participate in electronic 

markets directly.” 

WORK TO BE DONE 

In terms of what needs to be done 

to ensure further electronification of 

the NDF markets, Shing highlights five 

measures – increased automation, 

regulatory pressures, the need for 

cost savings, improved liquidity and 

improved access to data. “Automation 

has been a major factor in driving the 

further electronification of NDF markets. 

Automated trading systems have 

allowed trading firms to execute trades, 

reducing market impact and improving 

liquidity quickly and accurately,” says 

Shing. 

“Regulators around the world are 

increasingly pushing for greater 

transparency and efficiency in financial 

markets, which has been a major driver 

of electronification. By requiring firms 

to move to electronic trading systems, 

regulators hope to reduce market 

manipulation and improve market 

integrity,” says Shing. “By moving to 

electronic trading systems, trading firms 

can reduce costs associated with manual 

trading, such as the costs of hiring 

traders and administrative staff. This can 

lead to increased profitability for trading 

firms.” 

Electronic trading systems have made 

it easier for trading firms to find 

counterparties and execute trades, says 

Shing. “At Euronext Markets Singapore, 

we’ve seen increasing liquidity from Tier 

1 banks expanding their global reach 

as well as from local specialists as they 

embrace advancing technology. Electronic 

trading systems have also allowed 

trading firms to access real-time market 

data, allowing them to identify trading 

opportunities and make more informed 

decisions more quickly. This can lead to 

increased profits for trading firms.” 

The main challenge of delivering NDF 

algorithms is that they are complex and 

require a lot of data to be processed 

to accurately calculate the forward 

rate, says Shing. “Additionally, NDF 

algorithms can be sensitive to market 

conditions and changes in foreign 

exchange rates, which can make them 

difficult to implement. To improve upon 

these challenges, machine learning 

algorithms are being used to better 

predict the forward rate. Furthermore, 

NDF algorithms are being improved by 

incorporating more data points and 

creating more sophisticated models. 

This allows them to better account for 

potential shifts in the foreign exchange 

rate and react accordingly. Finally, the 

use of big data analytics and artificial 

intelligence is being used to further 

enhance the capabilities of NDF 

algorithms,” he states. 

As the global economy becomes 

increasingly interconnected, demand for 

NDFs will continue to grow, says Shing. 

“The continued growth of electronic 

trading platforms further strengthens 

the market for NDFs and makes them 

more accessible to a wider range of 

investors. Additionally, the development 

of automated pricing models, increased 

liquidity, and better price transparency 

will make NDFs even more attractive 

to both buyers and sellers. As more 

financial institutions adopt electronic 

trading systems, the market for NDFs 

will become even more efficient and 

liquid, allowing for more competitive 

pricing and faster transactions. As the 

market matures, more exotic currencies 

will become available, allowing market 

participants to access markets they may 

have previously been unable to access. 

All these developments will help to 

further unlock the potential of NDFs 

and make them an even more attractive 

financial option,” says Shing. 


NDF trading at 

Euronext Markets 

Singapore 

Euronext FX is a leading ECN for Spot FX and Precious 

Metals, as well as NDFs through its Singapore 

subsidiary Euronext Markets Singapore. Powered by 

award winning FastMatch ® technology, Euronext FX 

with Euronext Markets Singapore has matching engines 

in London, New York, Tokyo and Singapore. This bestin-class 

technology is leveraged to deliver flexible 

execution solutions and quantitative market data 

products. 

Clients can trade FX NDFs through its subsidiary, 

Euronext Markets Singapore, a Regulated Market 

Operator (RMO) licensed by the Monetary Authority 

of Singapore (MAS). As the first FX ECN to launch in 

SG1, Euronext Markets Singapore enables clients to 

access local Asia-centric trading partners with reduced 

latency. NDF liquidity pools are locally managed, 

leveraging the same unique functionalities and 

FastMatch ® technology as in our Spot market. 

