As we mentioned before, XTRD attended Blockchain Futurist conference that took place in Toronto this August.

I was invited to speak on stage and I took this chance. Despite the fact that my presentation was a bit negative, we received a lot positive(will share it later) results.

So I decided to share my script and the presentation itself.

slide #2

Hello, my name Serg Gulko, I’m co-founder and CTO of XTRD, company that aims to build a bridge for traditional financial institutions to trade crypto assets.

I spent a decade as a CEO of my own software development company that actually builds trading systems, my partner Alex Kravets is a professional trader what worked on Wall Street for twelve years.

So I would say that we both have some relevant experience.

slide #3

If you are reading crypto-related media, you probably noticed that good part of rhetoric are circling around “when institutions are coming to crypto”.

And, of course, it means when they will start trading crypto more actively. We have own theory what holding back big guys with deep pockets.

slide #4

Exchange is the place built on trust. Sure thing you might have some shady participants on the other side of the trade but its up to exchange to handle it.

Answer one simple question to yourself — how many crypto exchanges do you trust? I’m not saying that all of them are committed wrongdoing but I’m betting that your list will be very short.

Believe me or not but the primary purpose of the exchange is to match buyers and sellers. No more, no less. But right now they are onboarding clients by running(or simulating) own KYC/AML procedures, they are holding clients money — fiat or crypto(because no custodian is available), and they are self-regulated so you have no guarantees or protection if something went wrong.

slide #5

Another upside down thing is a market making. In our world market makers are asking exchange to cooperation, they are persuading clients. In crypto everything is different. Exchanges are constantly looking for quants to do market making otherwise they don’t have a volume.

I know that things are a little bit faster in crypto comparable to traditional finance and people wants to speed up. Market making → CoinMarketCap → Moon.

slide #6

And now my favorite topic — technological aspects of trading. I usually like to complain that 90% of all exchanges are running on REST-only APIs where you should poll the data with a one-second interval. It’s kind of weird in 2018. Life itself and especially trading is a way more dynamic and you can’t reliably operate by asking “hey, how the orders book looks like”.

But REST API itself is not a problem. The problem is that each exchange created their own API. Of course, they are not compatible with each other.

slide #7

Things are different in the traditional finance. This is very inter-connected world thanks to the common rules and standards. And one of the keystones is a FIX protocol.

FIX protocol defines how different market participants should exchange information within the global eco-system. Buy-side firms, broker-dealers, exchanges, banks, prime brokers.

slide #8

Let me give you a small example. Here is market data from Bitfinex, Morgan Stanley, Gemini, Credit Suisse, HitBTC, and Currenex. As you can see, the right side is almost identical. Different venues but very similar messages. And I can’t say the same about the left side.

Basically FIX is a lingua franca for financial institutions. Its a language they talk to each other for decades. There are about 300 exchanges. How many of them support FIX? Five!

I believe that one of the main business rules is to give clients what they want. And institutions are juicy clients. And they want FIX.

slide #9

Lets discuss another important blocker such as asset classes itself. I’m not talking about BTC or ETH, things are more less clear with them. Yesterday’s data shows that we have more than hundred thousand different smart contracts running on Ethereum network. Perhaps one-third of them are tokens.

But what are these ERC20 tokens and why institutions should buy it?

Very likely I’ll create many enemies by saying this, but 80% of all blockchain-oriented projects don’t have a business model and will not survive after two or three years. Ideas like “we will burn half of our funds on marketing and another half — on market making” is not a business model. Add here the way most of the tokens are structured — no equity, no voting rights or profit sharing participation, parent companies registered on Bahamas or Cayman Islands and you will have a full picture.

So big guys will never play that game.

I believe that security tokens could become a game changer.

slide #10

So I think its a time to stop being so negative and explain what XTRD are doing. We want to unite the most reliable, and trustworthy exchanges into the single private network and to provide access to liquidity through our unified FIX API.

We will deliver your orders right to the exchange using our private internet lines what means that you can trade more faster and secure.

XTRD servers are not accessible over the public internet. So the only one option to start using our services is to cross-connect or co-locate with us in major financial hub Equnix. Right now we have a point of presence in NY4 datacenter but will expand to Europe and Asia shortly.

Worse to mention that XTRD is an active member of FIX Trading Community, especially their Digital Currency/Blockchain working group.

All our services can be paid in XTRD tokens.

slide #11

I can’t tell how long will it take for institutions to overcome all these obstacles — six months, a year but I can assure you that XTRD will be there when the time will come.