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Through its acquisition of multidealer platform 360T in mid 2015, Deutsche Börse demonstrated how quickly today's OTC FX microstructure can change, literally overnight. Acquiring 360T's US$76 billion average daily volume (ADV) gave the Frankfurt-based giant exchange group a tangible footing in the FX marketplace. Until recently, 360T's volume was mostly outright forward and FX swaps.
Putting in context the May 2018 Deutsche Börse acquisition of Gain GTX, 360T's FX business now has spot FX ADV of no less than US$20 billion - a size threshold that not too many platforms possess. Spot FX at large has not grown as much as fast as other parts of the FX market in recent years, but is a necessary component for asset managers to carry out price discovery. It should be noted that most 360T volume is fully-disclosed and based in Europe. Following the Gain GTX purchase, 360T is achieving two additional goals: 1) grow their U.S. business, and 2) give wings to their recently announced anonymous central limit order book (CLOB) - a sizable lift to compete with Hotspot FX, EBS, Matching, and others.
Armed with a balanced FX product mix and an ADV of slightly more than US$90 billion, Deutsche Börse is more than well positioned to compete with other radical changes taking place in the eFX arena, such as the likely CME Group acquisition of NEX Group (EBS' parent). What makes 360T interesting to watch is the assertive way in which 360T's FX business is being integrated into the DB architecture, for example by linking collateral management for both listed and OTC FX clearing (see chart).
[The eFX Feature is a non-sponsored review of firms Forex Datasource routinely covers]