KEY FEATURES 

• Local NDF matching available in SG1 and LD4 

engines 

• USD Crosses with: 

• Asia: CNY, IDR, INR, KRW, PHP, TWD 

• LatAm: BRL, COP, CLP, PEN 

• Customised liquidity pools: Including firm and last 

look, anonymous and semi-disclosed, sweepable 

and full amount, SkewSafe 

• Full range of order types including market and limit 

orders, pegged algos and icebergs 

• Unparalleled speed powered by award winning 

FastMatch ® technology and functionality 

• Clients of Euronext Markets Singapore may connect 

through our data centres in Singapore (SG1), New 

York (NY4), London (LD4) and Tokyo (TY3) 

• Connect via FIX API 

• Euronext Markets Singapore has been granted SEF 

equivalency by the CFTC 

• Protection variants including leak/sweep protection 

and full amount lock-in 

Euronext FX is a company of Euronext, the leading multi-asset and pan-European 

exchange with markets in Amsterdam, Brussels, Dublin, Lisbon, Oslo, Paris and Italy. 

sales_fx@euronext.com 

This publication is for information purposes only and is not a recommendation to engage in investment activities. This publication is provided “as is” without representation or warranty of any 

kind. Whilst all reasonable care has been taken to ensure the accuracy of the content, Euronext does not guarantee its accuracy or completeness. Euronext will not be held liable for any loss or 

damages of any nature ensuing from using, trusting or acting on information provided. No information set out or referred to in this publication shall form the basis of any contract. The creation 

of rights and obligations in respect of financial products that are traded on the exchanges operated by Euronext’s subsidiaries shall depend solely on the applicable rules of the market operator. 

All proprietary rights and interest in or connected with this publication shall vest in Euronext. No part of it may be redistributed or reproduced in any form without the prior written permission of 

Euronext. Euronext refers to Euronext N.V. and its affiliates. 

© 2023 Euronext N.V. – All rights reserved. 


The value of performance 

analysis and network monitoring 

solutions to the trading world 

Beeks Group outlines how a costly IPO sparked the genesis of 

Market Data Capture and Replay solution mdPlay 


Following a period of subdued activity 

post-pandemic, the IPO markets are 

regaining momentum. Looking back 

at Alibaba’s record launch in 2014, 

valued at over $169 billion, we now 

find the company once again in the 

spotlight with the press reflecting 

on its prospects of taking two of 

its subsidiaries to IPO in 2024 and 

subsequent abrupt share price decline. 

IPOs are not straightforward. But the 

most pertinent risk for this piece is 

how IPO trading offers a gruelling test 

of Capital Markets’ participants’ IT 

infrastructure. 

THE IMPORTANCE OF 

PERFORMANCE ANALYSIS 

CEO of Capital Markets infrastructure 

specialist Beeks Group, Gordon 

McArthur clearly states: “IPO trading 

can be so busy that it can seriously 

expose weaknesses in a company’s 

data handling performance. Real-time 

data is crucial – and when real time 

is measured in nanosecond units you 

need to be able to capture, analyse 

and replay data with extremely high 

precision to be able to fully understand 

what’s happening when your system is 

misbehaving.” 

Beeks prides itself on being Capital 

Markets’ dedicated Infrastructure-asa-Service 

(IaaS) provider since 2011. 

Over the years they have honed the 

technology to support, monitor and 

protect trade executions and trading 

performance metrics in Capital 

Markets, Banks, and Financial Services 

companies. 

For this, the organisation provides the 

tools and services to ensure businesses 

have a high level of timely visibility 

of where in their trading network 

problems are occurring. They also 

have the expertise and knowledge 

to resolve performance issues in an 

agile manner, thus mitigating loss of 

profitability. 

“It’s not always easy to see what’s 

happening under the trading bonnet, 

and it’s dangerous to take a bargain 

basement approach to performance 

monitoring, especially during highprofile 

IPOs,” McArthur asserts. “A lot 

of businesses run the risk of being 

duped by their data. While things might 

look like they’re working properly, 

without the proper infrastructure it isn’t 

possible to see that things have broken 

until it’s far too late, and a lot of money 

has been lost.” 

