The truePTS platform launched in June after JP Morgan and Citadel processed the first buy-side transaction, using artificial intelligence and robotics to remove manual procedures for matching and clearing of over-the-counter (OTC) derivatives.

A spokesperson for trueEX confirmed the move, adding that “trueEX is exploring a strategic sale of its truePTS intellectual property”.  The website for truePTS has also been closed. 

The platform was first backed by JP Morgan and Citi in December 2017 after signing up to use it for automating back-office functions, with trueEX stating that it expected other industry participant’s to join in the coming months.

“New regulatory requirements have shifted responsibilities and fees once paid by the banks to the buy-side,” said Zohar Hod, CEO of truePTS, at the time of the platform’s launch.

“We will be the catalyst that provides transparency, mitigation of needed resources, and lower costs for our clients by leveraging the most progressive technology to automate workflows and comply with regulatory change.”

It was initially tipped to rival IHS Markit’s derivatives processing system MarkitSERV. The two firms were also locked in a legal battle last year after trueEX claimed that IHS Markit had tried to stop access to its trade processing service. The legal dispute was eventually settled late last year.

Meanwhile, IHS Markit confirmed plans to sell MarkitSERV earlier this year, stating that after a detailed review of the financial services business as part of its capital allocation strategy. 

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Digital currency trading firm trueDigital was launched by Sunil Hirani, a capital markets veteran most recently known for founding swaps execution facility trueEx, a platform which took on some of the major players in the OTC derivatives world.

The rates can serve as an underlying reference for futures contracts, as the trend from firms looking to provide institutional-grade products continues.

The trueDigital reference rates, comprised of bid and offer pricing from top cryptocurrency market makers, include automated anti-manipulation safeguards such as outlier detection and price banding.

While reference rates such as Libor have gone through scandals in recent years, trueDigital said it has robust policies to “surveil potential manipulation and review the contributing sources on an ongoing basis in line with the IOSCO based methodology”.

“The digital asset market is still young, especially for financial institutions,” said Michael Moro of Genesis Global Trading. “trueDigital is methodically building the components needed to evolve this ecosystem and make it habitable for firms seeking exposure to digital assets. OTC indices are the next leap forward in the maturation of the market.”

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The firm said initial contracts will available be for Bitcoin non-deliverable forwards (NDFs) settled in USD, listed under a new brand ‘trueDigital’ on its existing swap execution platform, pending regulatory approval.

The trueDigital contracts will be subject to licensing and services agreements with the newly created trueDigital Holdings business, which will act as the sales and marketing arm for new products.

The swap execution facility said despite digital assets including Bitcoin and Ether comprising in excess of $430 billion in market capitalisation, the marketplace has been lacking regulatory and technology building blocks for institutional involvement.

“Institutional investors and commercial partners are ready for a regulated and liquid marketplace to gain exposure to and hedge these increasingly important digital currencies and commodities,” said trueEX co-founder and CEO, and CEO of trueEX Digital Holdings, Sunil Hirani.

“The marketplace is sorely lacking the necessary foundation, infrastructure and platforms that institutional investors have come to expect in other important markets.”

ED&F Man Capital will act as the first futures commission merchant (FCM) to offer prime brokerage services on digital asset forwards on trueDigital.

Brooks Dudley, vice president of risk at ED&F Man Capital, explained NDFs are the next logical step for institutional investors seeking exposure to Bitcoin and other digital currencies.

“[Hirani] is a proven innovator in financial products and market infrastructure, and one of the earliest advocates for the use of digital assets in institutional finance. We’re looking forward to working with his team at trueDigital,” Dudley said.

trueEX also announced it will team up with blockchain software provider ConsenSys to develop a benchmark rate for digital asset Ether, and to develop the infrastructure for the broader adoption of cryptocurrencies by institutional investors. ConsenSys was recently selected to support a new initiative by the European Commission, to monitor and engage with the development of European-based blockchain projects.

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US interest rate swaps trading venue trueEX has expanded its operations into Asia-Pacific with the opening of a new office in Singapore.

The move will mean traders in Singapore, Australia and New Zealand will gain access to the firm’s interest rate swaps trading platform.

trueEX said the decision to expand followed a record year for the swap execution facility, after a 460% increase in trading on its execution platform in 2017.

“With the tremendous growth in support of the trueEX platform, we’ve seen a significant increase in demand for trading in Latin American, European, and now Asian-Pacific currencies,” said Christopher Yoshida, chief strategy, sales & marketing officer at trueEX

“From the outset, the Asian markets have been a key component of our long-term strategy. Now that it’s become a reality we’re able to not just meet the needs locally, but provide a gateway between participants in Asia-Pacific and the rest of the world.”

