The NASDAQ OMX Group, Inc. (NASDAQ:NDAQ), The Charles Schwab Corporation (NYSE:SCHW) – Blue Ocean Technologies CEO Says 24-Hour Stock Trading Is Coming
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Today’s conversation is with Brian HyndmanPresident and CEO of Blue Ocean Technologiesthe company that lets people manage risk in the stock markets around the clock.
The following text has been edited for clarity and brevity.
Q: Hi Brian, nice to talk with you. Tell me a little more about yourself.
Brian Hyndman: I got into e-commerce in 1998 when we started Brut ECN, and we were competing with the established exchanges.
Nasdaq Inc. (NASDAQ: NDAQ) eventually acquired us in 2004, and at Nasdaq I was responsible for managing the exchange platform, as well as product and business efforts.
We ended up acquiring the island’s ECN, as well as the Boston and Philadelphia stock exchanges, which put the Nasdaq on the map. It used to be a quasi-governmental agency, falling behind in technology and losing market share to startups.
When the Nasdaq got back in the driver’s seat, I moved on and ran their global data business. I more than doubled revenue to $550 million six years later and eventually found my way to Paxos, a top crypto company.
When did Blue Ocean come on the scene?
After three years as a Senior Advisor at Paxos, I came across the guys at Blue Ocean who needed to raise capital. I was intrigued by the idea that US stocks trade around the clock.
I joined and we raised $10 million from Urbana. Over the past year, we’ve proven the model that global investors want to be able to manage their risk around the clock.
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Tell me a bit about the infrastructure and how, as a retailer, I can access markets any time of the day.
First, we are a Registered Alternative Trading System (ATS) approved by the Securities and Exchange Commission (SEC).
Anyone who is a FINRA-registered broker can access the platform.
It’s like the Nasdaq system. The Nasdaq cannot go straight to retail. They have to go to the broker like Charles Schwab Company– owns (NYSE: SCHW) TD Ameritrade, through which retail trade then passes.
If a retail investor is on your platform and wants to connect, they go through this FINRA-registered broker who subscribes to our Blue Ocean ATS.
What is the motivation behind 24/7 trading?
Back then, when I was at the Nasdaq, I wanted to start trading 24 hours a day, but the people at the big investment banks wanted to go home at 5 p.m.
The world has changed and now everyone has the infrastructure in place thanks to crypto and their overseas offices in Hong Kong and Singapore.
We have a transparent asset class, trading maybe 12.5 billion shares in a six and a half hour period. We believe that giving investors, for example in Asia, the ability to trade during their daytime hours would add significantly to this liquidity.
I have it on the tech side. You still need humans to use this technology, don’t you?
Yes, you need teams in place – eyes on the glass – reviewing connections, logs, and answering questions a particular customer may have.
What are some of the biggest benefits of this extended trade?
Risk management. If there is a geopolitical event on a Sunday evening, people don’t want to wait until Monday morning to reposition themselves.
I’m sure there are opportunities to monetize in other ways as well. Can you discuss it?
Data trading is lucrative.
If we are the only player operating from 8:00 p.m. to 4:00 a.m. which will be the longest time frame for any trading session, you can imagine the data we are going to produce is very valuable and if we can get it to more sites , it will make our company more credible.
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