The first wave of gen-AI use cases across capital markets technology has sparked widespread energy and excitement about its future potential. At the same time, it has triggered a sense of urgency across infrastructure providers globally that they must act now to avoid being left behind.

Market operators face two critical questions today. Firstly, what is the right operating model and the critical capabilities they want to develop and maintain in-house or source from external providers? And secondly, how do they ensure that they will have access to these advanced capabilities, given the extraordinary level of energy and compute capacity that will be required to power their markets in the future?

If we look ahead to capital markets over the next two decades, the future of trading infrastructure will be built on a fabric of interconnected markets with a common data architecture, seamless connectivity throughout the ecosystem of exchanges and participants, minimal latency, and advanced AI-powered tooling.

Operators don’t have long to embark on their data and tech modernisation journey to get there, and we’re proud to be supporting so many of our infrastructure clients on this path. 

Gideon Mann, global head of AI technology, Millennium 

What was cutting-edge generative AI (GenAI) in early 2024 will look outdated over the next twelve months. Successful organisations will adopt a long-term GenAI strategy, balancing immediate applications with the flexibility to adapt to future innovations in this space.  

In the investment management sector, the diversity of challenges allows us to identify some of the most promising applications of GenAI. These are likely to result from a collaborative approach between technologists and their end users including investment professionals, legal, compliance and finance teams, among others. We have seen early applications of GenAI in the areas of market observability, risk assessment and operational efficiency. In 2025, organisations will be looking to scale the use cases that have shown the greatest potential. 

Jamil Jiva, global head of asset management, Linedata 

As we leave 2024 behind, artificial intelligence is set to transform industry practices. From risk management and regulatory compliance to predictive analytics and cybersecurity, AI promises to bring a new era of transparency, efficiency and innovation to the finance ecosystem. 

The widespread adoption of Explainable Artificial Intelligence (XAI) in risk assessment and management systems marks a decisive turning point. This technology is finally lifting the veil on the ‘black box’ of algorithms behind AI inference systems, offering a clear understanding of AI decision-making processes. This creates an opportunity for financial institutions to renew and reinforce the confidence of customers and regulators while improving the accuracy of their risk models. 

Nick Wood, AI product manager, FINBOURNE  

While AI clearly has the potential to enhance operating margins and reshape the asset management industry, serious adoption remains slow. This hold up is largely due to a lack of confidence in the incumbent data management processes, which need to be designed to support AI technologies.

While AI can certainly act as a feature and capability in an overall workflow, firms must be able to explain the models and trust the quality of the underlying data to get there. With AI showing so much promise, prioritising modern data infrastructures to address data quality concerns will be a priority for many asset managers next year. 

Jim Kwiatkowski, chief executive, LTX (a Broadridge company) 

This year, the fixed-income market experienced notable advancements, with credit market volumes reaching an average daily volume of $49.8 billion, reflecting a 23% year-over-year increase. This growth is projected to continue into 2025, fuelled by a steady increase of credit e-trading. 

Looking ahead, AI is poised to play a pivotal role in bond trading, transforming how fixed-income traders, analysts and portfolio managers process and leverage the growing volume of data from electronic trading. By enabling streamlined access to vast, disparate datasets, AI enhances decision-making in areas like bond selection, trade list construction and protocol optimisation. As AI adoption scales, the market can expect a more vibrant secondary trading environment characterised by improved pricing, enhanced liquidity, and stronger overall performance. 

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The race to redefine FX trading is on. According to the recent Coalition Greenwich report, multi-dealer platforms (MDPs) are poised to overtake single-dealer platforms (SDPs) in spot FX trading in 2025 – a stark reversal of recent years where SDPs dominated. 

Amid these changes, banks need to adapt so they can meet their clients wherever they are and deliver on best execution requirements. To get ahead of the competition, banks need to upgrade their technology to enable faster price discovery, bespoke price creation and improved risk management. At the same time, we’re seeing more sophisticated buy-side firms utilising API first architecture to directly embed banks’ services and functionalities into their own workflows, creating new opportunities for dealers, provided they have the right technology.  

The message is clear: future success hinges on mastering MDP, SDP and API trading ecosystems. The key lies in leveraging venue-neutral, multi-channel technology to build a robust distribution platform. From there, banks can focus on delivering a unique trading experience tailored to their clients – on any platform, in any environment. 

Mark Suter, executive chair, Digital Vega 

In 2025, we expect the see the FX options market automate further, with more regional and private banks implementing workflow automation technology solutions. As their clients want to trade electronically and trade sizes reduce, many banks are having to implement technology to manage a larger volume of price requests and more tickets to process. A key focus for Digital Vega in 2025 is to continue to roll out our white label electronic platform to client banks. This increases workflow efficiency and capacity, and also allows banks to price trades themselves or source prices from our multibank platform, which enables increased currency coverage. 

