Nasdaq, Morgan Stanley Trading Vets Build Startup to Unite Crypto Market Price Ranges
A group of trading vets from NASDAQ, Visa and Morgan Stanley say theyâ€™ve built a liquidity solution for the worldâ€™s disparate cryptocurrency markets.Â
After 18 months of development, their project, Apifiny, came out of stealth Wednesday with a new platform targeting exchanges hampered by low liquidity: ExOne. It is an emerging finances back-end tool tied to technological advances in traditional markets, which, despite their off-chain standing, have myriad advantages over crypto exchanges.
â€œThese marketplaces are highly fragmented and remarkably inefficient,â€� said Co-Chairman David Wield, a former vice chair of NASDAQ. â€œIf an investor goes to one marketplace the bid that he sees in that one marketplace may be wildly different than it is in another venue.â€�
Bid discrepancies can be a turn-off for investors used to accessing relatively stable quotes from a consolidated marketplace, Weild said . Bitcoin and other cryptocurrencies have no such price coherence; real-time bids can vary by thousands of dollars from one market to the next.
â€œIf your pipes, so to speak, donâ€™t see both venues, then you’re going to have a risk of getting a much worse execution,â€� Weild said.
ExOne wants to lay those proverbial pipes. Built by Apfiny’s 100-plus team out of San Francisco and a handful of distributed offices, it’s the plumbing to a more interconnected, consolidated trading experience. Its executives include CTO Ashu Swami, former VP of Program trading at Morgan Stanley; Head of Product Connie Wong, former Design Lead at Kraken, and CEO of Retail Product Ben Rab, formerly Visaâ€™s head of Global Network Product Support.
As Weild explained it, ExOne will reach across the marketplaces to generate a consolidated quote, a â€œglobal best bid and offerâ€� that secures the most optimal bid for the systemâ€™s users.
Thatâ€™s similar to the â€œnational best bid and offer,â€� a Wall street term referring to a brokerâ€™s Security and Exchange Commission-mandated responsibility to get their clients the best possible price.Â Â Â
And though ExOne provides a service for crypto, Weild, who couched his explanation of ExOne and digital assets at large with the language of a Wall Street trading desk, said the platformâ€™s utility has precedence in the traditional markets.
In the U.S., the SECâ€™s â€œRegulation NMSâ€� pushed equity marketplaces to link together in a network of pooled quotes. The idea there was to partly to modernize the countryâ€™s disparate, electronic marketplaces in a single, accessible way.
â€œThis is what weâ€™re looking to do in the digital asset space, broadly defined and globally,â€� Weild said.
ExOne is not yet operational; Apifiny has not yet announced a release date.
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