Exclusive: Exness CCO Damian Bunce on FX volumes, misunderstandings, and crypto
The FinanceFeeds interview with Damian Bunce provides a clearer understanding of what’s behind the extremely high trading volumes at Exness, as well as an idea of where the FX broker is headed.
Exness is all over the news. Word about the largest retail multi-asset broker by monthly trading volume is spreading across the globe among mas media, FX industry outlets, and affiliates.
That’s not by chance. Exness is undergoing mass expansion with a well-orchestrated marketing strategy as the FX broker continues to print new monthly volume record highs, now near the $4 trillion mark.
In a recent interview with Brazilian news outlet G7, Exness Chief Customer Officer Damian Bunce noted that the global retail FX market trades $1 trillion per day, with Exness processing $150 billion/day – an astonishing 15%.
Somehow, it doesn’t seem that Exness is satisfied with those numbers. Leveraging its core technology, brand, world-class HR, and marketing, the broker is pursuing further geographical and product expansion, with a recent license in Kenya, South Africa, and Jordan, and integration of Crossover’s crypto-only ECN, CrossX.
FinanceFeeds had the opportunity to sit down with the same Damian Bunce to discuss his role at Exness, the next growth phase, the technology stack, geographical expansion, crypto, and to clarify misunderstandings.
After two years managing the trading department at Exness, you’ve been appointed Chief Customer Officer. What is your mandate and what are the challenges in this role?
Yes, during the last two and a half years our business went stratospheric, growing 500% in trading volumes. Since joining, my management focus was always on the challenges of mass expansion, new products, strong personnel cultures, and enterprise structures. We’ve now entered the next growth phase characterized by consolidation, strengthening our protection measures, more quantitative improvements to pricing, and with this phase opportunity for new blood in the trading department, and a change of roles for me after a very busy period.
I enjoy ‘external-facing’ activities, whether with clients, the media, public speaking engagements, or conferences: many people fear public speaking but I get energy from it. Now that we’re a very large company, managing our external brand is critical, as the bigger we get the more we are noticed. As CCO and the company spokesperson, my role acts as an information bridge between internal and external, with the ultimate goal to accelerate developing global credibility for our company and magnify our values.
Having run the engine room, I’m well-positioned to talk about it. My core performance indicators are linked to Exness’ share of voice and share of reach in the industry. Our brand value plays a crucial role in determining the opportunities open to Exness over the next decade. By partnering with the media, representing Exness at public forums, and being vocal on material industry matters, with frequent open dialogue, we build trust, and that is a key long-term asset in any client business.
The challenges are working against the negative press, complaints, misunderstandings, and having to develop a fresher narrative for the role and benefits of the market maker in the retail ecosystem. Of course, it’s also a challenge to develop content that’s engaging and to strike a clear balance between disclosing exciting internal insights and jeopardizing any of our intellectual property.
What is the Exness customer-centric value proposition and its trading engine?
The ‘trading engine’ is a term we use to describe our core execution and pricing technology stack. It powers the entire company and is the reason we can process withdrawals instantly, fast partner and affiliate payouts, because all risk management checks are embedded within this stack at the point of trade, not post-trade. Our core execution technology is proprietary, backed by the expertise of a strong C++ development team. You can imagine when executing 300 million orders per month, that when we build products – particularly products that provide capital to clients – we need to embed complex safeguards to prevent trading abuse.
Our customer-centric value proposition is essentially two-fold. First, we do not outsource client services, we pay a premium to train internal staff on the Exness culture and product and we speak to our clients in their native languages.
All our staff are highly trained. Some undertake a month of intense training before talking to their first customer. This is a large investment for the company but it keeps our standards high.
Second, to keep up the speed of resolution we build teams that can handle the massive throughput of chats, calls, etc., and deal with tasks in a reasonable time frame. We have an intra-day technology tool built to make immediate financial calculations and credit-to-client balances. It’s imperative we do this before customers ask, and it really is a unique proposition. In addition to industry-leading CRM solutions, our service teams have access to markets and pricing tools, to drill down to the level of detail in our liquidity pool needed, to help with clients’ queries.
Exness keeps breaking new trading volume records, currently smashing the 3 trillion USD/month barrier. What are the advantages of trading with leverage higher than 50:1, the highest allowed in tier-1 jurisdictions?