Next year will also see the full production launch of our FX options CLOB. We have spent a long time developing the platform and conducting client testing but held back from a full launch until we could rely on deep liquidity on day one. Now we have most of the main trading firms connected we expect to launch in early 2025. As the CLOB makes interdealer trading more efficient we think that the whole of the FX options market will benefit from increased liquidity and overall volumes will grow as a result. 

Stephan von Massenbach, chief revenue officer, DIGITEC 

The FX swaps market is migrating to electronic channels, and we expect the pace of change to continue through 2025. Clients want to trade FX swaps in multiple currencies, and tenors beyond overnight and tom-next, and banks will only be able to service clients efficiently by implementing scalable technology solutions, where workflows are largely automated – in data, pricing, distribution, and settlement. Also, the velocity of the underlying market has increased which means that banks using Excel to manage their FX swaps books are now turning to technology solutions to keep pace. SaaS technology deployed in the cloud has reduced the investment required to provide accurate and fast FX swaps pricing. 

Interdealer FX swaps trading, which is dominated by the broker market, has begun to migrate to electronic venues, like 360T SUN and LSEG Forwards Matching. We expect more volume to migrate to electronic channels in 2025. 

David Mercer, chief executive officer, LMAX Group 

The foreign exchange (FX) market remains a cornerstone of global trade, yet its pace of innovation lags other areas of capital markets. Despite representing the lifeblood of international economies, significant portions of the market remain untouched by the latest technology and innovation. This leaves ample opportunity for modernisation through blockchain technology as we see increasing fusion between TradFi and decentralised finance.  

Simplified and automated solutions could transform FX, enhancing global price discovery and market access. Looking ahead, there is enormous potential for decentralised models to reshape FX as we know it. Tokenisation would facilitate more dynamic and transparent trading, addressing inefficiencies and increasing participation from diverse players. As sovereign nations strive to maintain control over their currencies, FX innovations can bridge the gap between national interests and meet the demand for a seamless global marketplace. 

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We’ve said it before and we’ll say it again – we’re good at people moves. So, with two big names like Citi and Citadel in the title, it was going to be hard for this one not to get your attention.

Coming in at number seven in The TRADE’s most read stories for 2024 was news that Vincent Hall had joined Citi as an equity trader following two years at Citadel where he served in the same role.

He returned to Citi after four years in September, having previously worked at the firm as associate vice president in emerging markets equity trading. Elsewhere in his career, Hall has also worked at BlackRock as an associate.

Read more: Fireside Friday with… Citi’s Chris Gooch

Earlier this year, Citi appointed Jamie Miller as new head of electronic equity sales trading for the EMEA region, as revealed by The TRADE. Miller has been with the firm eight and a half years as an employee of the bank, specialising in equity sales trading.

Now you may have noticed that this year is The TRADE’s twentieth birthday – if not then there is a strong chance you have been living under a rock because we’ve made a really big fuss over it.

As part of our year-long celebrations, The TRADE’s editorial team took it upon themselves to deep dive into our beloved industry, producing top 20 lists that explore all corners of the markets.

Among these in depth pieces and coming in at number seven this year in our most read stories is a roundup of the top 20 merger and acquisition stories from across market structure and the trading world. We pride ourselves in being a reference point for our industry with 20 years of content behind us, and these lists summarise everything you need to know in one place.

In this exquisitely detailed piece, TRADE senior reporter Claudia Preece delves into the minutiae of these landmark deals and unpacks their significant and lasting impact on the market.

There are simply too many deals to include in this roundup but if you haven’t read it yet then use the link included above. We’d recommend you make yourself a cup of something first as she’s a biggie.

5. Millennium taps UBS for new senior trader appointment

Coming in at number five and adding to the spattering of people moves included in these most read roundups was news that Millennium had appointed You Khai Tan as senior trader, based in Singapore.

As revealed by The TRADE in March, Tan joined Millennium from UBS, where he had spent the last 13 years, based in Hong Kong and Singapore.

Most recently, Tan held a global portfolio trading position, which included trading global equities with strategy implementation via algorithms, crossing networks and global portfolio trading desks.

Prior to that, Tan held a global markets, APAC cash equities position based in Singapore.

Elsewhere in his career, Tan served at Maybank Investment Banking Group in an equity sales trading role.

