OFFERING COLOCATION SERVICES AND ABILITY TO REDUCE NETWORK LATENCY BY USING OUR PRIVATE INTER-DATACENTERS LINKS
SA valuable service will be the co-location of client servers at our data center location – or the sale of VPS (virtual private server) services. Currently VPS is highly demanded in the FX markets, as it allows for a quick implementation of a client’s API close to the exchanges to minimize latency in market data and order execution. In short, a client “loads” his strategy coded to our FIX API into our server close to the exchange matching engine. We anticipate a surging demand for this service in 2018 as crypto trading becomes more universally accepted.
Currently, internet latency for order entry and execution is around 150 ms over the internet from a home or office that is not in a datacenter. XTRD will cut that down by 100x through a VPS solution with an average latency of 1.5 ms, and engage emerging high frequency traders across the crypto spectrum. Liquidity will in turn deepen, and spreads will narrow for the benefit of all market participants – resulting in a virtuous cycle of increasing liquidity and participation in the crypto space. Utilizing current virtualization technologies, one physical server can be converted to 10-15 servers. Virtual servers will use the same physical network switch connection, which will be linked to XTRD’s trading platform. VPS services will serve to popularize our execution services, and execution services will concurrently serve to popularize VPS services. The presence of this infrastructure allows us to serve as a “one stop shop” where one can provide all the required services for fully- featured cryptocurrency trading; namely, connection to all exchanges via one FIX API, low transaction costs, best price, hosting, and minimization of counterparty risk once the SPA gateway is developed. From a technical standpoint, XTRD will place our market data aggregation machines as close as possible to exchange colocations, collect data on the spot and relay it in optimal binary format via a high-speed link to the client’s order management module.