Forefront Fintech Digest Week in Review: September 3 – 6
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Broker News
Jane Street Ups its Game in FX Market-Making
Risk.net | Joe Parsons
High-speed trading firm Jane Street has expanded its spot foreign exchange market-making services to include direct streaming of liquidity. As of this year, the firm is distributing its spot FX pricing to certain clients via disclosed, bilateral workflows – both on its proprietary single-dealer platform (SDP), JX, and hosted on trading venues, says a person familiar with the firm. Up until this year, JX had been Jane Street’s SDP for European Union, UK and US equities. It also operates a digital assets SDP called JCX.
Morgan Stanley Renews Efforts to Regain Stock Trading Crown
Financial Times | Joshua Franklin & Costas Mourselas
Morgan Stanley has stepped up efforts to regain its traditional dominance in stock trading, a position it ceded to longtime rival Goldman Sachs in the wake of the 2021 implosion of Archegos Capital Management. Under new chief executive Ted Pick, who previously headed the bank’s equities trading business, Morgan Stanley has narrowed the gap with Goldman to its smallest since 2022.
Ex-Cboe CEO Tilly Takes Over Top Job at Clear Street
Bloomberg News | Katherine Doherty
Ed Tilly, the former chief executive officer of Cboe Global Markets Inc., has landed a new CEO post after his decade-long run atop the public exchange abruptly ended over his failure to disclose personal relationships. Tilly will take over at brokerage-service provider Clear Street as Chris Pento, the co-founder and current CEO, steps down and transitions responsibilities in coming months, according to a memo seen by Bloomberg News. Pento will remain on the board and join Uri Cohen’s White Bay family office by year-end, Pento said in the memo.
Virtu Rolls Out New Switcher Algo
The TRADE News |?Annabel Smith
Virtu Financial has moved to expand flexibility for its clients when looking to trade algorithmically by allowing them to switch algorithms mid-way through an order. Named Switcher, the new “algorithm of algorithms” as so-called by Virtu is designed to allow clients greater optionality for an order throughout its lifecycle depending on changing conditions. “Clients have been asking for a more dynamic approach to algo wheel implementations that solves the constraint of only using one algo strategy for each order,” James Osborne, global head of algorithmic development at Virtu Financial told The TRADE.
‘Why Not Dallas?’ How ‘Y’all Street’ Aims to Become America’s Next Financial Titan
Dallas Morning News | Irving Mejia-Hilario
Dallas has nine Fortune 500 companies, 24 when counting the broader D-FW area. A Downtown-based stock exchange is on the horizon, corporate giants are moving headquarters and offices in the area and more wealthy individuals are beginning to call the city home. For years, economists have somewhat gawked at the idea of Dallas knocking off America’s supercities like Chicago and New York City as financial hubs. But with its varied growth in population — residential and corporate — more are becoming bullish on Big D’s momentum.
Exchange, ATS & Clearing News
Facing Platform Shutdown, Former IEX Cloud Head Buys Its Assets in 11th-Hour Bid
WatersTechnology | Rebecca Natale
On August 12, Tim Baker, former head of IEX Cloud, told his former colleague, Pedro Aguayo, that he thought it was a shame that IEX, a New York-based upstart exchange, had decided to shutter its cloud-based data marketplace and development center. The business accounted for less than 2% of IEX Group revenue and had run at a loss since its inception. On May 31, IEX alerted clients that they had three months to find alternatives, as it planned to retire all IEX Cloud products on August 31.
BlueCrest’s FX Trading Platform, BlueX, Goes Live
Markets Media | Staff
BlueX, the transformative FX trading technology platform, is delighted to announce its official go-live, with the first production trades now executed. This follows the recent granting of its licence by the Jersey Financial Services Commission (JFSC). BlueX provides a wide range of unique trading tools and workflow automation, offering global institutional market participants versatile and efficient trading solutions.
