With 2019 being referred to as a landmark year for institutional investment in digital assets, trading performance is a high priority. Current exchanges being developed to accommodate such investors are focused on delivering a frictionless and intuitive experience, covering everything from trading technology to user experience.
Let’s recap the essentials of performance and what we can expect from the next generation of digital asset exchanges.
Order matching engines
Every exchange has a matching engine, which works as a mechanism for completing transactions. The quality of a matching engine is determined by how fast it can match and fulfil trade orders – the faster it works, the higher the performance of an exchange.
For example, ANXONE’s matching engine is able to facilitate 190,000 transactions per second with 99.8% uptime. With such a significant volume of trading activity being managed at any given time, traders can invest knowing they are able to execute their strategies without avoidable disruptions.
Platform speed is essential to the trading experience due to volatility in the market. Any lag between the initiation and matching of an order can significantly affect the entry and exit prices and thus influence any potential profit and losses. Reducing or removing such lag is non-negotiable for today’s digital asset exchanges, especially at a time when the volume of digital asset trading activity could reach unprecedented levels. Exchange technology simply must be capable of scaling into the future.
Shared order book technology
A shared order book is a digital list of buy and sell orders, which a matching engine “matches.” With a deep order book, there are more active orders available to match. There will thus be more liquidity for traders on the platform and a reduction in the impact made by large-scale trades.