The move also follows the Monetary Authority of Singapore’s (MAS) proposed rules which could see over-the-counter traded derivatives migrate to on-exchange platforms, trueEX added.

“There is a growing demand across the region for more liquid local currency hedging instruments,” said Andrew Baker, head of trueEX’s Singapore office.

“Providing these services is a natural extension of our ‘client first’ approach, which has led to us to developing a significant global footprint across 28 currencies and multiple protocols across all the major time zones.”

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JP Morgan and Citi have become the first users of truePTS, a derivatives processing platform which uses robotics and artificial intelligence (AI) to automate back-office functions.

The platform uses proprietary matching and validation engines, as well AI voice deal capture technology, to allow auto-matching and direct clearing, and the automation of manual processes of OTC derivatives.

“We look forward to working with truePTS and the other market participants to develop new processing solutions for our clients,” said Kieran Hanrahan, global head of markets middle-office, JP Morgan.

The announcement comes after trueEx, a US swap execution facility (SEF) and owner of truePTS, ended its almost year-long legal battle with MarkitSERV, in which it claimed IHS Markit had attempted to prohibit trueEX from accessing its trade processing service.

Following the onboard of Citi and JP Morgan, truePTS anticipates other industry participants to join in the coming months.

“We will be the catalyst that provides transparency, increases efficiency and lowers costs for our clients by leveraging the most progressive technology,” said Zohar Hod, CEO of truePTS.

“We’re able to leverage the industry leaders’ strategic input, particularly as we address the challenge of scale with other clients to become the new benchmark in the post-trade processing industry.”

With two of the biggest swaps dealers signed up, it could further boost trueEX’s position in the US interest rate swaps market. As the last start-up SEF remaining, it has captured a significant portion of market share from incumbent platforms such as Tradeweb and Bloomberg. 

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US interest rate swaps trading venue trueEX has settled a legal dispute with Markit after it sought legal action against the firm for anti-competitive reasons earlier this year.

trueEX initially filed a complaint after Markit terminated its access to trade processing service, MarkitSERV.

In an open letter written to clients in May this year, CEO at trueEX, Sunil Hirani, described Markit’s move as “unilateral and only being to trueEX.”

He added trueEX believed Markit was looking to interact with the exchange the same way as it does with voice broker IDBs, so it would be able to exclusively perform matching, clearing and other processes of transactions.

“This change requires trueEX to insert Markit in the 'middle' of all of our activities in order to process, clear and report transactions, thereby creating additional workflow steps, potentially slower response times, additional software and connectivity changes and higher costs,” he said at the time.

Both firms have now resolved the issue and MarkitSERV will continue to provide the same service it currently provides to similar venues to process trades.

Furthermore, trueEX will now offer the choice of processing trades to clearing through trueEX or MarkitSERV.

trueEX recently appointed a new chief technology officer (CTO), amid plans to expand into the broader rates market.

Kevin Lupowitz has been appointed CTO and tasked with overseeing the expansion of trueEX’s platform in terms of technical specifications, functionality and performance.

The interest rate swap execution platform has seen its notional trading activity grow a massive 542% year-to-date compared to the year prior. Similarly, its share of the dealer-to-client swaps market now stands at more than 30%, up from 9% just a year ago.

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Interest rate swap execution platform trueEX has appointed a new chief technology officer (CTO) as it looks to expand into the broader rates market.

Industry veteran Kevin Lupowitz has been appointed CTO and tasked with overseeing the expansion of trueEX’s platform in terms of technical specifications, functionality and performance.

He has held several chief information officer roles at major institutions throughout his career, including Liquidnet where he was also a founding employee, and for Thomson Reuters’ FXall trading platform.

Sunil Hirani, CEO and founder of trueEX, explained Lupowitz’s hire signals the firm’s intent to accelerate its expansion into the rates market for both dealers and institutional clients.

“With his experience at other successful industry innovators, I’m confident that Lupowitz will play a key role in this, supporting and building on our unprecedented 2017 growth.”

This year has been a strong one for trueEX, with notional trading activity up a massive 542% year-to-date compared to the year prior. Similarly, its share of the dealer-to-client swaps market now stands at more than 30%, up from 9% just a year ago.

Lupowitz described his new role as an “exciting growth opportunity to work with a pioneering, rapidly growing and independent provider of trading technology”.