He announced his appointment in a social media post, adding: “I’m grateful for this opportunity to broaden my horizons and am thankful to the wonderful individuals and mentors in my professional life.”

While writing up the biggest moves from across the industry brings with it a certain degree of joy, nothing matches recognition received for a longer form piece of work that explores a corner of the markets in more depth.

A great deal of effort goes into The TRADE’s longer form content and coming in at number four in our most read stories this year was a feature exploring the world of open outcry and the potential for a renaissance of it.

Despite the indisputable decline in physical trading practices, it is enduring within an increasingly technological capital markets world which has already put innumerable out-dated practices out of fashion. Market opinion – and moves – suggest that mourning the death of open outcry may be premature.

Like the return of old Nokia’s and ‘dumbphones’ in the era of the smartphone, a hungering for print in the age of digital, and the comeback of the polaroid camera and vinyl, perhaps there’s just reason why these concepts were once deemed great.

Following the announcement from MIAX in October 2023 about plans to launch a new US options electronic exchange and physical trading floor, The TRADE wanted to delve into why open outcry has persisted and the potential for a quiet resurgence of the dying practice. If you haven’t already then absolutely give it a read.

That concludes the second roundup of The TRADE’s most read stories. Tune back in on Friday 27 December to find out what our top three most read pieces of the year have been… exciting! In the meantime, happy holidays.

The post The TRADE’s most read stories of 2024, part two: People moves, TRADE 20 roundups, and open outcry appeared first on The TRADE.

The evolution taking place in fixed income markets has laid the foundation for the recent growth in credit index futures, positioning 2025 as a pivotal year for further proliferation of the product and broad adoption by the market. Advancements we’ve seen in market infrastructure, such as the electronification of trading, real-time bond and ‘liquid’ index pricing, as well as enhanced analytics on Terminal to compute fair value and identify relative value opportunities, have transformed how buy-side firms are managing and trading credit risk. These trends will continue, enabling greater price transparency and standardisation of this market which, historically, aids in the development of exchange traded products like credit index futures. 

The existing contracts provide broad-based exposure to the European, US and emerging market corporate bond markets utilising Bloomberg’s fixed income benchmarks. In 2025, we envision an expansion of this global credit futures complex, allowing investors to target regional credit markets and specific risks such as duration, sectors, or credit quality, providing a more diverse range of tools for those seeking local exposure and precision. This will lead to increased cross-margining opportunities with correlated products, amplifying the utility and cost-effectiveness of the product. 

For global credit, we enter a year of uncertainty in 2025, with resilient corporate fundamentals and potential easing of monetary policy offset by ongoing geopolitical tensions. Investors will continue to find value in a flexible credit vehicle that can be used to deploy capital quickly, express a tactical view or hedge corporate credit exposures. The product will continue to attract a diverse range of market participants, from asset managers to insurers, looking for narrow bid-ask spreads and tight tracking to the benchmark. We expect further normalisation of credit index futures as a core instrument in credit markets.

Charlie Campbell-Johnston, head of automation, international, Tradeweb 

The last few years have thrown fixed income traders one curveball after the other, and automation has proven itself as an effective tool to deliver scalability and time efficiency across different products and through a range of trading protocols. On the other hand, systematic and cross-asset funds have used automation to create new trading activity and realise new strategies. 

The game, however, could change in 2025. A combination of technological innovation and high-quality data would enable traders to adapt their automation parameters to actual real-time market scenarios, giving them even more control over the trade execution process. After all, automation has already transcended its operational efficiency origins and this evolution would cement its hard-earned place at the core of a dynamic and innovative execution desk. 

Tucker Dona, head of business development, Baton Systems 

We are one-year away from the mandatory central clearing of US Treasuries, which is going to have a material impact on the way that firms post margin for this product. Firms wanting to offset the impact of higher margins need to spend 2025 making operational changes and upgrades to optimise their systems for trading and clearing US Treasuries. However, there is still more clarity needed on which CCPs market participants will choose to clear these products, and which model participants will use, such as sponsored or done-away. Thankfully, much of the operational preparation and workload can be done efficiently with support from vendors providing direct connectivity into the CCPs.

If firms are not able to efficiently optimise and mobilise available assets across the range of CCPs they will use for clearing US Treasuries, they are going to face operational and cost challenges. By using data-driven insights to select the most eligible and opportunistic collateral for the different clearing venues and then being able to execute all movement instructions, firms can manage the higher margin levels more effectively. They will also be able to reduce associated costs, and more efficiently manage better their collateral usage and its impact on available liquidity. 

The post The TRADE predictions series 2025: What to expect in fixed income appeared first on The TRADE.