IntelligentCross Adds Scott Kursman as Chief Compliance Officer
Traders Magazine | Staff
IntelligentCross, a leading US equity trading venue, announced today that it has hired Scott Kursman as Chief Compliance Officer. Kursman was previously at Citi, where he served as Managing Director and Chief Compliance Officer for Citigroup Global Markets, Inc., and Citibank, N.A. Swap Dealer. In his new role, Kursman will report to Roman Ginis, Founder and CEO of the parent company Imperative Execution, and will be responsible for overseeing all compliance matters for the broker dealer subsidiary, IntelligentCross. ?
CBOE Starts Platform for Trading Private Company Shares
Bloomberg News | Miles Weiss
CBOE Global Markets Inc. is partnering with a London-based tech firm to create a US trading platform for shares of closely held companies, a traditionally illiquid market that investors have increasingly sought to access. CBOE Private Markets registered with the Financial Industry Regulatory Authority as a broker-dealer, according to a filing in August — an essential step in setting up a so-called alternative trading system. The new venue will compete with a platform that Nasdaq Inc. spun out in 2021.
A Rate for Main Street: Why Commercial Banks Urgently Need Credit-Sensitive Benchmark Interest Rates
AFX | N/A
It’s 2024. Do you know what your overnight borrowing costs are? For many regional and community banks, the answer is no – and poor regulatory guidance is a primary cause. After years of manipulation scandals, the LIBOR interest rate was thankfully officially discontinued on June 30, 2023. At last, financial institutions had an opportunity to assess their risk using an uncorrupted rate based on real transactions. Yet just days later, IOSCO issued a statement on alternatives to LIBOR.?
Vendor News
Appital Expands European Equity Coverage Through Addition of Virtu Financial’s POSIT MTF
The TRADE News | Wesley Bray
Appital has expanded its European equity coverage to more than 21,000 equities across 24 European countries with the addition of Virtu Financial’s POSIT MTF as a European execution venue. The firm has also added Virtu Financial as an executing broker for client flows negotiated on Appital’s BookBuilder platform, offering buy-side participants improved options for executing large orders.?
ActiveViam Announces Leadership Succession
Press Release | N/A
ActiveViam, a global provider of advanced data analytics and decision-making solutions for financial services organizations, announced today that its Board of Directors has unanimously elected Shelley Magee to succeed Kathy Perrotte as the company's chief executive officer, effective immediately. Ms. Magee will join the Board of Directors, and Ms. Perrotte will remain on the Board and act as special advisor to the company. To ensure a smooth transition, Ms. Magee and Ms. Perrotte will work closely together through the end of 2024.
Broadridge Hires Brian Pomraning as Chief Product Officer for Trading and Connectivity
Finance Magnates | Jared Kirui
Broadridge has hired Brian Pomraning as its Chief Product Officer for trading and Connectivity Solutions. Pomraning will spearhead the global product management organization, which encompasses the company’s trading and connectivity products and services. Pomraning is joining Broadridge from Exegy, where he most recently served as the Chief Revenue Officer.
Kepler Cheuvreux Builds Proprietary Execution Platform With Adaptive
WatersTechnology | Emma Hilary Gould
Paris-based broker Kepler Cheuvreux has built a proprietary trade execution platform with Adaptive, a London-based financial tech consultancy and provider of custom trading platforms. Kepler wanted to move away from outsourced vendor technology, especially as the EU’s Digital Operational Resilience Act (DORA) will place stricter regulations on third-party software starting in January. Owning its execution platform means the firm can scale and customize its business offerings, such as the addition of new asset classes independent of vendors’ timelines.?
Buy-Side News
Cliff Asness Says Markets Are Less Efficient — And Social Media May Be to Blame?
Bloomberg News | Sam Potter & Justina Lee
Cliff Asness says he sounds like an “old man whinging,” but that’s not stopping him from writing 23 pages on his latest thesis: Financial markets these days aren’t what they were. The often-cantankerous co-founder of AQR Capital Management just published new research that amounts to a detailed exposition of an argument he has repeatedly raised of late, namely that the market has become less efficient over the course of his more than three-decade career.
