I was determined not to write anything about FXMarketSpace (FXMS) this week. But following my analysis of its volumes last week, I have had a fair amount of correspondence with Mark Robson, the fledgling platform’s chief executive.
“I notice in recent months that you seem to have come to the conclusion that our FXMarketSpace platform has no real differentiation; and not unexpectedly, I see it differently,” Robson wrote to me in an email. “You seem quite open minded, so I’ll just relay a couple of key customer issues that repeatedly were brought to my intention when I used to run Reuters electronic brokerage business:
“1. Many regional and domestic banks felt locked out from trading on the Reuters and EBS central limit order books because banks would not extend sufficient bilateral credit lines for them to participate. They didn’t like the alternative of becoming prime brokerage customers into EBS and Reuters because they felt that this effectively meant they were withdrawing from having a real presence. They wanted to compete on a level credit playing field. How often do you speak to such smaller regional and domestic banks around the world?
“2. Many high-frequency trading customers complained that the existing EBS and Reuters platforms were architecturally antiquated (restricting their interest in using them) and asked for a more powerful platform to execute on.