As we bid farewell to 2024, we are left with many questions about the dawn of 2025, a year that promises to be a game-changer. We already have key milestones within the ever-fluid EMEA regulatory landscape, including DORA and implementing the Mifid II and Mifir review. We will likely witness further regulatory divergence between the UK and the EU. Still, all parties must act swiftly to address the macro-level challenges affecting primary market listings and the lack of investment in the EMEA region. It is imperative that action is taken on all fronts. 

We should finally see, on a grander scale, AI usage moving from an over-used buzzword bingo to a reality. The pursuit of innovation will persist, with new entrants needing to demonstrate credible and distinctive credentials in a highly competitive and demanding environment, where only those that offer something unique will ultimately endure.

As the industry moves towards a consolidated tape and the looming T+1 deadline, established players will likely continue positioning themselves to expand their market share or protect their existing trading, data, and technology businesses. This is set against a backdrop of rising industry costs, which will inevitably face heightened scrutiny.  Liquidity sweet spots like retail, blocks, bilateral and VWAP crossing will again dominate many liquidity discussions. The bilateral debate will likely persist, and we can expect engaging discussions from industry participants and regulators. 

Furthermore, the ‘Trump effect’ looms on the horizon; this could exacerbate market volatility in the year ahead, a reality that will soon become apparent. In 2025, we must challenge existing workflows and the status quo to innovate and compete globally. We all have a role to play in establishing the EMEA ecosystem as a model of excellence for the global trading community next year and beyond.

Steve Walsh, director of product and solutions, Duco 

This has been one of the most consequential years for financial market regulation in a decade. New compliance requirements have reshaped frameworks in Europe and across the globe. The two most important regulations were the Emir refit at the end of April and the US transition to a T+1 settlement cycle. Both regulations aim to enhance transparency and resilience. 

The Emir refit’s primary motivation was to improve data quality and transparency in the European derivative markets with mandatory data reconciliation requirements and obligations to report material issues to national competent authorities (NCAs). While the transition was largely successful, regulators next year will need to address lingering issues around data accuracy and integrity on data reported to trade repositories. 

Meanwhile in America, T+1 has created operational difficulties, highlighting data quality and transformation issues as well as poor processes and a lack of automation throughout. Resolving these issues will be relevant in Europe as well, as T+1 is expected to reach both the EU and the UK by the end of 2027. European firms need to start preparing while learning from their US peers.

Vikesh Patel, global head of clearing, and president, Cboe Clear Europe 

In 2025, we anticipate renewed regulatory efforts to promote more resilient, efficient and integrated pan-European financial infrastructures. Striking the right balance between fostering growth and innovation on one hand and maintaining regulatory oversight and financial stability on the other will be essential for advancing the region’s capital markets and we look forward to Emir 3.0 helping bring this to life. Whilst we anticipate that talk of top-down consolidation for Europe’s post-trade infrastructure is likely to persist, we will continue to advocate for strengthening the existing competitive framework, particularly in cash equities through mandating true clearing interoperability for all major exchanges.

We remain dedicated to fostering a stronger and more resilient European market by continually driving innovation and equipping participants with the tools they need to drive a more efficient use of their capital, ultimately contributing to long-term growth and stability across the region.

Matt Smith, chief executive officer, SteelEye  

Following several years marked by significant fines for record-keeping breaches related to encrypted messaging apps, we expect to see a broadening focus in 2025. E-comms will remain a regulatory focus, but so too will areas such as voice surveillance. 

Voice surveillance currently represents a big gap in many firms’ communications surveillance programmes due to ambiguous regulatory rules. However, it is likely regulators will clarify expectations around voice surveillance in 2025, and financial firms should prepare for this. 

Currently, regulatory rules do not specify how voice data should be monitored which has resulted in many financial institutions simply carrying out manual reviews of a sample of voice calls, leaving a considerable gap for missed risks.  With advancements in transcription and analytics technology, voice surveillance will move from being an overlooked channel to a critical component of risk management frameworks in 2025. 

Simon Gallagher, chief executive officer, Euronext London 

In 2025, the realities of increased competition from the US for capital and liquidity will be a wake-up call for Europe. On both sides of the channel, policy makers will accelerate measures to bridge the gap between the region’s vast, untapped household savings and its equity markets.

As part of this wider effort, Europe will need stronger and simpler market structures. Euronext will play its full role, making material contributions to simplifying Europe’s post-trade complexity, harmonising its fragmented ETF markets and leveraging our new clearing capability to unlock value for clients. In addition, following our recent push for a single, unified European prospectus, we will continue to proactively propose ‘bottom-up’ solutions to simplify European markets.

