Exclusive: Fastmatch Lauches Dark Trading Venue Midmatch, Cuts Fees

Dark trading venue aimed at non-bank market makers and liquidity providers.

Fastmatch, the Electronic Communications Network (ECN) for foreign exchange trading, has launched a new dark trading venue called Midmatch, Finance Magnates has confirmed with the company’s CEO Dmitri Galinov. The firm is introducing the new mid-point dark pool to address the needs of specific clients that are willing to exchange their inventory without moving the market.

Midmatch has a 3ms speed bump in order to disqualify the advantages that ultra-high frequency shops have.

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Commenting to Finance Magnates, Galinov said: “We have introduced a speed bump in order to equalize the participants’ speed difference from an IT perspective. Nowadays the difference between clients that have spent a substantial amount of money on IT and those who haven’t is about 3 ms.”

Midmatch is aiming to fill a gap that was left wide open by BGC that is not accepting non-bank clients to its dark venue.

Midmatch was created to facilitate the inventory exchange for non-bank market makers and to fill this market gap. Given that non-banks have become big participants in the FX market, Fastmatch has identified an opportunity in this area and is introducing the venue at a very low cost of $1 per million.

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Commenting on the rules, Galinov said: “Once clients participate on Midmatch, they have to trade with everybody on the venue. This contrasts with Fastmatch where clients can choose which counter parties to trade with.”

“Midmatch also has different execution logic. Fastmatch is using a central limit order book with price-to-size priority to execute firm orders, while Midmatch operates on a price-to-time priority,” the CEO of the company explained.

Fastmatch Fees Changes

Fastmatch has also updated pricing on certain products and is introducing algos that are now included in the company’s pricing schedule. There is also free brokerage trading for retail FX that is subject to evaluation by the company.

It also introduced a new tier of $2 per million for clients that trade more than 10% of the total volume transacted via Fastmatch.

“We are trying to encourage more people to switch to Fastmatch so we have updated our fee schedule, announcing some price cuts. We are a firm believer in no last look and we are giving an economic incentive for clients who post firm liquidity,” Galinov explains.

The update takes effect on the 1st of February 2017. Fastmatch continues its aggressive expansion around the globe with a new office in Singapore. The company announced on Monday that it on-boarded Trent Beacroft from Hotspot to lead the firm’s presence in Asia.

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