Quoine: Understanding Prime Brokerage And Its Benefits To Liquid Users
Crypto traders can have access to trade on several top exchanges without having accounts with them in as much as they are on Quoine’s Liquid platform. This means that they can have access to any exchange’s liquid despite the fact that these top exchanges only offer their liquid to their clients. This is a very important thing that will end up getting rid of the limitations that liquidity is facing in the crypto markets. Quoine is able to achieve this on their Liquid platform by creating a network for all major exchanges in the world alongside some minor ones thanks to these two systems; World Book (which we discussed extensively in our previous post) and Prime Brokerage. Let us take a look at Prime Brokerage and how it works with World Book to achieve this.
Prime Brokerage
Naturally, for traders to be able to access any exchange and establish trades with their clients without having accounts with them, they will have to deal with lots of counterparty risks. What if a transaction hangs during the processes? What if something happens to their digital assets? Counterparty Risk would always be in the picture since they do not have accounts on these other exchanges from which their trading pair trades from. However, Liquid is able to reduce this counterparty risk through their Prime Brokerage.
The Liquid platform’s Prime Brokerage is made up of a range of services that provide crypto traders who are on Liquid with several tools to reduce Counterparty Risk and increase ROI. Since the ROI represents the ratio of investment profits and the investment cost (which is made up from the value of both the Base Currency and Quote Currency), having an increased ROI means the trade will be profitable to both parties involved; that is the trading pairs. Liquid’s Prime Brokerage tools include Direct Market Access, Fiat Management, and Credit Facility. With these tools, users do not need to fear the risks associated with trading with other traders who are from other exchanges.
Direct Market Access
Several technologies are working to achieve different goals on Liquid. These goals combined give users the ability to enjoy different services that they cannot get anywhere else, all on the same single platform – Liquid. Like we discussed in the previous post, there are three technologies working hand-in-hand to increase the efficiency of the Liquid platform. These are the Smart Order Routing (SOR), the Matching Engine (ME) and the Cross Currency Conversion Engine (CCCE). The Prime Brokerage allows users to leverage these technologies and connectivity to all top exchanges in the world thereby giving them direct access to the world’s cryptocurrencies markets right on a single platform.
While the Matching Engine is architected to match millions of transactions in a matter of seconds, the Smart Order Engine is the ensuring that there is no delay in the matching process. Although this matching is done in a matter of seconds, the truth is there is a great work going on behind the scenes but these two technologies ensure that the process is done as fast as possible. Users can then access the world’s crypto markets, track and watch coins, monitor the market flow and place orders for whichever trade they want to make.
Fiat Management
Although the FX world is enjoying an incredible $5 billion to $6 billion USD worth of transactions every single day, moving fiat currencies always proves to be a pain in the arm. Moving a large sum of money is not only slow and time-consuming, but it is always expensive as well. In fact, fiat management is one of the most difficult and restricted constraints when it comes to providing liquidity to the market. However, this is not the case with Quoine’s Liquid platform.
Quoine has good resources that can counter the problems that usually delay fiat currency movements. These resources were achieved through the great network of relationships that Quoine has built with several big banks across the globe. Part of the process is that Quoine locates the banks used by major exchanges and ensures that they have accounts with those banks. This helps them in moving funds –near-instantly. So when we have trading pairs from different exchanges, Quoine’s banking resources bridge the gap between the banks used by each exchange by using its connections and relationships with the banks. This ensures that fiat currencies are moved at great speeds and eradicate any delay or constraint that may come their way during transactions.
Some other tools coming through the Prime Brokerage
Crypto/fiat Credit
Crypto/fiat credit facility allows crypto traders to borrow and obtain loans by using their fiat currencies or crypto tokens as collateral. This is a great tool that will pave the way for a lot of benefits. The Liquid platform’s Prime Brokerage is bringing this tool to the platform. This will help users to leverage on credit facility to enhance several other opportunities.
Real Time reporting
Just like we do have on our bank accounts, the Liquid platform’s Prime Brokerage is bringing another tool that will give users access to customized activities reports. This will help us in getting well-detailed information on our account balances and standings for fiat and crypto tokens as well as the transactions that are going on all in real time.
Benefits that Liquid platform's Prime Brokerage brings to the users
Below are some benefits that users gain for trading on Liquid platform thanks to their Prime Brokerage.
Reduction of Counterparty Risk
With the range of tools which are available on the Liquid platform to ensure that users do not have to face too much Counterparty Risk, traders can now trade with a peace of mind knowing that the only counterparty they are facing is their deal with Quoine, the owner of Liquid itself. Quoine’s reputation is of a high standard. Japan’s Financial Agency Service is known to be among the strictest regulators in the whole world. So for them to have regulated Quoine in September 2017 means Quoine is of the highest standard. Hence, having a Counterparty with them is not going to be a problem for users. After all, they have got rid of other Counterparty Risks that could have come from trading with traders of other exchanges thanks to their Prime Brokerage.
Increase in Capital Efficiency
Despite the fact that users will be dealing with other traders from different exchanges, the Liquid platform makes sure that users do not need to move funds directly from one exchange to another. Quoine has the facilities that handle capital movements which also make the movements instant for both crypto pairs involved in a trade.
Netting of Positions
Like I have mentioned in a post where I explained how I trade Steem and SBD and make instant profits without investing more capital; that means I take advantage of some inefficiencies that characterized the sometimes fractured crypto markets. The LIQUID Platform users will have the ability to net positions taken across different trading venues in the same platform.
Previous Posts
- Understanding The Logic Behind Liquid's WORLD BOOK And How Liquid Provides Liquidity In Crypto Markets
- Quoine & Liquid: Why You Should Join This Revolutionary Blockchain
- Quoine: Promoting Quoine And Liquid With Infographics
- Quoine: How Liquid Plan To Solve Volatility Problems And Provide Liquidity In Cryptosphere
- Quoine: QASH Token Reports, Graphics & Memes
- Quoine: Introducing My 5 Stunning Graphics For Social Media Campaign
- Quoine: The Revolutionary Financial Services On blockchain Technology
Get more information about Quoine from the links provided below:
- Project Website
- Products & Services: Liquid and QASH
- Quoine Team
- Quoine Story
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