Under strong political leadership, I am optimistic that the region will be able to catch up with the US in funding innovation and infrastructure and in creating greater wealth for its citizens. 

The post The TRADE predictions series 2025: The evolving regulatory landscape appeared first on The TRADE.

Coming in at number 10 in our 2024 most read countdown was a major merger and acquisition scoop announced at the start of the year. As revealed by The TRADE and sister publication Global Custodian in February, fintech giant acquired SaaS post-trade platform Torstone Technology.

The deal will further bolster FIS’ capital markets technology offering, having acquired SunGard in a major deal back in 2015. The firm has also made waves through a number of other bolt-on acquisitions and landmark mandates.

Torstone is a global SaaS platform for post-trade securities and derivatives processing technology, originally built by and for a global investment bank. 

The fintech was founded in 2011 with originator and CEO Brian Collings still chief executive and chair today. Torstone is headquartered in London, with offices in New York, Toronto, Hong Kong, Singapore, and Tokyo.  

Speaking at the time of the deal, a spokesperson for Torstone confirmed that the firm was not able to disclose more detail at that stage. A spokesperson for FIS added that the firm as a rule does not comment on market rumour or speculation.

A source speaking to The TRADE, under the condition of anonymity, said: “The acquisition makes perfect sense from the FIS perspective as the vendor can add modern securities processing capabilities to its existing suite of capital markets focused offerings. On the Torstone side, it gives the smaller vendor deeper pockets to build out its capabilities and reach into new geographies.

The TRADE is renowned for its coverage of major people moves from across our industry and so it’s fitting that number nine this year in our most read stories is quant-focused role at Citadel.

As revealed by The TRADE following a post on his social media, Citadel appointed Mukunth Raghavan as head of American Treasury quants, based in New York, in October earlier this year.

As part of the role, Raghavan will serve a broad mandate across both Citadel Asset Management and Citadel Securities. He joins Citadel from Goldman Sachs, where he most recently served as vice president within the bank’s global equities team.

In an earlier stint at Goldman, Raghavan worked as vice president, quantitative strategies within the bank’s equities prime services. In this role he built analytical tools, trading strategies and optimisation models.

Elsewhere in his career, Raghavan spent three years at McKinsey & Company, most recently serving as a management consultant.

8. Goldman Sachs AM set to leverage BNY’s buy-side trading solution

And finally, coming in at number eight and concluding this first roundup of The TRADE’s most read series, is news relating to an outsourced trading deal involving some rather large household names.

News broke in March that BNY was set to begin offering its buy-side trading solution to Goldman Sachs Asset Management as the firm continues to expand the reach of its outsourced trading offering across the market.

The new buy-side trading relationship specifically concerns a division of Goldman Sachs Asset Management’s EMEA business, The TRADE understands.

As part of the agreement, BNY is delivering global trade execution services in EMEA, the US and APAC markets across fixed income, FX, derivatives and ETFs. 

BNY’s buy-side trading solutions business was launched in 2023, providing a flexible solution. As the firm explained, “outsourced trading does not have to be a onesize fits all approach, it can be customised to meet your needs”.

Currently, the offering includes a ‘partial outsourcing’ offering wherein a supplemental service is offered, as well as ‘full outsourcing’ where the firm assumes the responsibilities of the trading desk. It supports institutional clients with global multi-asset trade execution services across over 100 countries. 

Read more: The Outsourced Trading Handbook 2023

“BNY is proud to support Goldman Sachs Asset Management’s sophisticated trading needs as they grow their world class investment platform,” said the firm in an official statement.

Outsourced trading is a trend which continues to be on the rise, whether full outsourcing or a supplement to the trading desk, more factors are pushing firms towards the service.

The attention has been increasingly turning to larger managers and while for the C-suite it might be an obvious economic decision, for many on the trading desk the topic continues to be a somewhat contentious one.

That concludes this first roundup of The TRADE’s most read content in 2024. Tune back in tomorrow for stories seven to four.

The post The TRADE’s most read stories of 2024, part one: M&A, quant moves, and outsourced trading remits appeared first on The TRADE.

There will be greater focus in 2025 on European competitiveness, with regulators needing to strike the right balance between fostering growth, competition and innovation in clearing on one hand and maintaining regulatory oversight and financial stability on the other. Central clearing will play a key role in this debate, which will be essential for advancing the region’s capital markets, and we look forward to Emir 3.0 helping in this regard.

Whilst there will be continued focus on top-down changes, we will continue to advocate for market-led approaches which strengthen the existing competitive framework, particularly in cash equities clearing, allowing participants to prioritise initiatives which enhance their operational and capital efficiencies.    

