Nineteen years ago Jeffrey Sprecher paid $1 for Continental Power Exchange. Growing that test bed for electronic energy trading into Intercontinental Exchange, which in the first quarter of 2016 set records for revenue ($1.2 billion) and net income ($369 million), required quite a few leaps and bounds, not least the 2013 acquisition of NYSE Euronext for $11 billion. But the journey was methodical, if not entirely linear, as Sprecher assembled his global complex of 11 exchanges serving nine asset classes, along with six clearinghouses. Methodical, too, is the ICE chairman and CEOs approach to the blockchain technology that many financial industry executives are trying to make sense of. A lot of institutions in financial services are talking about how to deploy blockchain, Sprecher, 61, says. But the real value may be in the work toward common standards, a common vernacular. Among the obstacles that blockchain, or distributed ledger, technology must overcome are laws and processes predicated on the existence of a definitive golden record for any transaction, he notes. We will see an evolution rather than a revolution, but the work being done is interesting, as it has the industry talking about how to take costs out of the settlement system, he explains. To do that, the first thing we have to do is agree to a common set of standards. In the here and now, the New York Stock Exchange in May officially launched Pillar, its unified technology platform for equities and options. Were getting better matches, better uptake from the industry, and were growing our market share, Sprecher says. Equity trading has evolved to the point that people thought more complexity would help. Frankly, we didnt understand the complexity, and we said, Lets not do it,? opting instead to build a simpler architecture from scratch. ICE is also implementing an instant messaging system for traders to communicate within the bounds of compliance requirements and developing clearinghouse risk models. In June, six months after acquiring Interactive Data Corp. for $5.2 billion, ICE combined IDC and other data and analytics assets in an expanded ICE Data Services subsidiary to offer clients a more complete, consolidated view of the markets, according to Sprecher.
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