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TradeConnect promises to be the biggest shakeup to financial markets of the decade. With blockchain technology deployed alongside advanced matching systems, the platform will bring substantial benefits directly to both traders and the global trading scene. Ultimately, TradeConnect will bring trading firmly into the future.
Traditional trading models
Traditional trading systems can be split into two groups: the broker model, and the no-dealing desk model.
In the first, the trader opens an account with a broker and places a trade. The broker acts as counterparty, and the market decides who wins and who loses.
In the second, for every trade placed, the broker automatically places a matching trade in the underlying market. With access to better pricing, brokers operating under this model profit from the commissions they charge.
The problem with these two models is that they are both based on risk taking. When brokers get it wrong, their clients’ funds are at risk. In the history of the markets, there is no shortage of brokers going bust for this very reason: a reason blockchain will make obsolete.
The TradeConnect solution
TradeConnect is the trading network of the future. Thanks to blockchain, traders are able to operate directly with one another, having complete access to their own funds, and do so in a a market-neutral system.
As well as the security benefits of moving away from brokers, the platform is also set to offer traders substantial financial incentives. Brokers typically charge a commission for their service. TradeConnect, on the other hand, has laid out an economic model that rewards rather than penalizes frequent users of its platform.
Instead of traditional commission, we will charge a Connect Fee, much of which will go directly to the network.
Twenty-five percent will cover the running costs of the platform, with the remaining seventy-five percent rebating directly to market makers and takers. Users of the network will be directly rewarded and incentivized for their participation — a brand-new approach that will incentivize traders to turn away from traditional brokers.
A new era ahead for the global trading scene
With a combination of improved security, technology and significant financial incentives,
TradeConnect is set to bring radical changes to financial systems. Alongside the benefits to traders, however, markets themselves will likely experience a transformation. The platform’s design as a global network, as well as its easy-to-use mobile trading app, will vastly expand financial markets as it opens the door to many individual traders and market participants. Equally, with increased volume will come increased liquidity, which combined with fast settlement of trades promises to offset the risks of huge swings in market behaviour.
It’s early days still for TradeConnect and ThinkCoin — the project is currently in its Pre-ICO stage. However, with the team’s extensive extensive previous success in this industry and the current roadmap opening Alpha testing this month, we might not have to wait long to welcome a new era for financial markets.