领英推荐
Hedge Funds Kite Lake and Astaris Prepare to Close to New Cash
Bloomberg News | Nishant Kumar
Two hedge funds in London are preparing to close to new cash even as the broader industry bleeds tens of billions of dollars in capital. Kite Lake Capital Management will stop taking money in its flagship $1.4 billion KL Special Opportunities Fund on Oct 1, according to an investor letter and a person familiar with the matter. Martin Beck’s $650 million Astaris Special Situations Master Fund, which contains money from investors including Blackstone Inc., is also preparing to close to new cash once assets reach €1 billion ($1.1 billion), another person said.
Andreessen Horowitz Ditches Miami Two Years After Opening Office
Bloomberg News | Anna J Kaiser
When Andreessen Horowitz opened an outpost in Miami Beach, the $43 billion venture capital giant bolstered the region’s ambitions of becoming a tropical tech mecca. Two years and a crypto meltdown later, that office has been quietly shuttered. Andreessen Horowitz exited the space in May because employees weren’t using it enough, said people familiar with the matter, who asked not to be named citing private discussions.
A Third of Hedge Funds Have Not Fully Recovered From 2022’s Losses
Institutional Investor | Michelle Celarier
While hedge funds as a group have posted their best half-yearly performances in three years, a third of them still haven’t fully recovered from the depths of 2022’s downturn, according to a new Goldman Sachs report on the state of the industry. In 2022, the bursting of the technology bubble led to hefty double-digit losses for many hedge funds, with at least one famous fund — Tiger Global — down more than 50 percent.
M&A / Investment News
Analog Secures $1BN Millennium Backing
Hedgeweek | Staff
Analog Century Management, the New York-based tech-focused hedge fund founded by Val Zlatev, has joined the growing roster of external firms to secure capital from Izzy Englander’s Millennium Management, with the multi-strat major making a $1bn allocation, according to a report by Bloomberg. The report cites unammed sources familiar with the matter as revealing that Zlatev will manage a market-neutral equities strategy focused on technology through a separately managed account for Millennium, while also overseeing capital for other clients.
Morgan Stanley Invests in 3forge
Markets Media | Staff
3forge, the leader in innovative High Impact? code solutions for business-critical applications, announced that it has closed on an investment by Morgan Stanley. This is the first time 3forge has raised external capital since launching in 2011. 3Forge is a high-performance platform used by developers to build enterprise applications. Its technology has enabled the rapid development and deployment of front-end applications with a focus on real-time data integration, virtualization, processing and visualization.
Chinese Brokerages to Merge, Creating a $228 Billion Entity
Wall Street Journal | Sherry Qin
China’s efforts to consolidate its financial-services sector took a big step forward as two of the country’s largest state-backed brokerages agreed to combine to create a giant with about $228 billion in assets. Guotai Junan Securities and smaller peer Haitong Securities will merge through a share swap, the companies said late Thursday. The combination of the Shanghai-based firms will create a new entity with about 1.619 trillion yuan in assets as of June, equivalent to $228.28 billion, overtaking Citic Securities as China’s largest brokerage.
Natixis Sells Private Credit Business MV Credit to Clearlake Capital
Fintech Futures | Tyler Pathe
US-based private equity firm Clearlake Capital Group has sealed a deal to acquire MV Credit, a pan-European private credit business with $5.1 billion in AUM, from Natixis Investment Managers.?Active in the private credit space for over two decades, MV Credit specialises in providing fund solutions for investors across senior direct lending, subordinated direct lending, hybrid, and collateralised loan obligation (CLO) strategies.?
Regulatory & Legal News
Citadel Securities Leads Fight Over Payments for Market Surveillance System
Financial Times | Jennifer Hughes
Citadel Securities is leading industry pushback against an effort by exchanges including the New York Stock Exchange and Nasdaq to ask traders to help foot the bill for a new market surveillance system that has already racked up almost $1bn in costs.?Brokers are calling for the regulator to suspend proposed new billing schedules that would force them to contribute to the costs of the CAT system, or Consolidated Audit Trail, a real-time record of all activity across US equities and options markets, which has been likened to a “Hubble Telescope” for securities markets.