He added: “With its expanding dealer and client footprint, trueEX has the potential to transform the efficiency and structure of the global interest rates markets.”

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According to data compiled by Tabb Group, trueEX has seen its market share grow exponentially over the past two years.

Despite only capturing less than 1% of total Sef volumes in vanilla swaps in mid-2014, for the first half of 2017 it recorded the second highest volumes across all platforms.

In March alone, trueEX reported $3.3 trillion in notional volume of interest rate derivatives, the most out of any Sef platform including rivals Bloomberg and Tradeweb – two major market players.

Being the last remaining start-up Sef, trueEX has managed to attract a wider range of swaps dealers and buy-side clients to its platform due a core offering of non-standardised products and trade compression, despite facing stiff competition from the incumbent dealer-to-client (D2C) platforms.

“To date, we have been significantly handicapped and disadvantaged in trying to bring to market products and services we think are superior to what is offered by the incumbent Sefs,” Sunil Hirani, CEO of trueEX told the TRADE Derivatives. “Although many of these obstacles remain in our path, we are greatly encouraged by recent favourable events.”

Hirani said despite low volumes over the past two years, interest has built up as more dealers are onboarding onto the platform. It now has nearly 90 buy-side clients, and 13 clearing banks including Bank of America Merrill Lynch, Citigroup, Goldman Sachs and JP Morgan.

“It is becoming easier and easier for buy-side firms to give us the same shot as the incumbent platforms,” Hirani added. “Today we have more dealers going live with us; more products and jurisdictions being covered; and more cleared, non-cleared swaps and swaptions on our platform. The result is that we will continue to have months like we have seen this year with more buy-side firms coming on board and utilising us for more currencies and products.”

Most recently trueEX hired Chris Yoshida, a former head of rates sales at Deutsche Bank and Morgan Stanley, to run sales, marketing and strategy and to capitalise on its rapid to growth as it gears up for expansion into Europe and potentially Asia.

By carving itself a sizeable share of swaps trading through niche non-standardised and standard derivatives, Hirani is aiming to offer clients every interest rate product under the sun to trade.

“Moving forward, we are going to expand into a broader range of products within the rates space to enhance the client and bank experience. With our expanded rates strategy, our platform will have greater coverage of rates offerings priced, executed and processed electronically – that is a win for all market participants.”

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trueEX is seeking legal action against Markit for anti-competitive reasons following a decision to terminate access to its trade processing service, MarkitSERV.

The US interest rate swaps trading venue currently provides execution, matching, direct clearing, reporting and straight-through processing ‘drop copy’ connectivity to MarkitSERV.

However, trueEX claims Markit is no longer willing to accept a ‘drop copy’ and has ended the relationship after several years.

In an open letter written to clients, CEO at trueEX, Sunil Hirani, described Markit’s decision as “unilateral and only being to trueEX.”

He added trueEX believes Markit is looking to interact with the exchange the same way as it does with voice broker IDBs, so it would be able to exclusively perform matching, clearing and other processes of transactions.

“This change requires trueEX to insert Markit in the 'middle' of all of our activities in order to process, clear and report transactions, thereby creating additional workflow steps, potentially slower response times, additional software and connectivity changes and higher costs,” he said.

Hirani has encouraged trueEX’s clients to directly ask Markit why is has decided to take this action and convince it to withdraw the decision.

A spokesperson at Markit said the firm has no comment on the complaint. 

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trueEX has announced the launch of its trading platform for non-cleared interest rate swaps in Europe.

The platform - which has already launched in the US and Canada  - allows dealers and their buy-side clients a central venue for novation, processing of transferring of swaps, pricing and margin payments.

Providing an electronic protocol to communicate the trade information, pricing, credit support annex (CSA) details and margin payments, the platform streamlines negotiation and assignment of unlimited numbers of swaps, trueEX said.

Head of product development at trueEX, Christina Landry, described the launch in Europe as a “watershed moment for the non-cleared swaps market.”

“By opening up the marketplace to more efficient execution and processing, we can vastly improve the experience of trading and managing these systemically important instruments for both the front and back office,” she said.

Societe Generale has already implemented the trueEX platform and its managing director, Barry Cohen, explained it has helped drive Soc Gen’s position in non-cleared currencies.

“We were the first dealer to transact dealer-to-client IRS in PLN, MXN and BRL via trueEX. Moreover, trueEX helps us manage a significantly more efficient and cost-effective workflow,” he said.

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