SFOX launches crypto trading for hedge funds with free TCA

Rick Steves

TCA capabilities enable Funds to meet and implement best price execution requirements.

SFOX (San Francisco Open Exchange) has introduced a cryptocurrency trading product built specifically for hedge funds and asset managers.

The exchange operator claims it is the first-ever crypto product addressed to such institutions, which will benefit from capabilities previously only accessible by the market’s largest firms.

“As a former hedge fund manager, I can say that the platform we are introducing today is a total game-changer for funds that are either in crypto today or just beginning to embrace crypto trading”.

SFOX states that hedge funds will be able to execute sophisticated trading strategies at scale, with best price execution through deep global liquidity, advanced order types and execution algorithms, treasury management, and detailed trade analytics with flexible settlement.

The cryptocurrency venue provides access to major trading platforms, including major exchanges, OTC brokers, and market makers. This gives hedge funds an edge across the highest priority trading areas: better pricing, enhanced access, and security.

“Just as Amazon became the marketplace for buying from many stores and sellers at a single location, SFOX is creating a similar marketplace for crypto”, the firm stated, adding that its aggregated liquidity of crypto “is so vast that a single $50 million trade of bitcoin would execute in milliseconds without moving the market – 10x more than any exchange”.

SFOX also offers more than a dozen plug and play order types and execution algorithms to provide traders with complete control over how passively or aggressively they execute and how much information they are giving to the market, as well as risk management.

Chamath Palihapitiya, Founder and CEO of Social Capital, said: “This first of its kind crypto trading platform is the right product at the right time as institutions of all kinds are rapidly transitioning to investing in digital currencies. The technical superiority and unmatched cryptocurrency liquidity at SFOX will bring the hedge fund industry the trading, reporting, and compliance services institutions need to embrace cryptocurrency as a new asset class.”

Jackson Finio, Head of Product at SFOX, commented: “As a former hedge fund manager, I can say that the platform we are introducing today is a total game-changer for funds that are either in crypto today or just beginning to embrace crypto trading. Hedge fund managers can focus on what they do best, trading, without having to worry about execution, scalability, capital efficiency, or any of their back-office reporting and operational requirements.”

The firm is introducing a proprietary Trade Cost Analysis (TCA) program integrated into its crypto trading platform and at no additional cost.

TCA capabilities enable Funds to meet and implement best price execution requirements in crypto. That way they can demonstrate to clients and regulators that they are making their best effort to acquire assets for clients at the best price.

Akbar Thobhani, CEO and Co-Founder of SFOX, said: “We’ve built a platform that gives any hedge fund access to all the same tools and resources previously only accessible and available to the most well-resourced trading firms in the world and at no to low cost.

“We know that running a fund is hard. When a market and regulatory environment are already fragmented and constantly changing, it makes running a crypto fund even harder. We want to be an ally to every hedge fund embracing cryptocurrency investing and trading.”

SFOX has found that hedge funds are its fastest-growing trading segment: 18x increase in trading volume year over year and a 10x increase in the average volume per customer over the past year.

Settlement options – including Instant Settlement for pre-funded transactions and Post Trade Settlement (PTS) – are also offered by the venue.

SFOX grants lines of credit so that hedge funds can avoid pre-funding. Market participants then are able to settle any outstanding amounts flexibly on a timeframe that suits a trader’s needs.

SFOX is committed to defragment and professionalize cryptocurrency trading hedge funds by putting all operational capabilities in a single platform.

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