A CAUTIONARY TALE 

To illustrate this, Beeks Analytics 

Chief Technology Officer (CTO), Steve 

Rodgers recalls a particular issue at 

a market participant as they tried to 

engage in the trading around Alibaba’s 

debut IPO back in 2014. He says: “The 

institution lost a significant amount 

Gordon McArthur 

of money during the Alibaba IPO 

and couldn’t work out how. With no 



real-time monitoring and a reliance on 

reactive replays from their application 

logs, they had no visibility of what had 

actually gone wrong. They couldn’t 

see any faults, the market data ticker 

plant reported processing 100% of 

the data with no loss downstream to 

trading applications. Yet they still made 

a significant loss during trading.” 

Outlining how Beeks got involved, 

Rodgers says: “At the time the 

institution was aware of Beeks as a 

vendor for their performance lab and 

so they invited us to troubleshoot. We 

found that their incumbent hardwarebased 

market data ticker plant was to 

blame.The Alibaba IPO was causing 

microbursts the ticker plant could 

not keep up with when operating in 

low latency mode. Live market data 

feeds were overwhelming the system 

and causing delays. All the data was 

eventually delivered, but delayed 

just enough to give the bank a false 

position of what was happening 

at those extremely busy periods of 

market activity.” 

Beeks identified that the initial attempts 

to reproduce the problem from feed 

handler logs were unsuccessful because 

the microbursts were not captured 

correctly at the time and ended up 

being flattened out when replayed. It 

took a high-fidelity historical capture of 

the original trading day, replayed with 

nanosecond precision to reproduce the 

fault reliably. 

THE BIRTH OF THE MDPLAY 

In low-latency environments, 

performance analysis and network 

monitoring solutions are vital 

components. High-fidelity packet 

capture and precision replay 

capabilities give firms greater scope 

for more targeted drilling down and 

quicker resolution when issues arise. 

“In 2014 we used mdPlay to 

demonstrate the original fault to 

Steve Rodgers 

their ticker plant vendor who were 

eventually able to understand and 

resolve the problem,” says Rodgers. 

“This experience effectively gave rise 

to our unique mdPlay managed service 

offering. At the time mdPlay represented 

an all-in-one system to carry out all 

its own capture, replay and scenario 

management delivered as a turnkey 

managed service,” he says. “In the 

intervening decade, mdPlay has been 

automated, giving end-users instant 

visibility of scenarios on-demand and the 

ability to manage the tool themselves.” 

MDPLAY CAPABILITIES VS 

COMPETITORS 

Traditional solutions would read the 

recorded market data directly from 

storage and in doing so introduce 

latency and jitter which was not present 

in the original. These solutions also 

smooth out peaks in market data which 

would have potentially been the cause 

of application issues. 

mdPlay takes a different approach. It 

spools up the replay and pre-caches 

everything, resulting in maximum 

fidelity and accuracy in reproduction. 

The replayed scenarios are published 

to the network exactly as they were 

originally transmitted during live 

trading: a true like-for-like reproduction. 

mdPlay also replays data through the 

same infrastructure and code as the 

production path, which helps rule out 

or identify infrastructure causes. 

mdPlay also allows a library of 

scenarios to be built up to automate 

testing of system behaviour against 

known problematic market conditions 

- essential for QA and backtesting 

of algorithmic trading systems. In 

addition, mdPlay can alter the replay 

speed with precision - answering 

“what if?” questions such as ‘what 

if the markets were twice as fast’, 

or ‘what if we move from 10Gbit to 

40Gbit networks?’ 

SUMMARY 

“As with all trade executions, Capital 

Markets businesses need a robust 

strategy, plan and infrastructure 

capability to take advantage of 

the best prices, whether public 

launch events or daily tick to trade,” 

comments CEO McArthur. “It’s a 

delicate and ongoing balance between 

timely trade and vigilant monitoring. 

mdPlay forms part of our suite of 

Analytics tools that enable exactly 

that.” In conclusion, McArthur says: 

“Essentially our competitors can point 

out problems. With mdPlay, you can 

anticipate and prevent them.” 




