Cboe FX 2024 Recap and Look Ahead

The Cboe FX Team recently sent a note to customers reflecting on the accomplishments of the Cboe FX Team in 2024 and a look ahead to 2025.

As we start 2025, we wanted to reflect on our key achievements during 2024 and provide a preview into what you can expect from us in the coming 12 months to support your FX trading needs.

The past year included several significant market-moving events, ranging from global elections to geopolitical unrest and shifts in central bank monetary policy, resulting in considerable market volatility.

Cboe FX rose to the challenges these events presented: Our systems demonstrated exceptional resilience and handled all-time record volumes, affirming our status as one of the leading institutional FX platforms. We continued to invest in our products and technological scalability, and also made significant strides in our diversification efforts, particularly with our Non-deliverable forwards (NDF) and U.S. Treasuries platforms – both of which achieved record annual volumes.

These milestones would not have been possible without your unwavering support, feedback, and counsel throughout the year. We extend our heartfelt thanks and look forward to collaborating with you in 2025.

Volume Highlights – Records across the board

A few volume highlights include the following:

• We achieved a record average daily volume (ADV) of $45.4bn in spot products during 2024, which translated into a 19.6% market share, and a 4.0% increase versus 2023 ($43.6bn).
• Our Full Amount offering, which provides clients with a solution for larger order execution with low market impact, had another strong year. Spot Full Amount trading ADV was $13.7bn during 2024, compared with averages of $13.7bn and $12.3bn in 2023 and 2022, respectively. This included a new daily high of $32.8bn on November 6^th.
• NDF trading on Cboe SEF, our swap execution facility, were also at record levels, with an average ADV of $1.4bn during the year, compared with averages of $1.1bn in 2022 and $836mn in 2022.
• The share of firm, instantly executable volume continues to grow on our ECN. We reached a record 48.1% in 2024, surpassing 2023 (47.9%) and 2022 (43.7%).
• We also gained traction with our newer U.S. Treasuries platform. We have 13 firms papered with us and, following our first trade in October 2023, had a  a record day of $599mn on June 13^th.

Product and Technology Enhancements – Investing for future growth

We continued to improve our products and technology during 2024, improving our resilience and increasing capacity for our future growth in the months and years to come. Some of the highlights included:

• Technology Enhancements: Following a multi-year effort, we completed the re-architecture of our Spot FX matching engine. This included splitting our ECN matching engine by currency pairs to more efficiently load-balance message traffic and removing any inter-dependencies between our ECN and Full-Amount offerings, resulting in a meaningful reduction in latency and improved resilience.
• Cboe Split: As a result of the matching engine split, we were able to launch dedicated currency pair-specific real-time ITCH market data feeds. These feeds offer faster throughput and a meaningful reduction in average and median market data update times compared to legacy ITCH feeds. They are available for spot ECN sessions in both our New York and London data centres.

Advocacy – Committed to better FX markets

In keeping with our commitment to advancing the FX market for the benefit of all participants, we have taken an active role in advocacy, including the following:

• FXPA White Paper: Cboe FX was proud to have contributed to an important paper published by The Foreign Exchange Professionals Association (FXPA) in September, on the regulatory landscape for OTC FX derivatives trading venues. This paper highlighted the benefits of trading FX derivatives, such as NDFs, on regulated venues.
• European Central Bank (ECB) FX Contacts Group: Cboe FX also was selected to the ECB’s Foreign Exchange Contacts Group, which provides a forum for discussion on FX market structure, issues, and trends, as well as establishing a dialogue between the ECB and market practitioners. This is a testament to the growing relevance of Cboe in the FX ecosystem. James Arrante will be representing Cboe FX on the committee.

Our Focus for 2025 – Diversification will be centre stage

Looking ahead to this year, we remain committed to leading with transparency and taking an ever-more prominent position in the FX venue ecosystem.

• Maximum Hold times: In line with our commitment to transparency and innovation, we recently announced that we will be requiring liquidity provider response times on both our Spot and NDF platforms to be a maximum of 20ms from April 1, down from 35ms currently. This will be further reduced to a maximum of 10ms from October 1 to advance industry standards and ultimately help improve outcomes for liquidity consumers.
• Market Data: Given our position as a market leader in spot FX, we plan to offer unique market data products that will complement our trading services. Stay tuned for further details on these.
• NDF Growth: We will continue to focus on further growing our Cboe SEF NDF platform, following its record breaking 2024. This year has already got off to a strong start with the platform’s all-time top three trading days each occurring in January so far, with an all-time high of $3.75bn traded on January 14. The platform now has the same range of functionality as our spot markets – including Full Amount and Hidden Pegs – and our focus will be on encouraging adoption of these order types. Other changes include: *We are planning to introduce a credit intermediary model later in the year, facilitating trading for clients who don’t have access to credit and broaden the range of participants on our platform. *Effective April 1, all market makers on our SEF will be required to have adhered to the FX Global Code, mirroring what we enforced for our Spot ECN and Full Amount platforms in 2023.
• UST Expansion: We are also excited to drive further growth and adoption of our interdealer U.S. Treasuries trading platform, having laid strong foundations during 2024. We continue to receive positive feedback on this initiative to introduce an innovative dealer-to-dealer Full Amount platform, addressing a market need for effective large order execution that is not currently met by incumbents. Having initially focused on attracting participants that are members of the DTCC’s Fixed Income Clearing Corporation, we will be now extending the service to firms beyond that group, including non-bank participants.

We are grateful for your business and continued support, and look forward to working with you in 2025.

Sincerely,

The Cboe FX Team