Post-trade infrastructure provider, Cobalt has today announced that FX electronic communications network, Spotex is the latest client to sign for its dynamic credit management tools.
Risk Hub, Cobalt’s credit management system, is now available to clients of Spotex as the ECN has its sights on growing its business in the aftermath of recent industry changes. As the company has already opted to diversify its product range and clientele, this move will allow Spotex users to benefit from the cost savings that Cobalt’s infrastructure provides.
Real-time updates of their exposure and credit risk can be managed now centrally on Cobalt’s Risk Hub.
“By providing a solution to the overallocation of credit, the Cobalt and Spotex partnership directly addresses ongoing pressure points in the FX markets. Both companies alleviate the risks of legacy technology while protecting clients’ exposure by providing automated monitoring solutions,” the two companies said in a statement.
For Spotex, the agreement comes amid other initiatives to broaden participation on its network. It allows its clients to access a new source of much-needed liquidity in the FX space. As such, the combined offering helps reduce costs for buy-side firms to connect and trade FX markets by combining trading, technology and credit services into one product.
By creating a single and shared view of a transaction, Cobalt DL aims to free up back and middle office resources that are currently overwhelmed by multiple unnecessary license fees, ticketing charges, IT overheads and staff costs. Its technology is being part-supplied by First Derivatives, a Northern Ireland company that is also an investor.
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Spotex is a US-based ECN focused on FX and precious metals trading for both the buy and sell-side participants. Their client base includes banks, brokers, hedge funds, CTAs and asset managers who leverage an array of electronic solutions that assist clients with complex liquidity sourcing and trade executions.
“Our work with Spotex in consolidating our dynamic credit offering is doing precisely that. Through the partnership, we are able to deliver our suite of real-time automated credit management and monitoring tools to more market participants at a time where transformation is gathering speed,” said Darren Coote, CEO of Cobalt.
John Miesner, Spotex CEO added: “With Cobalt, we are able to provide our FX clients with a complete real-time picture of their risk. Additionally, as we broaden our product offerings, specifically in NDF’s & FX Forwards, alongside the Cobalt infrastructure, partnering with Cobalt was a logical decision. Furthermore, as Digital Asset opportunities continue to grow, we feel Cobalt’s existing involvement in the Digital space will be beneficial to Spotex as we enter this arena.”
Amid the growing popularity of cryptocurrency in the institutional space, Cobalt has expanded its platform into the digital asset market. The move comes as big players in the financial sector are increasing their wager that distributed ledger technologies like blockchain will be the key to leadership in the future.