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Don’t let your trading platform be the single-point-of-failure

Many entrepreneurs often ask themselves what is most important for any company to survive in an ever-changing environment. The answer is simple; you need an effective business continuity plan that can adapt easily to the conditions. It may seem that there are companies just ‘too big to fail’ or entire industries that seemingly are not exposed to any risk. But experience has shown that no business is bulletproof.

One of the industries that can be perceived this way is the technology industry. We know market giants such as Facebook, Google and Microsoft, which have been developing their products for many years and whose hegemony seems to be unchallenged. However, even with such giants, regulatory, tax, and political risks have already materialised more than once at the least expected moment. The companies mentioned above often had to explain their conduct before antitrust or tax offices and even before US Senate committees, which often led to high financial penalties or forced them to limit their activities in a given area, or even to leave some markets.

Even giants have their issues

We should look at our company through the same prism when drawing conclusions from these examples. The Forex industry is more exposed to these risks than the technology industry. Predicting the worst for our own company is not something we like to do. Still, it is often necessary because it makes us aware of what can happen when we are too dependent on specific legal conditions, technology suppliers and other dependencies that may affect the survival of our business. There are also hegemonic companies in the Forex market, like Microsoft, in the operating system market, but is it reasonable to rely on only one technological solution, which, although the most popular, also exposes us to a significant risk? “Single-point-of-failure” was coined in the IT industry for a reason. It identifies critical points that may cause the entire system to stop working. In the case of Forex Brokers, such a critical point is definitely the technology they use simply because, without it, no Broker can offer services to their clients. This is especially important if the technology is provided by an external supplier who also bears the risk associated with its own business.

Lack of preparation can be costly

In the industry, there are often examples of multi-million brokerage businesses based on the most popular technology without any security in the form of an alternative platform. And so, in the case of sudden problems, like the turmoil that has recently swept the industry, these Brokers record double losses. First, they have nowhere to onboard new customers, and existing customers will have limited access to app updates. The second, equally important aspect is that their lack of preparation helps the competition take over the entire flow of new customers. The impact of disseminated misleading information and gossip exacerbating the crisis cannot be underestimated either. Therefore, all aspects (internal and external, technological and reputational) must be considered when analysing the risks. It should be emphasised that, for example, many large Brokers have more than one license to conduct their business, which significantly reduces legal and regulatory risk. The same kind of forethought should apply to the technology.

Modern brokerage requires a modern trading platform

At Match-Trade Technologies, we offer a range of products that can help Brokers ensure an effective business continuity plan regarding technology, payment solutions and liquidity. One of our flagship products is the ultra-modern Match-Trader platform, which combines all the benefits of trading on desktop and mobile devices (Windows, iOS, Android). Our platform is offered as a standard White Label solution and a Server License, a fully independent environment that can be adapted to the needs of any Broker using many available APIs. It was developed using the PWA technology, which means we can offer each Broker their own branded app (with logo and Broker’s chosen name) available to download from App Store and Google Play. No bulk app means no collective responsibility. Another interesting example of a modern approach used by our company may be the Single-Sign-On solution between CRM and the trading platform, providing only one login for the client. It should be a standard in the Forex market for a long time; however, due to the popularity of one well-known platform that does not support this solution, it is mainly used by Brokers with their trading platforms. We can easily compare what technological gap begins to divide even the largest Forex Brokers who use old but popular trading platforms and the Crypto market, which is free from the so-called legacy technology solutions.

Have you ever considered why companies such as Plus500, eToro, X-Trade Brokers and Trading212 have been so successful in recent years? I think this is mainly due to a modern approach to the new generation of customers (gen X and gen Z or even millennials) who do not want to use complex systems they just don’t get. Therefore, intelligent diversification of technological solutions, apart from ensuring business continuity, may also be a new development impulse. It can enable entering new markets or reaching new customer groups previously unattainable because of outdated technological solutions.