CHICAGO, Feb. 21, 2019 (GLOBE NEWSWIRE) -- Seed CX, the only digital asset exchange built exclusively for institutional investors, reported today that trade execution costs on the Seed Digital Commodities Market (“SCXM”), a subsidiary of Seed CX, are among the lowest of all digital asset execution venues globally. Spot trading on SCXM officially launched at the beginning of this year.
Trading groups can now reliably execute orders of 100 BTC or greater on either side of the order book (i.e., buy or sell) with approximately 20 bps slippage, making SCXM one of the most efficient places to trade digital assets among other exchanges and OTC providers across the globe.
Execution cost is primarily a function of exchange fees and slippage, two areas addressed by Seed CX’s uniquely institutional market structure:
- Lowest Fees in the industry: For liquidity providers–or “makers”–there are no trade or settlement fees on SCXM. For liquidity “takers,” the fee is just eight basis points for monthly volumes under $100M and six basis points thereafter, lower than other digital asset exchanges’ reported fee schedules.
- Reduced Slippage: Slippage is defined as the difference in the average fill price for an order vs. the stated bid or ask price, and lower slippage equals better execution. As SCXM’s market now consistently allows for orders of 100 BTC with approximately 20 bps of slippage, this means that the average price for such an order will be just 0.2% within the bid or ask. This means a better effective price on SCXM compared to other exchanges.
“We have been very intentional in creating an institutional trading venue that gives institutions more confidence than they have on other trading venues, through our investments in technological, operational and compliance excellence,” said Edward Woodford, co-founder and CEO of Seed CX. “And now, our deep order book strengthens our efforts to not only be qualitatively the best trading venue, but also the most efficient execution venue for digital asset trading.”
In addition to some of the lowest execution costs, SCXM offers participants a number of advantages over traditional “retail-first” digital asset exchanges, including:
- Low Latency and Connection Reliability: Seed CX infrastructure allows groups to reliably trade on Seed CX’s matching engine at NY4 and to access the market using either FIX protocol or Web API.
- Margin Trading: Seed CX provides leverage trading to market participants and allows collateral to be posted using non-traditional assets, such as digital assets.
- Institutional Market Structure: Tick sizes–or minimum price increments–are larger than on other exchanges, creating more liquidity at each price band and allowing market makers to quote larger, more consistent sizes because they do not have to react and re-price as frequently to external stimuli.
- Secure Custodying of Assets: All USD deposits are held in regulated and FDIC-insured US banks. Digital assets are held in Seed CX’s secure wallet infrastructure, which segregates holdings in individual participant’s multi-signature wallets rather than omnibus wallets. This allows the movement of digital assets to be reconcilable with the public blockchain.
- Robust Compliance: Seed CX does not trade against clients and surveils the market to ensure an efficient and fair market for all.
- Account and Sub-account Permissioning: Participants can create any number of accounts and sub-accounts to precisely control who has trading and admin privileges.
- Dedicated Institutional Coverage: A dedicated team of operational support professionals based in Chicago provides around-the-clock support via email or phone.
"Seed CX offers one of the most efficient places to execute orders. On other platforms, if you do any size, you tend to get hundreds of small fills with an average price that is far worse than the headline bid or offer,” said Tom Garrambone, Managing Member of Tetras Capital Partners LLC, an investment manager and an investor in Seed CX. “Aside from order efficiency, which is a key factor as to where I decide to trade, Seed CX has also built a state-of-the-art market optimized for investment managers in crypto, such as how they have technologically built their platform, handle wallets, margin and customer service.”
In addition to strong liquidity in both BTC and ETH, Seed CX also said that it intends to introduce new pairs throughout the year.
“We look forward to continuing to deepen our BTC and ETH books and launching USD-BCH and USD-LTC trading at the end of this month,” added Seed CX’s Woodford.
About Seed CX
Seed CX is a Chicago-based licensed digital asset exchange, which, through its subsidiaries, offers a market for institutional trading and settlement of spot digital assets, and plans to offer a separate market for CFTC-regulated derivatives. Seed CX is backed by Bain Capital Ventures. Seed CX wholly owns a number of subsidiaries:
Seed Digital Commodities Market is a spot exchange for digital asset commodities. It currently offers USD trading pairs to BTC and ETH, introducing BCH and LTC later this month.
Zero Hash is a FinCen regulated Money Service Business and FX Dealer as well as a Money Transmitter in nearly 30 States. Zero Hash custodies both fiat and digital assets, with on-chain settlement.
Seed SEF is a CFTC-regulated Swap Execution Facility (SEF) that plans to offer a market for CFTC-regulated digital asset derivatives.
Seed Digital Securities Market is pending registration as a Broker Dealer with FINRA and an ATS with the SEC.
The comments, views and opinions expressed in this article reflect the opinion of the quoted author or speaker, are subject to change without notice, do not necessarily reflect the views of Tetras Capital Partners LLC (“Tetras”) or other professionals at Tetras, and are not intended to provide financial planning, investment advice, legal advice or tax advice.