Real-time Blockchain transactions, ensure accurate trades & compliance
The last few years have seen an unprecedented boom in the cryptocurrency market along with an ever expanding array of regulatory and compliance mandates. To thrive in the competitive cryptocurrency market, digital asset exchanges and technology providers must execute transactions not just at blazing fast speeds, but also at scale, while strictly maintaining accuracy throughout the entire lifecycle of blockchain-based digital assets.
The world’s established financial markets have perfected the science of high-frequency trading over the years. And now crypto asset markets which consist of: funds, exchanges, options, trade-bot API’s, and brokers are following suit. According to Investopedia: “High-frequency trading (HFT) is an automated trading platform used by large investment banks, hedge funds and institutional investors that utilizes powerful computers to transact a large number of orders at extremely high speeds. These high-frequency trading platforms allow traders to execute millions of orders and scan multiple markets and exchanges in a matter of seconds, thus giving the institutions that use the platforms a huge advantage in the open market.” Cryptocurrency HFT (similar to hedge fund trading) utilizes algorithmic trading to make millions of completely automated trades multiple times during the day that are subject to massive market surges that can execute millions of trades in a single second on a single platform. In addition to HFT dark pools are also becoming popular in the crypto trading markets. Dark pools are private trading platforms that enable buyers and sellers to execute trades that are hidden from other investors.
Cryptocurrency trading although still in its infancy, has already proven to be extremely volatile relative to other established financial markets. The adoption of HFT and dark pools has raised the frequency and volume of cryptocurrency trading even further, making it increasingly harder to execute high volume trades consistency and on time, while maintaining regulatory standards. The greater interest in cryptocurrencies, along with the sudden and extreme spikes in trade volume caused by increased volatility poses a unique challenge for asset exchanges and their technology providers.
The need for transactions to be completed at high speed and with ACID compliance drives the need for a solution to process user information accurately and at scale in real-time, while continuously recalculating exposure and assessing risk appropriately, and checking for compliance (AML, KYC, etc.). Unlike other databases; VoltDB was architected for real-time without compromising on ACID semantics. Only VoltDB can offer all of the capabilities that are necessary to power modern cryptocurrency trading platforms, including:
Cryptocurrency trading requires the analysis and execution of trades in milliseconds, a latency of a mere millisecond could lead to potential losses of millions of dollars. The need for real-time transactions is very real, and VoltDB provides just that. With its in-memory distributed architecture along with built-in stored procedures, User Defined Functions, and materialized views; VoltDB has been powering demanding financial instruments and cryptocurrency trading platform for years now. Read more about VoltDB’s real-time architecture.
- Strong ACID
A survey conducted in partnership with Research Now confirms that for financial data (such as cryptocurrencies) having consistent critical data transactions is vital to their business; without compromising on speed. To maximize profit, you need to have the correct price information quickly. Inconsistent data here means that you lose out on potentially large profits or make bad trades. Regulatory requirements also require trading platforms to transactional data correctly and quickly, failing to meet compliance could lead to losing your trading license. VoltDB partitions run independently and provides for the strongest ACID semantics available; ensuring that data is always accurate and reliable. While, NoSQL solutions offer “eventual consistency”, which means that the likelihood of getting an incorrect response to a query at at given time if high, this is simply not acceptable for any financial services use cases.
- Scale & High Availability
Demand for cryptocurrency coupled with volatility causes high trading volumes along with unpredictable spikes resulting in millions of transactions per millisecond. The embedded database within the trading platform needs to scale linearly to accommodate for trade volume spikes, while continuing to deliver predictably low latency, and remain highly available. VoltDB automatically partitions data across the cluster, keeping multiple copies of all data to ensure high-availability and data safety. Partitionable transactions are scaled linearly with cluster size. So just how scalable and fast is VoltDB? A recent benchmark performed on a demanding telecom grade app with XDR data showed VoltDB can easily scale beyond 3 Millions transactions per second with under 3 milliseconds of 99% predictable latency.
- Embedded Machine Learning
HFT employs algorithmic trading programes that enable traders to make thousands of completely automated trades in real-time, often multiple times in the trading day. VoltDB can operationalize complex Machine Learning algorithms in real-time with in-database Machine Learning. VoltDB automatically converts a PMML model into an executable process as a User Defined Function that can apply the pre-defined complex logic to take real-time actions on high volumes of fast streaming data. While, pre-compiled server-side stored procedures make the in-memory database execution times even faster; by running complex logic on cryptocurrency transactions at scale and with ease.
- Cloud ready
Cryptocurrency exchanges are cloud native. VoltDB is architected to provide horizontal scale by clustering on commodity hardware, with hardware and networking fault-tolerance built-in. This ensures seamless operations on any of the public clouds (AWS, Microsoft Azure, Google Cloud Platform, Alibaba, etc) or even private or hybrid clouds.
- Familiar SQL
At its core; VoltDB is a fully ANSI SQL compliant relational database. Support for standard SQL ensures ease of use and fast deployment.