Those who don’t learn history, are doomed to repeat it. Because of our experience in the Equity and FX space, we are facing a real deja-vu in crypto. Retail driving markets followed by institutional players, initially dispersed pools of liquidity lately consolidated into one global eco-system.

Of course, crypto markets are different to the let’s say, FX but core concepts will remain the same.

And, based on our own forecasts and observing huge interest from institutional players, we are exploring several promising venues:

– become a licensed market data vendor. Our tech stack allows us to stream market data in a very efficient way (check this articles for details). XTRD is in negotiation with several exchanges (names will be disclosed shortly) to obtain a legal agreement to resell this data. It opens a door to many companies like Bloomberg, Reuters, ICE and so on.

– become an active member of the upcoming clearinghouse/prime brokerage shift. We currently running several pilot projects with cryptocurrency exchanges and traditional clearinghouses to bring this concept to production. XTRD role is a pipe between buy-side firms (and market makers) from one side and exchanges and prime brokers — from another side.

It’s halfway through 2018, and the crypto landscape is maturing quite well with the advent of normalization, custody, technology, and regulatory clarity.

In a major milestone last month, Ethereum and Bitcoin were declared non-securities by the SEC, paving the way for capital inflows and greater regulatory certainty. A new Bitcoin ETF application was filed, we will hopefully hear the SEC confirmation by 8/10 but likely it will be pushed another 45 days as per approval guidelines. BlackRock is exploring the space too, after their leading employees left to start crypto companies. Participating in the blockchain space is quickly becoming less of a me-too progressive fad for larger organizations and more of a must-have to keep up with rapid developments and client demand for exposure.

This time it’s different — there is custody, more regulatory clarity, minimums that will necessitate larger/accredited investor participation and the entity applying is the CBOE and VanEck.

On the XTRD side, we are seeing the demand for our products spike — but some are in greater demand than others. In particular, this is true of the XTRD Dark Pool solution, leveraging actual banking custodians for fiat and digital asset custodians for crypto to allow for cheap, easy, and vetted large OTC trades.

In line with our road map, we have recently released our FIX API, the unified market data and execution API for institutional use. The following product is to be a downloadable trading platform called XTRD PRO that allows for manual execution across exchanges.

However, given enormous institutional interest in the Dark Pool product, we have decided to prioritize XTRD Dark first. We feel that adjusting to market needs is important, and as the blockchain industry changes quickly, we must be nimble in order to meet incoming demand head on.

For fiat custodianship, the solutions we are leveraging are Noble Markets and Signature Bank, allowing for custody and seamless journal transfers of tens to hundreds of millions of dollars on the fiat side of the XTRD Dark trades.

On the crypto escrow side, we are exploring itBit (US based and fully licensed), DACC (physical custody in secure environment dealing with over 70 tokens) and Noble (digital custody coming!).

By integrating these fiat and digital custody solutions along with a dark matching engine and white-listed participants, a vetted, KYC enabled, fund verified trusted XTRD Dark Pool environment will facilitate hundreds of millions of dollars of large crypto to fiat trades at 20x less cost than current exorbitant OTC transaction middlemen fees.

XTRD PRO and XTRD SPA continue to be our focus and we are aiming to bring them online in 2018, with XTRD PRO coming first. On the XTRD PRO side, we’ll be publishing live screenshots as soon as the production version is in testing. An updated roadmap will be published soon as well.

Also — Thomas Lee’s analysis of the potential scope of the crypto market as driven by a generational shift is quite illuminating — see it here, highly recommended.

Summer is usually associated with vacations, trips, and overall relaxation. But not for the XTRD team! We are using this time to be prepared for the upcoming autumn run.

First of all, we released the new version of FIX API gateway with added Binance support. So now our clients can receive normalized market data and trade on this exchange through our NY4 servers.

There are two exchanges in our “hot list” to be added in the next release — OKEx and Bittrex.

Secondly, we are also working to add more functionality, directly not related to exchanges integration.

To add more value into our real-time normalized market data feed, we decided to add crypto-related news streamed inside the same FIX session!

Information is one of the crucial components of crypto trading. NewsEdge (by AquireMedia) will provide us with real-time updates and analytics(!) about all events that might have an impact on the industry. XTRD will transform NewsEdge wire format into FIX protocol News message(35=B) and then stream to our clients.

Are you looking to build crypto-trading terminal or run trading desk? We get you covered with real-time normalized market data and news coming from the one reliable source.

Despite the fact, that most of the XTRD tech team is hard-core backend developers, we understand entirely that interactions with users are also important. Not all people enjoy black and white terminals and command line interfaces (what a shame…).

