FIX to Support Digital Assets

The FIX Trading Community empowers individuals and firms to collaborate and ensure the work of the community is complete, robust, and fit for purpose, for the entire industry. This has been achieved by FIX Protocol being supportive of nearly every conventional class of financial instrument, so it only follows that FIX should also support digital asset trading.

Just as FIX has reduced costs for the traditional financial industry, a FIX standard for digital assets would significantly reduce the technical friction and cost for traditional financial industry participants to interact with newer crypto exchanges. Pre-trade efficiencies in market data and quoting, and post-trade efficiencies in trade reporting and settlement would be possible, serving market data vendors, buy-side institutions, and custodians. Regulators could more easily track the new digital asset landscape if they could leverage the same reporting infrastructure employed within traditional asset classes.

The FIX Digital Asset Working Group (DAWG) is well positioned to advance this goal. FIX Trading Community began its life in 1992 as an equities protocol, but since then has expanded to include equity options, fixed income, forex, listed derivatives, and a wide range of OTC products. FIX already has a modular data model for assets and parties, and a rich message catalog for transaction workflows, including orders and executions, market data, reference data, and trade reporting.

In 2018, the DAWG began a gap analysis process to produce a recommended practice guidelines document for trading digital assets between Buy-Side and Sell-Side firms, with the intention that an Exchange recommended practice guidelines document would follow. While Distributed Ledger Technology and blockchain may be groundbreaking, very little in the FIX Protocol actually needs to change to support digital assets. Read full article here..