LMAX expands APAC infrastructure ahead of NDF offering

Rick Steves

“Our Singapore matching engine brings us closer to clients in the region and since launch we have seen 3x growth in our FX trading volumes month on month.”

LMAX Group is expanding its global technology infrastructure in Asia Pacific following the launch of a matching engine in the Equinix IBX Data Centre in Singapore (SG1).

This is the latest infrastructure investment to ensure efficient price discovery and consistent, low latency execution for global customers of the operator of institutional exchanges for trading FX and digital assets.

LMAX eyes APAC corridor between its twin hubs TY3 and SG1

SG1 is the fourth matching engine run by LMAX Group. It has gone live earlier this year and it is intended to bring greater access for clients to deep regional institutional liquidity and the ability to trade on a Central Limit Order Book (CLOB) with streaming real-time, firm limit order liquidity from top tier global banks and non-banks.

It was in 2014 that LMAX entered the Asia Pacific by launching a matching engine in Tokyo, TY3. In 2015, the group opened its regional hub in Singapore.

The addition of SG1 to its infrastructure footprint builds regional liquidity and adds significant value for the local financial ecosystem. LMAX Group sees further potential to enhance market access to this institutional liquidity by establishing an Asia Pacific corridor between its twin hubs (TY3 and SG1).

LMAX plans NDFs in Q1 ’23, Digital and Broker offering in Q2 ’23

According to the firm, SG1 has already gained significant traction locally and has a strong pipeline of institutional customers looking to onboard, including banks, proprietary trading firms, brokerages and asset managers.

LMAX Group offers spot FX trading in SG1 but intends to bring its global trading capabilities to the region through an expanded range of products, including non-deliverable forwards (NDFs) in early 2023, subject to obtaining a Recognised Market Operator (RMO) license from the MAS.

Also subject to the Singapore regulator’s approval, LMAX plans to extend its global Digital and Broker offering to the wider Asia Pacific region from Singapore in Q2 2023.

Unique multi-asset liquidity offering

David Mercer, CEO of LMAX Group, said: “Singapore is the largest FX trading centre in Asia Pacific and a major FX centre globally. We recognise the strong demand for deep institutional liquidity and transparent, efficient price discovery that the CLOB execution model delivers to market participants in the region. Furthermore, we have seen considerable growth in trading volumes in our TY3- based exchange, with increasing participation from both global and local financial institutions. Over time, we aim to establish a unique multi-asset liquidity offering for the region, combining our capabilities, distribution and infrastructure across both Japan and Singapore to benefit our global customer base.”

Quentin Miller, Managing Director, Asia Pacific, at LMAX Group, commented: “Our Singapore matching engine brings us closer to clients in the region and since launch we have seen 3x growth in our FX trading volumes month on month. We are excited by the opportunities that lie ahead and are focused on building our presence in APAC, delivering a competitive range of products and services to meet the increasing needs of institutions locally.”

Lim Cheng Khai, Executive Director, Financial Markets Development Department, Monetary Authority of Singapore (MAS), added: “We welcome the launch of LMAX Group’s matching engine in SG1 to deepen the liquidity of the FX market in Singapore and support the needs of market participants in the region. Singapore has cemented our position as the third largest global FX centre, and LMAX Group will be a significant addition to the attractiveness and vibrancy of our FX ecosystem.”

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