Vivek Shankar 



Putting data at the heart 

of FICC business strategy 

By Vivek Shankar 

Fragmentation. Regulatory changes. 

Volatility. It’s safe to say the FX markets 

have posed significant challenges to 

market participants. Firms have long 

believed in the power of harnessing 

data to help them achieve higher levels 

of efficiency but have experienced a 

few hurdles. 

“Building and running a data pipeline 

is complex and expensive, especially 

at scale and with the performance 

levels that a trading firm needs,” 

says Stephen Totten, Director of 

Quantitative Analysis at oneZero. 

“Firms may have systems in place to 

capture data, but to use that data in 

a consistent and repetitive process 

means that they must be able to 

deal with outages, backfill missing or 

erroneous data, normalise data from 

multiple sources, and flag and clean 

any outliers.” 

Matthew Hodgson, Founder and 

CEO of Mosaic Smart Data, points 

to another issue. “Firms also need 

to extract insights from a growing 

number of unstructured data sources 

in addition to their internal client data, 

including newsfeeds and other macro 

sources.” 

DATA IMPLEMENTATION 

CHALLENGES AND TIMELINES 

Institutions draw data from several 

sources, and poor data organisation is 

creating silos that complicate analysis. 

“Firms trade with counterparties 

on multiple different channels- 

Single bank platforms, APIs, multidealer 

venues, and ECNs,” says 

Tim Cartledge, Chief Data Officer 

at Tradefeedr. “The result is that 

trading data is fragmented and overly 

complex. An independent trading data 

network provides a single, consistent 

view of trading data for all parties- 

Liquidity Providers, the buy-side, and 

trading platforms.” 

This network offers several benefits 

for all stakeholders, he explains. “LPs 

can demonstrate the quality of client 

pricing at review meetings and use 

analytics to optimise pricing engines 

and trading algos.” 

“Buy-side traders can make datadriven 

trading decisions that cut costs 

and maximise opportunities, while also 

proving best execution.” Cartledge 

points to Tradefeedr’s Algo Forecasting 

Model as an example of data driving 

productivity. 

“Against this backdrop, many FX 

trading firms struggle to unlock the 

value in their data and transform it 

into actionable insights.” Is the data 

challenge a step too far for FX market 

participants? Well, not quite. While 

challenges exist, technology is evolving 

to offer novel solutions. 

Buy-side traders leverage analytics to 

choose the most appropriate algo for 

a trade, and LPs can refine algos by 

analysing their performance. 

Totten also points to data’s benefits 

when monitoring client behaviour and 

using analysis conclusions to increase 


Putting data at the heart of FICC business strategy 


“Building and running a data pipeline is complex and 

expensive, especially at scale and with the performance levels 

that a trading firm needs,” 

Stephen Totten 

market share. “If a client is increasing 

activity in a currency, or changing 

their hedging policy,” he explains, 

“sales can engage with the customer 

to understand what’s changed and 

recommend a better solution.” 

“Secondly, sales can feed that 

information to trading desks, 

helping them adapt pricing and 

risk management to service the 

new behaviour optimally. oneZero’s 

classification model for client flow 

management, for example, continuously 

monitors client trades and flags changes 

in trading profiles, helping firms 

proactively engage with their customers 

and rapidly react to changes.” 

Hodgson says a laser-like focus 

on productivity has been the key 

for firms that have navigated 

challenging market conditions this 

year. “Extracting insight from data is 

a critical step in enabling banks to do 

more with less,” he says. 

“To put this into context, following 

a recent pilot with Mosaic, a tier 1 

FX bank reported a 20% increase in 

call volumes, 22% increase in call 

duration, 18% increase in enquiries – 

and 100% of its users wanted to move 

to production immediately because of 

the extent to which they were able to 

enhance their productivity.” 

