Welcome back to the Forefront Week in Review, where we take another look at top recent stories from the action-packed world of trading and market structure.
First, some housekeeping: due to the July 4 holiday, the Forefront Fintech Digest won’t be going out on Thursday or Friday this week, nor will there be a Week in Review next Sunday. Whether you’re eyeing your local corner store’s fireworks selection or simply plan to spend the day with friends and family, we hope you’ll take some time to leave your desk, enjoy the summer weather and reflect on the great freedoms we enjoy thanks the the sacrifices of our founding fathers, as well as countless other heroes and citizens who came later.
Turning an eye towards the headlines, one of the biggest events from last week was the start of the 2020 presidential debates, in which 20 Democratic hopefuls took to the stage over the course of two nights to discuss issues like student debt, immigration and climate change. Coincidentally (or not), one of these candidates landed in the news earlier in the week for taking aim at Wall Street — Senator Bernie Sanders has proposed a tax on every trade involving equities, bonds or derivatives, with the aim of erasing the nation’s $1.6 trillion student debt over the course of the next decade. It’s a bold plan, and while the makeup of the Senate may make it difficult to pass for now, it will be interesting to see how the rhetoric towards the financial services industry develops over the course of what should be a long campaign.
In other news, Deutsche Bank looks poised to carry out a big round of job cuts, while Tal Cohen of Nasdaq was promoted to Executive Vice President, North American Market Services. Forefront clients were also in the news, landing in publications like the Globe and Mail and Waters Technology.
This week’s Week in Review features stories by Jenny Strasburg of the Wall Street Journal, Samuel Agini of Financial News and Frank Chaparro of The Block, among others. Keep scrolling for more, and don’t forget to subscribe to the Forefront Fintech Digest if you’re not on our list already.
Deutsche Bank Considers Up to 20,000 Job Cuts
Wall Street Journal | Jenny Strasburg
Deutsche Bank is weighing whether to cut 15,000 to 20,000 jobs, or more than one in six full-time positions globally, according to a person familiar with high-level discussions about the latest attempts to turn around the struggling financial giant. The cuts being contemplated by senior executives reflect an acceleration of Deutsche Bank’s downsizing and another major pullback from its global ambitions. If followed through, the reduction would represent 16% to 22% of Deutsche Bank’s workforce of 91,463 employees, as disclosed by the bank as of the end of March.
Exchange, ATS and Clearing News
Global Trading Head at Nasdaq Set to Retire by End of the Year
The TRADE News | Hayley McDowell
US exchange operator Nasdaq has confirmed that its head of global trading and market services is due to retire by the end of the year after more than a decade with the company. Nasdaq confirmed in a statement that Tom Wittman will step down from his role by the end of 2019 and become an executive advisor reporting to Adena Friedman, CEO of Nasdaq, but will continue to manage the fixed income division for the rest of the year. At the same time, Nasdaq confirmed that Tal Cohen, who joined the exchange in 2016 as senior vice president of North American equities following the acquisition of Chi-X Canada, has been promoted to executive vice president of North American Market Services.
The KYC Headache Worsens: An Examination of the Onboarding Process
Waters Technology | Rebecca Natale
Like a dinner party when the clock strikes midnight, the know-your-customer (KYC) space is thinning out. The main challenges can be boiled down to continually shifting regulations, little transparency between sides during the process, and technology’s struggle to play catch-up. This is why there are still plenty of vendors staying in the market and looking to pick up clients as others leave the space, including IHS Markit, Dow Jones, LexisNexis and Bureau van Djik, among many others. Even with the tools that are populating the space, it still requires a lot of manual effort and time.
Buy Side News
The Quiet Rock Stars of Hedge Funds Are Data Junkies, and They’re in Such High Demand That They’re Navigating 30 Back-To-Back Meetings in 48 Hours
Business Insider | Bradley Saacks
Roberto Jedreicich gets to the point. The decision-maker on all things alternative data at Credit Suisse’s internal $650 million quant fund, QT, is flooded with pitches and meeting requests from new data vendors on the average day. Whether it’s satellite images, credit-card transactions, or information scraped off the web, the collection of obscure data known as alternative data, which is used for investment purposes, is a growing business. A Deloitte report pegged the alternative-data market to surpass the $7 billion mark by 2020.