Exness’ average trade size is in fact in line with all market participants, and if you look at the official and audited published stats from all brokers produced by Finance Magnates QIR report, you’ll see that our size reflects that we have many more active traders than our competitors and that we tap into the active community better than most because our products are a better fit. Our overall proposition drives our size, not one specific service.
Regardless, clients all over the world, in both developed and developing markets, have always wanted access to greater levels of leverage than those offered in some developed jurisdictions. Indeed, in the pursuit of leverage, clients are willing to contract with offshore entities. Here the perceived risk to their assets is negated: deposit levels are much lower, so risk with the broker is also lower. Contrary to popular understanding, many retail clients are fully aware of the risks of high leverage and potential for losses, and our target demographic in particular are skilled practitioners, many trading for a living.
We observe many clients trading the same instrument with different strategies on different accounts and different levels of leverage, often using a stop loss as a trigger for a broader, more conservative strategy. Also, while we do have a small percentage of clientele trading at very high leverage levels, the average is in fact much lower across all clients. Our levels fluctuate depending on the time of day and market events – we offer the highest leverage during continuous trading when markets are at their most predictable and the chance of liquidation is at its lowest.
Leverage levels were introduced to help less-informed retail clients manage losses, but what’s less well-known is that the regulation also brought about negative balance protection, which guarantees that clients can never go negative despite an ability to open large positions. So brokers that provide high levels of leverage also bear a substantial risk of losses themselves, therefore it’s not a service free of problems.
You’ve recently opened an office in Uruguay, obtained a license in Jordan, and are now licensed in South Africa and Kenya. How do you plan to roll out such ambitious geographic expansion?
Our executive team evaluates where we want to expand (or contract) and together with our researchers we analyze markets and opportunities, and our ability to dominate that market. Once we have assessed the opportunity, we define the go-to-market plan and execute it. Our chief business development officer evaluates the effectiveness of either scaling or exiting markets, including decisions linked to licensing structures. We have a model which we know works well, with the flexibility to develop some regions as ‘start-ups’. We know that new markets operate differently from ‘established’ ones, and have the cultural awareness needed to grow partnerships.
As I mentioned earlier, we are also always mindful to ensure local language and culture are embedded in our practices – it’s almost impossible to imagine success without this. How you serve clients, market products, deal with complaints, and what products look like are all completely tied to local markets, and we do this exceptionally well.
Exness is already well positioned within the cryptocurrency trading space. What steps will you take next in regard to crypto?
We plan to extend our payment capabilities and are deeply involved in building our regulatory structure for crypto right now, but it’s too early to discuss details. On trading, we decided to de-list some of the coins we make market for, when the U.S Securities and Exchange Commission (SEC) took action to classify some as securities. But of course, where we can and when it makes sense, we will increase this list.
We’re always evaluating our pricing and trading conditions to stay on top of the market. Our crypto volumes remain robust and in fact, we recorded our highest levels to date in April this year. We know that the crypto community trades from an order-book view of the world, so there are some visual ergonomics we need to build to accommodate this community. Our services and pricing are already highly competitive.
Will the SEC’s aggressive behavior against crypto, namely the lawsuits against Binance and Coinbase, ultimately benefit the crypto industry outside the U.S.? If so, can Exness take advantage of that?
The crypto industry appears to be polarized right now, particularly in the US. On the one hand, we have perceived anti-crypto rhetoric coming from the SEC with its actions against Coinbase and Binance. But on the other hand, we have a massive institutional focus on crypto, with both Blackrock’s and Fidelity’s spot bitcoin ETF filings and the recent launch of EDX exchange powered by Virtu and Citadel etc.
In the EU, the Markets in Crypto Assets (MiCA) regulation is now in force, and in the UK, the Financial Services and Markets Act is now enshrined in law; Hong Kong legalized crypto for retail in June this year, so crypto regulation is in good shape in some major parts of the world.
We believe in the underlying technology and opportunity, and as such, it remains a core component of our strategy. How we tackle the regulatory landscape will of course depend on how it evolves. For many months now our dedicated government affairs team has been analyzing what the best structures are for us to conduct business. For now, we will follow a number of routes until we can determine the best one.
As far as industry regulation is concerned, the various authorities would do well to ensure clarity within their frameworks, so that participants in cryptocurrencies don’t inadvertently put other parts of their businesses at risk.