He’s quick to point out that such 

results need some foundational work. 

“It’s not quite as simple as flicking 

a switch and suddenly extracting 

actionable insight from your data.” 

“Firms need to start with a solid 

foundation of properly aggregated, 

normalised, and enriched transaction 

and market data. From this solid 

foundation, advanced analytics and 

AI tools can then begin to deliver 

value, providing insights across the 

organisation.” 

Cartledge explains that data 

normalisation used to be expensive, 

but data solutions providers now offer 

this as standard. “Also, there has been 

a view that firms need to hire their 

own data analysts to get value from 

the data,” he continues. 

“Again, this is not the case, some of 

our larger clients build their analytics 

using our data API, but many more 

use our pre-built reports to quickly get 

value from the data, like TCA reports.” 

Totten points out that conducting a 

normalisation exercise might cause 

trading firms more problems than it 

solves. “The FX markets have a wide 

range of trading venues and there can 

be considerable variation in protocols, 

as well as volume, depth, and quality 

of data, between different liquidity 

providers,” he says. 

“There is also a risk that in normalising 

the data the firm loses some key 

information from feeds, so a deep 

understanding of different venues and 

their protocols is very important.” He 

recommends working with a marketneutral 

technology vendor with prior 

expertise. 

Hodgson notes that data normalisation 

exercises tend to spiral out of control 

due to errors in the decision-making 

process. In turn, these errors increase 

costs and stretch implementation 

timelines unreasonably. 

Banks are looking to unleash AI and machine learning to take their data analytics to the next level 

“Surprisingly, many of these decisions 

have historically been based on 

emotion,” he says. “Decision-makers 


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“Extracting insight from data is a critical step in enabling 

banks to do more with less,” 

Matthew Hodgson 

choose what ‘feels right,’ or rely 

on past experiences working with 

unrelated vendors on a different 

requirement. Ideally, decisions would 

be based on the key criteria of cost, 

efficiency, productivity, and speed to 

market, delivered through the lens of 

specialised capital markets expertise.” 

Totten and Cartledge agree with 

Hodgson that implementing a data 

solution in-house might lead to 

unreasonable timelines and costs. “As 

such it’s very important for firms to 

think carefully about what they want 

to build in-house,” Totten says. “Where 

they may have significant IP and what 

they want to buy to speed up that 

time of getting to market.” 

SIFTING THROUGH SERVICE 

PROVIDERS 

PARTNERING WITH THE RIGHT 

SERVICE PROVIDER IS CRITICAL 

So what can trading firms and banks 

expect from the latest generation of 

data solutions providers? Hodgson lists 

a few benefits. “A bank can achieve a 

single, holistic view of FX transaction 

data across all its global locations, 

across all trading channels, and all 

asset classes, combined with the 

relevant market data,” he says. 

This will help them unleash AI and 

machine learning to take their 

analytics to the next level, he adds. 

“Banks are now beginning to use AI 

to look at each client as their own 

segment, and hyper-personalise the 

insights and service they provide 

them,” Hodgson says. 

“This is optimised with natural 

language generation technology, 

which delivers reports such as multiasset 

morning briefings in a human 

tone of voice with easy-to-interpret 

analytics. The result for the bank is 

increased loyalty and a greater share 

of mind amongst clients.” 

Cartledge says Tradefeedr customised 

its offering based on client needs. 

“Many new clients start with standard 

analytical reports which auto-populate, 

then progress to a slightly more 

advanced and bespoke toolkit where 

users can select different tools or 

widgets to build their specific reports,” 

he says. “Our service is also available 

as an API feed for clients to capture 

our data directly into their systems to 

analyse the data themselves.” 

“oneZero has been working intensively 

in the data space for many years,” 

Totten says, “and we are now on 

our 4th-generation platform. Every 

iteration is improving on the last, and 

building extensive feedback into the 

next.” 