High-Speed Traders Optiver and Virtu Back EU Trading Venue
Financial News | Samuel Agini
Optiver, the Dutch trading firm, and US rival Virtu have backed Equiduct in a funding round designed to support the EU trading venue’s expansion. Equiduct said in a June 27 statement that it has raised €3.25m from investors also including Börse Berlin and Jos Peeters, the investor who helped to start Easdaq, a predecessor firm to the trading venue. While Optiver is a new investor, Virtu, Börse Berlin and Peeters are existing shareholders. Optiver’s investment comes after the trading firm agreed last December to provide continuous liquidity in thousands of European stocks and exchange traded funds on Equiduct.
Regulatory & Legal News
Bernie Sanders will propose canceling the nation’s outstanding $1.6 trillion of student debt and offsetting the cost with a tax on Wall Street transactions. The Vermont senator will propose legislation Monday that would provide debt relief to some 45 million Americans who have college loans, according to a fact sheet provided by his Senate office. The plan would include a 0.5% tax on stock transactions, a 0.1% tax on bond trades and a .005% tax on derivatives transactions. Sanders’s proposal, which comes ahead of this week’s Democratic debates, also would provide states $48 billion annually to eliminate undergraduate tuition and fees at public colleges.
Blockchain & Crypto News
Gemini Is Chicago-Bound After Coinbase’s Exit, but Who Made the Right Move?
The Block | Frank Chaparro
Gemini is hoping to achieve what rival Coinbase couldn’t: successfully building out a presence in Chicago aimed at luring high-speed traders to the incipient cryptocurrency market. The New York-based firm, led by twin brothers Tyler and Cameron Winklevoss, announced Thursday the new outpost for Gemini, which will scale its existing colocation data centers. In an interesting twist of fate, the firm says it has brought on a number of engineers who previously worked for Coinbase’s Chicago office, which was shuttered in April.
Forefront Client News
Canada’s 2019 Hemp Crop to Surge on CBD Demand, but Pricing Will Be Tricky
Globe and Mail | Marcy Nicholson
In the United States, an over-the-counter physical commodities exchange is aiming to establish index prices for hemp biomass. In January, Colorado-based PanXchange launched what it calls the first-ever U.S. hemp index with plans to open a full hemp trading platform later this year. “We are quietly onboarding top tier clients. The reason why we’re getting traction so quickly in this market is the need for accurate prices and the confidence that we can provide it,” said Julie Lerner, a former trader at Cargill who is now CEO of PanXchange in Denver.
Northern Trust Automates Regulatory Reporting With Confluence
Waters Technology | Rebecca Natale
Northern Trust is leveraging Confluence, a provider of cloud-based software and technology solutions to asset managers, to automate financial and regulatory reporting for its European asset management clients. Northern Trust is using Confluence’s Unity Financial Reporting offering to automate the building of statements and holdings reports, while working upon its broader platform, Unity NXT Regulatory Reporting, to automate the sourcing and aggregation of data for clients’ regulatory reporting.
TORA Expands Sales Presence with Key US Appointment
Yahoo Finance | Staff
TORA, provider of the industry’s most advanced cloud-based order and execution management system (OEMS), has announced the appointment of Thomas Mullooly as its new Head of US Sales. In this role, Mr. Mullooly is responsible for all sales efforts throughout the United States, and will prioritize the further adoption of TORA’s sophisticated OEMS in this key market. He reports to TORA managing director Chris Jenkins. “Thomas is a wonderful addition to our global sales organization. He has deep experience in trading technology and multiple years of senior sales and business-development experience in the capital markets,” said Mr. Jenkins.
That’s all for this week. Don’t forget to subscribe to the Forefront Trading Digest for more headlines like these.