Instinet, a provider of agency brokerage services to clients globally, will locate the matching engine of its proprietary BlockMatch multilateral equity trading facility (MTF) into Interxion’s London colocation data center campus. Using BlockMatch, Instinet’s clients would be able to trade on its matching platform with fair and equal access through Interxion’s cross-connect parity solution.
The soon to be launched service would offer market participants equal connectivity and consistent speed when trading; an important step in preparing for MiFID II. Access to BlockMatch from Interxion’s London Data Center Campus will become available to all participants later in Q4 2017, ahead of the MiFID II implementation on 3 January 2018. BlockMatch will continue to operate in its current capacity until the move to the Interxion London data center campus.
Under the hosting arrangement, all BlockMatch participants connecting to the trading platform from a proximity hosting location within the Interxion colocation data center campus will receive equalized cross-connects with a set distance of 250m, “eradicating any material latency differences between users.” Interxion will also provide Instinet with redundant GPS, Glonass and Galileo time synchronization signals “to enable BlockMatch to use highly accurate clocks to meet its MiFID II microsecond precision time-stamping obligations.”
“Locating the BlockMatch matching engine at Interxion’s London campus will ensure all participants will have the same advantages, this includes fair equalized access, speed of trading and high precision timestamps,” said Ben Stephens, head of business development at Instinet Europe. “As more trading moves to MTFs and the regulatory framework surrounding trading venues becomes more complex following MiFID II, having key elements of performance and compliance built into our data center operations is the right thing to do both for us and for our clients.”
MiFID II is poised to become the gold standard for equity trading and market oversight in financial services, demanding firms make major changes to the way they operate, as well as the technology and connectivity infrastructures they depend upon.
“MiFID II places a clear obligation on institutional clients to demonstrate best execution and on venue operators to ensure that there is no discrimination between participants. Fair and equal market access is essential,” said Bill Fenick, Interxion’s Strategy and Marketing Director for Financial Services. “As a global leader in equity trading, Instinet’s commitment to not just meeting, but exceeding compliance requirements is exemplary. Working in our data centers, Instinet can give its clients confidence that they’re trading on an even playing field.”