Aligned with this vision, we are committed to supporting Cboe Europe Derivatives, providing participants with the opportunity to benefit from significant cost savings and capital efficiencies by enabling clearing of a wide range of pan-European equity index derivatives and single stock options through a single CCP, challenging the status quo of how this market has been historically cleared. We are also confident that our pioneering central clearing service for European securities financing transactions (SFTs) in equities and ETFs will resonate with market participants.  

Lisa Danino-Lewis, chief growth officer, CLS    

In 2024, we’ve witnessed a continuation in the buy-side’s emphasis on adhering to best practices for mitigating settlement risk to meet regulatory expectations and to ensure robust risk management practices. As a result, CLSSettlement has experienced notable growth from the fund community, with nearly 80% of top-tier investment managers now accessing the service.    

The transition to a T+1 settlement cycle in North America this year highlighted the need for efficient and automated processes both pre- and post-trade, fostering a broader conversation on optimising post-trade workflows to handle growing complexities. This conversation is especially relevant as cross-border transactions grow in volume and as asset managers expand their investment in international markets. Looking ahead to next year, we anticipate that the buy-side will maintain a strong focus on best practices for FX risk mitigation, particularly in response to market volatility stemming from ongoing geopolitical risks and the continued trend for FX to be traded as an asset class.

Kaisha Schnoll, assistant vice president, STP Investment Services    

In 2025, discussions around the UK and EU’s transition to a T+1 settlement cycle are expected to intensify. The UK has outlined a roadmap targeting Q4 2027, but despite ample time to prepare, significant actions are likely to commence soon. Whether the UK moves in sync with the EU or independently, substantial preparation will be necessary to ensure a smooth transition.    

The UK Accelerated Settlement Taskforce (AST) is reviewing current infrastructure to guide regulators and policymakers in this shift. Its forthcoming report will outline the roadmap, including a target completion date, necessary steps, and operational requirements.   

Accelerated settlement offers benefits like reduced counterparty risk, enhanced liquidity, and alignment with the US. However, risks remain, including compliance challenges under the Central Securities Depositories Regulation (CSDR), tax complexities, cross-border trading, and CSDR penalties, all of which heighten concerns among market participants.    

To adapt, market participants will need to streamline processes using technologies like blockchain and real-time data analytics. Institutional investors and brokers may adjust more easily, but smaller firms could face difficulties, necessitating investment in new infrastructure or reliance on third-party service providers. Despite these challenges, T+1 aims to enhance resilience and strengthen the UK and EU’s global financial standing.

The post The TRADE predictions series 2025: Post-trade and the shift to T+1 appeared first on The TRADE.

This year was a pivotal year for digital assets, and we’re seeing strong momentum toward adoption. More and more institutional investors – on both the buy- and sell-side – continue to be getting engaged with this technology. We also saw a lot of progress on the regulatory front, with the SEC’s approval of Ethereum and Bitcoin ETFs in the US in 2024, and the first stages of the EU’s MiCA, the first-ever blockchain-related asset regulation, coming into effect.    

We still have our work cut out for us in 2025 and beyond. While we’ve clearly proven the merits of this technology, it’s time to put real applications on the ledger using tokenisation. As we move beyond pilots and start putting projects into production, we’ll need to make sure we’re collectively driving toward an end goal: building an efficient digital market infrastructure and standards. Collaboration is the core ingredient that will help us capture the promise that digital assets hold.

In 2025, we will continue to focus on establishing the digital market infrastructure of the future, showcasing how we can deliver the same efficiencies for digital assets as we do in traditional markets today, while also ensuring smooth market operation, transparency and liquidity.

Rob Hale, head of financial markets, Lloyds Bank Corporate Markets

Digital assets look poised to gain traction in wholesale markets next year, driven not only by increased issuance but also by the transformative application of distributed ledger technology (DLT) and smart contracts. While digital asset issuance will continue to expand, the real innovation lies in how DLT and smart contracts have the ability to revolutionise collateral management, moving beyond proof-of-concept to regular market use.

In derivatives markets, collateral agreements are fundamental for managing credit risk. When two parties enter into a contract under a collateral agreement, they agree to post collateral as market movements change the exposure between the counterparties. This process, currently conducted daily, involves complex calculations, bilateral agreement, and operational execution. With trillions of dollars of collateral exchanged daily, disputes, delays, and some inefficiencies are common and can be costly.   
   