In order to provide a more human-friendly interface for the clients, we decided to improve part of the back-office application that used to perform payments in XTRD tokens.

The end goal is to make our clients’ life more comfortable when they are transferring XTRD tokens for obtained services — execution, market data, and cross-connections.

Serg Gulko tried to record a brief video from our location in Equinix NY4 data center. The idea was good but realization completely failed. The only one thing you can learn from this video is the level of noise, created by all these machines.

We want to share with you the most recent updates on what XTRD has been up to!

This week was full of meetings and negotiations, we were exploring possibilities of different partnerships and options to buy-out licensed businesses. Last, but not least — it was a week filled with understanding that we are moving forward in the right way.

First of all, we are pleased to announce that we have added a new low-latency channel to our Hong Kong destination. Its only 173 ms from NY4 to HK1. Check on your side and tell us who is faster :). This will allow us to facilitate worldwide market data streams and faciliate lower latency worldwide execution.

Another reason we did this is a growing relationship with one of the major crypto exchange players in that region.

We were contacted by a global telecommunication company(!) that is looking to deliver normalized market data for crypto to their clients. We want to warn our community that it is not a one-day task to seal that kind of large deal, but we are working on it.

We had a meeting with Kx Systems — truly the number one provider of in-memory vertical databases (sorry, Oracle, this is really true). There are tons of possible interactions starting from simply feeding data into their engine and ending with an integration of XTRD backend with their state of the art trading platform with the capability to offer this to our clients.

Another great conversation we had is with Blockchain Terminal. Super smart guys, great technology, and solid vision. Like us, they want to focus on the part of the business that is more organic for them. For us it’s back-end, hardware, networks and for them — GUI, advanced analytics, interaction with clients. Time will tell what we can do together.

Our FIX API is a great fit for many hedge funds and index providers. Based on growing demand, we decided to extend the tradeable instruments lists by adding altcoins besides ETH and BTC.

XTRD is also exploring the possibility to become a solutions vendor for exchanges by providing managed colocation services, security, and building required software components such as FIX gateways. Stay tuned for updates.

Based on conversations with our clients and potential partners, we built the following road-map of additional routing destinations: OKEx, Bittrex, and Binance.

To increase awareness of our project and attract more clients, partners, and new community members, XTRD will participate in series of events such as Blockchain Futurist Conference (Toronto, Canada, August 14 -16, 2018), The Trading Show 2018 (New York, USA, September 26, 2018), and Blockchain Shift (Miami, USA, October 11–12, 2018). Feel free to stop by our exhibition booths and say “hello” or ask tough questions during roundtables.

We would like to share what was done on the technical side in the last several months.

Hardware and Point of Presence

As a relatively complex software/hardware project, we heavily invested our resources in building infrastructure — point of presence in NY4, network, and switches/servers. Right now XTRD is listed in the Equinix Marketplace so shortly clients will have an option to order our services within the NY4 datacenter, one of the biggest hubs in finance (more locations are coming in the nearest future).

Available cross-connectivity options will be 1/10 Gbps, for colocation we are happy to offer fully managed services for 1U, 2U, and 4U machines. We have ordered around $100,000 USD worth of equipment to be installed this month at NY4.

Software Components

Our engineering team also did not leave software components behind.

Our first product — FIX API is currently up and being heavily tested by several early adopters. Based on the standard FIX 4.4 specification, our gateway allows users to trade and receive market data from the following exchanges:

• CEX.IO
• Gemini
• Bitfinex
• HitBTC
• BitStamp

FIX Messaging

In terms of messaging, we are providing the “must have” set:

• NewOrderSingle(35=D)
• OrderCancelRequest(35=F)
• OrderCancelReplaceRequest(35=G)
• OrderStatusRequest(35=H)
• RequestForPositions(35=AN)

Using these messages, clients can easily integrate their crypto portfolios into existing OMSs (Order Entry Systems).

Right now the FIX gateway supports two orders types

• Limit(40=1)
• Market(40=2)

A full spec will be New messages and more advanced orders types will be added next month.

Market Data

Market data will be streamed using the combination of:

• MarketDataSnapshotFullRefresh(35=W)
• MarketDataIncrementatlRefresh(35=X)

messages.

We know that many exchanges simply don’t have delta updates so our system will manage all books internally. So instead of receiving full book snapshots (what is super inefficient but kind of standard for crypto) clients will receive only actual changes. We’ve been in this business for a decade and know how to build reliable and efficient market data management systems.

The XTRD team will continue to publish regular technical updates to keep our community apprised of progress in product and expansion.