“Technology solution partners also 

need to be able to capture ever more 

data and devote more and more 

computing power to its analysis,” he 

adds, “which in practice now means 

access to significant cloud-based 

functionality.” 

“oneZero’s Data Source is a nextgeneration 

cloud-based intelligence 

toolkit that does just that, by 

capturing and modelling quote and 

trade data for our clients - their Data 




“Another key point is that when you are using data analytics 

to prove Best Execution, independence matters.” 

everyone outside the very largest 

institutions could struggle.” 

Hodgson says the markets will soon 


Tim Cartledge 

Source DNA as we call it.” 

All three point to experience as a 

critical factor when choosing a service 

provider to work with. “We partnered 

with the European Space Agency back 

in 2018 to explore how AI algorithms 

developed for use in space could 

be adapted and deployed in capital 

markets,” Hodgson says. 

“Fast forward to today, and this 

technology is in real-world deployment 

in live capital markets by a number 

of our customers who were able to 

benefit instantly from this cuttingedge 

technology that originated in a 

completely different field.” 

Totten stresses oneZero’s vast expertise 

too. “Deep industry knowledge 

combined with our expert technology 

and operations teams means that 

we are delivering solutions that add 

significant value for our clients,” he 

says. “We have a growing proportion 

of team members out of our total of 

over 170 staff who have wide-ranging 

experience from brokerages, banks, 

exchanges, and prime brokerages.” 

Cartledge says working with 

experienced service providers helps 

firms squeeze more out of their 

data and cites an example.”We 

would not have been able to launch 

algo forecasting without detailed 

knowledge of the FX market and 

specifically FX execution algos,” 

he says. “Another key point is that 

when you are using data analytics to 

prove Best Execution, independence 

matters.” 

WHERE ARE DATA SERVICES 

HEADED NEXT? 

AI and ML have hogged headlines 

this year, and Totten, Cartledge, 

and Hodgson are excited about its 

potential. When asked about future 

developments all three identify 

unleashing more AI use cases as the 

next frontier. 

“We are already using ML in our 

algo forecasting model and its use 

will continue to grow,” Cartledge 

says. Totten concurs and says 

that as AI models become more 

sophisticated, trading firms can 

expect huge results. 

“One of our models analyses client 

flows and markouts, for example, 

across millions of trades a day,” 

Totten says. “This analysis enables 

a more scalable and efficient 

understanding of trading styles 

and preferences, with the ability 

to segment information to ensure 

that FX flows are priced and risk 

managed optimally.” 

But he’s quick to caution that greater 

AI sophistication brings firms back 

to a central issue - Data volumes and 

management. 

“The more sophisticated the model, 

the more data is needed to train 

these to fully capture all of the 

market dynamics,” Totten continues, 

“and this is a key area where almost 

reach a stage where AI and ML-driven 

analytics will become table stakes. 

“Forward-thinking tech players 

continue to build on this innovation 

and shape the future of the industry 

for the years ahead,” he says. 

“There is never a good or bad time 

to be innovative, but in the current 

environment, all innovation should 

be laser-focused on helping achieve 

the business’s KPIs,” he adds. 

“Technology platforms will be judged 

by their ability to impact a bank’s 

bottom line without breaking the 

bank to deploy in the first place, 

and their strength when it comes to 

supporting change management.” 

Cartledge looks beyond AI and 

identifies another critical area service 

providers must develop. “Perhaps as 

important is data analytics services 

supporting cross-asset trading,” he 

says. “With this in mind, we are 

currently adding Futures and Equities 

to the Tradefeedr platform.” 

“It sounds obvious, but the value 

of FX data analytics comes from a 

combination of how much of the 

market is captured,” he continues, 

“the quality of the data, and the 

tools provided. The technology and 

tools are important, but equally so is 

the network.” 

While adopting data pipelines to 

boost trade efficiency is always 

challenging, firms have no choice but 

to tackle this complexity. Partnering 

with the right service provider is 

critical, of course. 

However, committing to build 

processes that extract the most from 

data is perhaps the most critical 

element in this picture. 



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