DLT and smart contracts offer a paradigm shift. By automating collateral posting, these technologies eliminate disputes through fixed valuations. More importantly, they enable intraday collateral exchanges – potentially four or more times a day – compared to the current end-of-day standard. This increased frequency would significantly enhance operational efficiency, provide instantaneous settlement, and lower the capital buffer required to cover credit exposures.   
   
The benefits are clear: fewer disputes, faster processes, and a reduced operational burden. As these technologies mature, we can expect to see them adopted more broadly, creating a more efficient, transparent, and resilient financial ecosystem. Next year may well be the year when the promise of digital assets in wholesale markets becomes a reality. 

David Mercer, chief executive, LMAX Group     

The market for digital assets is poised for exponential growth, driven by breakthroughs in blockchain technology, tokenisation and long-awaited regulatory clarity worldwide. A shift from speculative interest to real-world utility will be a core driver and the inflexion point toward mass adoption by institutional investors and corporates more broadly. The ability to tokenise assets—making trading efficient, fungible and accessible—will revolutionise markets. Fractional ownership and instantaneous transfer of title will democratise access, enabling every tier of market participant to transact seamlessly at scale. 

Stablecoins and other digital fungible collateral, backed by reputable frameworks will underpin this transformation. By acting as a bridge between fiat and digital currencies, the world’s monetary systems can become more intertwined with the broader digital assets ecosystem. To achieve this vision, systemic risks such as market concentration and regulatory uncertainties must be addressed. Doing so will encourage more innovation in this space whilst providing investor protections and enable greater participation from real money to fuel these developments.

The post The TRADE predictions series 2025: What’s in store for digital assets appeared first on The TRADE.

From across the pond, we’re bullish 2025 could be a good year for UK equities. Firstly, with a new government and long-term fiscal policy, investors have greater clarity on the path ahead for the country. If they can successfully deliver the economic growth touted, we’re confident of a warmer reception by investors for UK equities.

Secondly, the relative value of UK equities provides additional upside should sentiment improve given their trend of undervaluation. US investors are always looking for value pockets, to which UK equites should be greater considered, particularly against their frothy US peers.

To achieve the rewards of such optimism, UK capital markets must continue evolving, and we expect London to still face challenges around perceived attractiveness. European and US exchanges will only continue to provide stiff competition, although we remain passionate believers in the potential of strong domestic markets.

The solution? Doubling down on efforts to make the UK an attractive investing hub, whether that be through listening to industry calls to scrap stamp duty reserve tax or better supporting the exchanges of Aquis and AIM to support small venture stage companies of tomorrow. These ideas alone would meaningfully improve attractiveness of UK equities further. Next year will bring no guarantees, and we’re expecting a few surprises along the way…  

Adam Conn, head of trading, Baillie Gifford  

I suspect this will be a year of index consolidation that will mask a further switch into high quality growth. I believe there will be a significant pick up in capital market activity, provided deals are priced realistically, leading to an increase in companies coming to the public markets through IPOs.

Brian Hyndman, chief executive officer, Blue Ocean Technologies 

The growth of 24-hour trading in equities has been a long time coming and a market structure development that first made headlines over twenty years ago. At that time, progress was limited to extending traditional trading hours slightly to the pre- and post-market. Also, given a lack of market demand and market infrastructure, the hours were never extended past 8pm eastern time.

Three years ago, Blue Ocean Technologies set out to solve this trading access problem that grew more apparent following the pandemic, a time that also helped fuel trading after hours in the US due to the increase in retail brokers, mobile technology, and geopolitical events. The launch of Blue Ocean ATS provided a complete modernisation of antiquated market hours during a time when investors around the world wanted the convenience of trading during unconventional market hours and in the case of Asia-Pacific, during their day-time business hours. This fuelled the geographical expansion among global investors with connectivity to retail and institutional brokers benefitting US equities trading.

As trading volumes continue to grow and new records are set, a new competitive landscape is emerging with the recent launch of another alternative trading system, OTC Markets, that will roll out their 24-hour equities trading capability and the NYSE’s announcement of their plans to roll-out this new trading offering. The entrance of new competitors is a positive trend for the global trading demand of US stocks that will only benefit investors. As the first platform to enter this space, we are encouraged by the new momentum and welcome the healthy competition.

Sylvain Thieullent, chief executive officer, Horizon Trading Solutions 

With a Trump presidency, it is fair to say that a lot of financial regulatory changes are completely up in the air. Right now though, the SEC has ratified changes to equity market structure including a move to reduce the tick sizes of trades. Smaller tick sizes would cause tighter spreads, which could have a knock-on impact on high frequency traders’ willingness to market-make US stocks while channeling large volumes of trading to technology firms like Robinhood.