SEC’s WhatsApp Probe Expands as Moody’s, S&P Hit With Fines
Bloomberg News | Lydia Beyoud
Moody’s Corp., S&P Global Inc. and Fitch Ratings Inc. will pay a combined $48 million over allegations that the credit-rating companies failed to keep proper electronic communications — the latest fallout from US regulators’ so-called WhatsApp investigations. The Securities and Exchange Commission said Tuesday that Moody’s and S&P will each pay $20 million to settle the cases, while Fitch will pay $8 million. The firms acknowledged violating the agency’s recordkeeping rules and will retain a compliance consultant, the SEC said in a statement.
Wall Street’s T+1 Switch Is Proving Tougher Than Anticipated
Bloomberg News | Greg Ritchie
This year’s seemingly smooth transition to a faster settlement regime for US stocks turns out to have been far from plain sailing for many industry players, according to Citigroup Inc. From overhauling arcane funding processes to relocating traders across oceans, the late-May switch to the system known as T+1 proved tougher than expected, the bank found in a survey of market participants.
The SEC Needs a Hand With Artificial Intelligence
WatersTechnology | Eliot Raman Jones
In some ways, I think I live a similar life to someone in the US Securities and Exchange Commission’s (SEC) enforcement division. We both get hundreds of emails every week from companies boasting their prowess in emerging technologies, using adjectives such as ‘industry-leading’ and phrases like ‘the first to achieve.’ And both of us have to use a lot of critical thinking to work out whether that company is being honest or perhaps overzealous. Where our jobs differ, though, is in determining the intent behind these emails.
Crypto?& Digital Asset News
Crypto Firm OKX Hires Former Grab Exec to Be Singapore CEO
Bloomberg News | Ryan Weeks & Suvashree Ghosh
Crypto exchange OKX named former regulator Gracie Lin as CEO of its Singapore business in a statement on Monday. Lin previously held positions at Monetary Authority of Singapore as well as at Grab and GIC.?The digital-asset firm’s Singapore unit OKX SG also received a Major Payment Institution license from MAS that allows the entity to offer digital payment token services including spot trading, according to the statement. Lin will focus on compliance and product enhancements initially, she said in an interview with Bloomberg News.
SEC Commissioner Mark Uyeda Calls for S-1 Form Tailored for Digital Assets
CoinDesk | Parikshit Mishra
The U.S. Securities and Exchange Commission (SEC) should create a special version of the S-1 form for digital assets, SEC commissioner Mark Uyeda said at the Korea Blockchain Week in Seoul, South Korea. The agency's current form, the primary application companies must fill out to register securities in the U.S., does not do justice to digital assets and other unusual financial products, Uyeda said. The regulator has not done enough for digital asset products looking to register in the country, he said.
Citi Survey Finds Fewer Institutions Want CDBC for Digital Asset Settlement
Ledger Insights | Staff
Today Citi published its latest Securities Services Evolution whitepaper. DLT and digital assets is one of three topics covered. A survey of almost 500 institutions found that there is less demand for using CBDC for digital asset settlement than in the past. Instead, there’s a greater emphasis on alternative digital payment methods including non bank stablecoins, tokenized deposits and tokenized money market funds. The shift is quite significant. Last year 52% of respondents expressed a need for CBDC, but that figure dropped to 15% in the latest survey.
Former MT. Gox CEO to Launch Ellipx Crypto Exchange in Europe
Cointelegraph | Josh O’Sullivan
Mark Karpeles, the former CEO of the defunct cryptocurrency exchange Mt. Gox, will launch a new crypto exchange called EllipX in September. Based in Poland, the platform will initially serve European users with plans to expand globally. It will start as crypto-only but potentially add banking and fiat currency services later. EllipX aims to comply with the European Union’s Markets in Crypto-Assets Regulation (MiCA) and promote transparency through regular third-party audits.