search
Clear

Centralized Platform for Trading Over-the-Counter Securities

A centralized platform for trading over-the-counter securities that brings holders and investors together, allowing them to bypass intermediaries and trade assets easily and quickly.

Industries
Technologies

About the client

Our client is a trading enthusiast from Eastern Europe who has founded two successful fintech startups. The client possesses long-standing experience in stock trading and professional investment portfolio management. In recent years, his main entrepreneurial interest has been lying in the over-the-counter market and off-exchange trading.

Engagement model

Time & Materials

Solution

Web app for trading over-the-counter securities

Project background

When it comes to over-the-counter securities, it is difficult for an investor to know that they are available for order as the information is usually only accessible on the website of the depository where they are stored. Investing in OTC securities can be a complex process as the interaction between investor and issuer is complicated by multiple intermediaries, the investor’s personal presence is often required to close the deal, and so on.

 

Our client wanted to automate the process of OTC securities trading. He approached us with the idea of building a centralized platform that would connect the security issuer or holder with the investor and automate the process of buying and selling over-the-counter securities.

Project Team

1 PM, 1 BA, 1 Frontend Developer, 1 Backend Developer, 1 Software Architect, 1 QA Engineer

Effort and Duration

18 months

Tech Stack

Target audience

The solution is targeted at two main segments – issuing companies looking to raise additional capital for business development and security holders looking to sell their assets. It is also expected to attract inexperienced investors that would appreciate transparency and intuitive and simple navigation throughout the whole trading OTC journey from registration to money withdrawal.

Solution overview

The main idea of the solution is to simplify and automate the process of buying and selling over-the-counter securities. It’s a web application designed to perform two primary functions:

  • Trading OTC securities
  • Collecting and disclosing reliable information about the security issuers

This is how it works:

  • Issuer or holder declares that they want to sell their securities and adds them to the platform. Securities issuers can reduce the commissions charged for trades by providing information about the company.
  • Investors review the offers of the holders and issuers and make a purchase decision.
  • Investors buy securities and manage their portfolios. Investors can also indirectly influence the demand for securities of specific issuers by leaving reviews.
  • Money and securities are accumulated on the platform’s bank and depository accounts.
  • The internal billing system distributes funds to the users’ accounts according to their shares.

Functional modules and solution main features

The platform consists of client and admins modules. Admins can moderate users, issuers, and assets information, manage content, and analyze business performance.

As for the client module, different options are available. Depending on the user’s goals, they can buy or offer securities.

Investor role functionality:

  • View offers from securities holders
  • Select securities for purchase
  • Pass KYC procedure to access trading
  • Top up account
  • See the purchased securities in the personal account
  • Leave reviews on different issuers
  • Monitor portfolio performance
  • Withdraw securities/money from the platform

Security Holder role functionality:

  • Place securities on the platform
  • Set prices on securities and put them out for sale
  • See the money received on the internal account
  • Monitor portfolio performance
  • Draw out securities from circulation
  • Withdraw securities/money from the platform

If the security holder is also the issuer, they can attach supporting documents that disclose information about the issuing company, or provide some details about the company that may be of interest to potential investors.

Third-party integrations

Project approach

We started with a discovery phase and came up with the solution architecture, crafted software requirements specification document, prioritized features, made a product roadmap and a risk mitigation plan. Then we moved on to the development process that was organized according to the Agile model. Taking into account the prioritized features we divided the building process into several iterations. Each iteration was followed by the demonstration of the developed features to the client and a feedback collection session.

Technical solution highlights

Matching engine

To match buy and sell orders for OTC securities within the platform, we have integrated it with the Exberry Engine. This is a customizable securities supply and demand matching tool that determines the best buy order with the highest price and matches it with the best sell order with the lowest price.

We chose the Exberry engine because it is built on a set of high-quality software components such as order and quote management, transaction cost analysis, latency infrastructure, trade allocation algorithms, RESTful and WebSocket APIs, etc. All of these components are designed to work together to provide a fast and robust, yet flexible tool for the financial markets and allow users to take control of trading.

On-premise servers

Our client did not want to rely on external factors such as internet connection to access the servers but wanted to control all changes, configurations, and upgrades themselves. It was also crucial to eliminate the chance of data vulnerability and completely restrict access to data for everyone except authorized personnel. That’s why we opted for on-premise servers rather than the cloud. This way, our client had complete control over the platform and the data stored in it.

Results & future plans

The Itexus team developed the trading platform in full accordance with the client’s expectations and delivered a robust and intelligent solution that connects investors and securities holders and facilitates OTC trading by enabling the bypassing of intermediaries. It took us 18 months to develop the MVP.

Now we’re preparing to launch the platform in our client’s local market. Once we have gathered data on consumer response, we will introduce enhancements and get down to exploring new markets.

Are you looking to develop a similar solution or just need some expert advice on the subject? We look forward to assisting you in any way we can so feel free to contact us.

Contact Form

Drop us a line and we’ll get back to you shortly.

For Quick Inquiries

Offices

United States

8, The Green, STE road, Dover, DE 19901

Australia

Level 20,109 Pitt Street, Sydney, NSW, 2000

Belarus

20a Internacionalnaya Street Minsk 220037

Name
Company name
Phone number
Text
x