This presents an opportunity for traditional retail brokers to win back the business that they have lost over the last decade if they are in a position to take advantage. They need to differentiate themselves and adapt to modern trading conditions. This means embracing technology, updating their internal operational processes, and ultimately creating the quality of experience that customers expect in 2025.

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In 2025, we will see momentum in European dark trading continue to build. Over the past 12 months, we have seen an explosion in dark trading and trajectory crossing venues, driven in part by the loosening and scrapping of double volume caps in the EU and UK. Increasing competition for market share in Europe’s shrinking lit markets has also played a role – this year, lit markets hit their lowest level as a proportion of overall European trading activity.

What does this mean for the buy-side? On the one hand, traders can expect more execution choice and capabilities. On the other, new venues mean greater fragmentation of dark and lit liquidity, and the potential for even greater complexity. Exchanges across the continent and even in the US are looking to get a slice of the action in Europe’s dark markets. Traders will have to keep a close eye on new venues entering the market to take advantage of greater execution choice but also to navigate an increasingly fragmented market.  

Belinda Mar, EMEA equities market structure, Bank of America Securities   

We’ve seen exchanges continue to innovate and launch new execution channels all through 2024, which isn’t a new thing, but of interest for 2025 are new European crossing platforms trying to replicate their successes in AMRS, alongside primary exchanges dipping their toes into dark pools.   

The differentiator in Europe at the moment is the trajectory cross, following its success in AMRS. CBOE, Nasdaq and Aquis are launching between Q4 2024 and Q1 2025. Whilst each of these offerings are slightly different, they have been popular in the US and Canada due to the rise in passive trading. Trajectories are algorithms which are benchmarked to an average price over time.   

In addition, a handful of primary exchanges have decided to compete in the dark pool space which will complement their more traditional offerings in lit markets. Euronext introduced their dark book in Q2 2024, enabling clients to trade at mid-point in the dark. Deutsche Borse and BME have just gone live with similar offerings in December 2024.

Finally, US based ATS One Chronos is looking to expand into Europe in 2025, where it will compete for a share of the periodic book. Whilst the level and pace of innovation is positive, we note that the European trading landscape is one where volumes remain low, fragmentation is high.

Iouri Saroukhanov, head of European derivatives, Cboe Europe

We anticipate one of the key trends in 2025 to be the continued increase in retail investor participation in European capital markets, particularly through exchange-traded products. While there is already some investing activity among European retail investors, it varies greatly between countries, with different products preferred in different regions. Overall, Europe has lagged behind other regions in retail market involvement due to regulatory, taxation, and cultural barriers. However, we expect this to change as policymakers increasingly recognise the benefits of a more engaged retail investor base and market participants become more attuned to the specific needs of this community in Europe.  

Efforts to bridge this gap will focus on enhancing education, accessibility, and a supportive regulatory environment. Educational initiatives will equip retail investors with the necessary knowledge and resources to better understand and utilise financial instruments like equity options. This will help them embrace the benefits of these products, rather than only focusing on complexities of derivatives, to help them achieve financial goals across their target time horizons. Accessibility will be improved through exchanges, mobile-first trading platforms, and apps, making investing in exchange-traded products more appealing to the retail segment.  

We expect more of the neo-brokers that have fostered retail participation in the US to make their way to Europe in 2025. Lastly, regulatory frameworks, such as the European Commission’s Retail Investment Strategy, will help support retail participation by addressing risk perceptions around options and promoting their benefits as transparent, centrally cleared financial products that offer risk management and income generation opportunities.

Seema Arora, managing director, head of EMEA execution services, Stifel

With nearly half the world participating in State elections this year, policy changes and geopolitical movements will be key factors for markets in 2025. While the US market momentum (i.e. magnificent 7) continue to impress, we believe compelling small and mid-cap investment themes will emerge. This is particularly true in Europe where earnings visibility is improving, and the specter of deregulation could meaningfully stimulate investment trends. The combination of consultation papers and a softening of Mifid II policies (re-bundling) are marginally helpful, but primary market health indicators will be the barometer for a more competitive European landscape.

From a trading perspective, sourcing liquidity outside of the lit market remains paramount for dealing desks. The sell-side will seek to optimise unique liquidity opportunities for clients; those able to leverage alternative pools (e.g. retail flow) should be well placed. Closing volumes will undoubtedly still dominate attention spans as will the evaluation of price formation versus cost of alternatives. It wouldn’t be surprising to see some consolidation in the market given the degree of fragmentation amongst venues and brokers. AI adoption will increase across the investment cycle and technical advancements to pre-match on T+0 prepare for the inevitable T+1 deadline. Watch this space!

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