Trading Technology Solutions: Interview with Ryan Hansen, Head of Sales at Mercury Digital Assets
By Edlyn Cardoza
Trading software facilitates the analysis and trading of financial products like currencies, options, stocks, or futures. There is an array of trading software packages available at every level of trade experience and tailored to different markets.
Because of falling commission costs, traders and investors have moved to do some of their trading and analysis using self-directed trading accounts. This has led to an increase in the demand for software that offers analysis, information, and trading capabilities within the software.
Mercury Digital Assets provides high-performance trading technology solutions for spot crypto and crypto derivatives products to exchanges, OTC desks, professional trading groups, asset managers, banks, and custodians. The crypto asset world is competitive and fast-moving, and Mercury delivers solutions and support to help you boldly capture market share and capitalize on opportunities to grow your business. Their solutions amplify your digital asset business.
IBS Intelligence sat down with Ryan Hansen, Head of Sales at Mercury Digital Assets, to discuss in detail trading technology solutions.
Could you give an overview of your service offering and client base?
• OTC Trading Platform
We have built an automated OTC trading solution that allows sell-side firms to upgrade from manually managing OTC deals via public instant messengers and voice brokering to offer a 24/7 electronic platform to streamline & automate various workflows, including trading directly with liquidity providers, conducting pre-trade buying power checks, connecting into third-party custodians and settlement networks, and more.
Features include being able to apply bid-ask spread markups to different client groups so clients can see prices tailored to their business, incorporating OTC limit order support in addition to RFQ workflows, automated FX hedging for dealing with customers in non-USD pairs while trading with liquidity providers in USD for better execution and faster settlement, and more. We have gotten a lot of traction on this product, so we continue to build out the feature set with things like support for OTC derivatives in addition to spot products, best execution across multiple liquidity providers, and more.
We have delivered this solution as a standalone white label for web & mobile, embedded into clients’ existing platforms to sit alongside other asset classes like stocks, FX, and futures, and as an API solution where the client owns all of the end client-facing elements and taps our API suite to run things behind the scenes.
Client types include OTC desks, broker-dealers, banks, exchanges, crypto ATMs, and others that run riskless principal or agency models trading on the backend with top liquidity providers like B2C2, Wintermute, Cumberland, FTX OTC, DV Chain, and others. We have also delivered single-dealer platforms to leading market makers in the crypto market who act as the sole liquidity provider to their clients.
• Order and Execution Management Platform
We have built an order & execution management system (OEMS) that professional traders can use to trade crypto options, futures, and perpetual swaps in exchange order books and RFQ offscreen liquidity for block trades and to trade spot products at multiple exchanges and with OTC liquidity providers.
We provide traders with features that go beyond exchange & liquidity provider-supported platforms, including being able to pipe in proprietary data such as theoretical prices and custom greeks, deploying execution algorithms, and more.
Multiple sell-side workflows are available, including brokers being able to trade in an agency capacity providing execution services, matching buyers & sellers & sending the cross-trade to an exchange to be settled if they have both sides of the trade, finding liquidity in our RFQ network to match with their buy or sell order if they only have one side of the trade, and trading as principal to the trade while providing brokering services to clients.
We are currently rolling out a set of execution algorithms that will allow customers to find lit and dark liquidity more efficiently, execute multi-leg orders while minimizing price impact, and trade efficiently across exchange and OTC venues.
This solution is available for point & click traders in our BEACON platform and via FIX API for clients that want to automate things on their end or integrate into other systems.
Clients include buy-side participants, including crypto funds & asset managers and prop trading groups, and sell-side firms that trade on behalf of customers, need to hedge using exchange-traded products or create structured products and OTC derivatives.
How has technology helped Mercury Digital Assets in trading?
Automating repeatable processes and workflows allows our clients to scale their businesses more efficiently while lowering the risk of errors and minimizing costs. Since crypto is a truly global market that operates 24/7, clients need to have their business online and fully operational at all times, which is tremendously difficult to do without leveraging technology. Mercury’s investment in building robust and reliable trading systems gives our clients the peace of mind that their trading activities are well supported, allowing them to focus on things like growing their business and gaining more key business objectives rather than developing and supporting trading infrastructure.
Recently, Mercury Digital Assets had announced its partnership with Wintermute. What does this development mean for Mercury Digital Assets?
Mercury’s clients get access to one of the top-liquidity providers in the crypto space, which means great pricing of crypto assets and deep liquidity to buy and sell at small and large sizes whenever they need to do transactions. Wintermute provides liquidity with a large number of coins and tokens, with over 20,000 trading pairs available and growing all the time, so clients can trade with one counterparty where they may need to maintain multiple relationships with other liquidity providers who don’t have as broad of coverage.
The combination of Mercury’s institutional-grade technology and Wintermute’s first-rate liquidity delivers a dependable solution for trading the crypto markets that our clients can easily plug into their business and have peace of mind knowing expert partners are powering the solution.
What makes Mercury Digital Assets unique from other existing players in the market?
Mercury’s team has a profound amount of experience in providing trading technology in traditional capital markets and has been operating in crypto for 4 years, so we have a great understanding of what works well in traditional markets, how crypto markets work, and what can be combined from both worlds to deliver unique value.
Our focus on providing the automated OTC platform that sell-side participants can flexibly incorporate into their business and customize to deliver a unique offering to the end client has separated us in the marketplace. Crypto has historically been somewhat flat, allowing for peer-to-peer transactions and traders to go directly to exchanges without an intermediary, which differs from how stocks, futures, and other markets function. Having a product that allows broker-dealers, agents, and fintech platforms to offer crypto to their clients and shape their value proposition according to whatever their core business may have been a big winner for us and something different from what others are doing in the market.
According to you, what will be the future of trading technology solutions?
We see the market growing significantly from here and that expectations for systems to become more high-performing and reliable to grow, so we focus on building high capacity and low latency things.
We also see an expansion of the crypto derivatives market in particular, with demand for more venues in different regions of the world with the ability to trade ever-sophisticated strategies. Our team has built technology for traditional options exchanges, which have a high threshold for trading tech in terms of capabilities and reliability, so we welcome crypto exchange partners who have the vision for adding things like a complex order book, contract fungibility and more that will expand the market participation and grow both liquidity and trading volumes.
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