On July 26th, we spoke with the Branding Director of OnTrade, Tracy Lin onsite of Cointime Summit 2019 · Vietnam Station Organized by Jinse.com and The Blockchainer to learn more about ECN of OnTrade Exchange.
Q: Hi Tracy, could you tell us what is ECN all about?
A: Yes, the full name of ECN is actually called Electronic Communications Network. It is one of the projects from OnTrade Alliance Exchange. Based on the technical accumulation of the OnTrade’s team in the top traditional exchange for more than ten years, OnTrade carries out the output of financing product, transaction and risk control & settlement. Therefore, OnTrade can help other exchanges takes 0 costs to build a derivatives trading system.
Q: I wonder what was the intention of the ECN plan and what problems have ECN solved at the moment?
A: During the early days of the cryptocurrency market research, OnTrade team found that many exchanges do not have financial derivatives but only with spot transactions. However, Investors in the 18-year bear market of traditional finance have seen derivatives are a necessary hedging tool in the cryptocurrency market. There are a lot of cryptocurrency exchanges, but they do not have relevant professional talents and technical reserves. If they develop separately, the first is that the development cycle is very long and followed by extra investment and risk.
In response to the imbalance between supply and demand, OnTrade can provide financial derivatives and traditional financial hedging tools to our client. The product has been polished in the traditional financial market for more than ten years to help them better serve their customers.
Q: Could you share with us about why should customer chooses ECN and its feature and also the advantage of ECN？
A: In the above, we talked about the risks and dilemmas of developing financial derivatives for many cryptocurrency exchanges. We launched the ECN project to reduce risks and overcome challenges and obstacles.
First, the ECN project’s online exchange does not require core or sophisticated technology to access, just integration, and it will work. Thus, for our partners, their development cycle is short, but the product goes online fast. Secondly, OnTrade has contained a lot of financial, technical talents in the traditional commercial field. Our partners do not need to care about system iteration. It only needs to negotiate with OnTrade.
Second, the current ECN service that accesses OnTrade is in the promotion stage, thus no additional charge and additional access fees, all cost is 0. However, the possibility of late-charging is not ruled out. OnTrade will not unilaterally interrupt the services already in the cooperative exchange due to late-charging. In a word, the first arrived the first earned.
Third, in addition to trading, risk control, and settlement services, OnTrade will not be exposed to any private information of customers from our partners to other, OnTrade fully respect the privacy of users.
Fourth, OnTrade will not force the technical patent statement made by our partners. OnTrade will not disclose the information of exchanges that have been cooperated without the consent of the alliance exchange to the outside world. Guarantee the brand effect of our partners.
Fifth, it is also a vital key to the ECN project. The ECN project will make the transactions of each exchange on the same matching engine, which means that all customers of the ECN-connected exchange can share the liquidity and trading depth. Breaking the Matthew effect in the exchange industry, allows all the isolated exchanges to form a community on the trading business, thereby improving the customer trading experience.
Q: So why do believe the customer will choose OnTrade? Are there any advantages of OnTrade?
A: This question is excellent. Although there are a few exchanges with similar cooperation modes, we do not deny the effectiveness of other exchange-like ECN models, which just proves the just-in-time need for ECN-like models. I briefly state the advantages of OnTrade’s ECN model now.
First, high-speed security, OnTrade trading system is comparable to the traditional financial system in the aspect of speed, including network delay, data serialization delay, transmission delay, queuing delay, protocol delay, operating system delay, application delay. There are seven dimensions from the communication hardware integration. Thus, the microsecond response rate is reached in all aspects of the program algorithm. It is very friendly to quantitative and high-frequency trading. The OnTrade trading system also uses redundant design for key application components. All key nodes of the trading system are backed up. When an error occurs, the system can be switched quickly and smoothly without affecting the operation of the system. Transaction data can be accurately replayed so that ensuring the security of crucial system data and the functions of publishing operational logs and information tracking. When designing the API interface and the human-machine interface, an error detection and error correction mechanism is introduced for the critical input information.
Q: Wonderful, I mean how could we access ECN? And if I want to get the access, what do I need to do to first?
A: We have three access modes: API integrated mode; SAAS integrated mode; and the whole system mode. For exchanges that want OnTrade to provide all technical services except front-end, API integrated mode can be used, and SAAS integrated mode can be used for exchanges that wish to directly access the front-end and the back-end. For exchanges with smaller volumes, we can even provide the integration to the entire system at the front and rear.
whatever of the access mode, it will be subject to multi-level risk management in the OnTrade system and business, so that ensure all customers are protected by the most standard and regulated risk controls system.
Q: Tracy, tell us more about what is the progress of the ECN project now?
A: Since March till today, dozens of exchanges have been communicated and have corporate intentions. We have completed ECN access for many exchanges.
Q: OK, one last question, what’s the next step in the ECN project and what your vision of ECN’s?
A: The vision of the ECN project is to empower financial derivatives for at least 100 exchanges, and to conduct unified traditional financial system-level transactions, risk control, and settlement. ECN going to set an industry benchmark and builds a new ecosystem of cryptocurrency exchanges.
OnTrade is the fourth generation of innovative all-financial product digital asset exchange. Its team members were from leading financial institutions such as Morgan Stanley, JP Morgan Chase, Kraken, Huobi, China Financial Future Exchange (CFFEX), Industrial Securities Co. Ltd. and more. Building on the team’s decades of technical accumulation and industry experience in traditional top exchanges, ECN (the OnTrade Electronic Communications Network), an Alliance Exchange Program featured by OnTrade, provides trading matching, liquidity sharing, risk control and settlement services of derivative products for the digital asset exchange industry. OnTrade opens up all of its derivative products to partners for deep sharing of the liquidity provided.