Trade surveillance: it’s a fundamental need for a well-functioning marketplace. With so much value changing hands, the ability to assess risk, create comprehensive reports and spot problematic behavior is crucial to imparting peace of mind to clients and staying out of regulatory crosshairs. This is true in any market, from the established worlds of equities and fixed income to the rapidly developing digital assets space.
In the U.S., a wave of enforcement actions has emphasized the need for robust trade surveillance capabilities. Recent years have seen record-shattering fines for spoofing and similarly manipulative activity, with penalties as high as tens or even hundreds of millions of dollars. Among market participants, there is a consensus this remains a top priority for regulators and that another wave could come crashing down at any time. Meanwhile in the UK and Europe, market participants are eyeing the developments across the pond and expect their regulators to follow suit.
In this environment, firms are more reliant on their trade surveillance systems than ever before. Yet the approach taken by the legacy providers in this space – reducing false positives by narrowing the types of data they capture – is simply not enough to ensure security and compliance. Their clients often end up missing risk factors or instances of potential manipulation, and when a regulator calls in search of an explanation, they risk being left without an answer.
The solution is simple: capture more data, not less. By casting a wide net at the outset, Eventus Systems’ clients can feel confident that our Validus platform is flagging dynamics or behaviors that warrant a closer look. This is the scope, scale and accuracy the industry needs – and one that legacy surveillance systems that require endless recalibration to reduce false positives just can’t provide.
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