Clear Street’s Bold Move: Former Cboe Chairman & CEO Ed Tilly Joins Fintech to Revolutionize Clearing and Custody Systems

Image featuring two men, one labeled Chris Pento and the other labeled Ed Tilly, alongside the JLN logo. Text below reads: "Clear Street's Bold Move: Former Cboe Chairman & CEO Ed Tilly Joins Fintech to Revolutionize Clearing and Custody Systems.
John Lothian

John Lothian

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Clear Street, a fintech startup founded in 2018, is making waves in the financial services industry with its ambitious plan to revolutionize clearing and custody infrastructure and its big-name hiring of former Cboe Global Markets Chairman and CEO Ed Tilly. In an interview with John Lothian News, CEO Chris Pento and President-Designate Tilly outlined the company’s vision and progress.

The New York-based firm has set out to tackle a problem that has long plagued Wall Street and its LaSalle Street sibling: outdated clearing systems. “We started with the belief that the infrastructure operating most brokerages across the street was running on old, archaic infrastructure,” Pento said. 

Clear Street’s solution is a single cloud-native, event-driven platform that offers real-time processing across multiple asset classes. This stands in stark contrast to the legacy mainframe systems that require lengthy overnight batch processing. “We are a full-functioning broker dealer with our own technology stack,” Pento said.

The company has made significant strides since its inception. With a team of 450 employees and nearly $1 billion in raised capital, Clear Street is now profitable and generating over $250 million in annual revenue. The firm has launched operations handling equities, options, and futures in the U.S., and is now setting its sights on global expansion.

Tilly was named president yesterday and officially starts with Clear Street on July 22 to spearhead this international growth. The company is currently pursuing regulatory approval in the UK and plans to expand into other European markets and Asia.

Clear Street’s approach has garnered attention from both clients and talent. The firm has attracted high-profile hires from major banks, including Goldman Sachs and Morgan Stanley. “People want to be involved,” Pento said, highlighting the appeal of working on cutting-edge technology in an industry ripe for disruption.

The company is targeting three core business segments: professional clearing, prime brokerage, and active trading. In the professional clearing space, Clear Street aims to provide a much-needed alternative in a market dominated by just a few legacy providers, especially in equity options. That is a market Clear Street and Tilly know well.  

The active trading segment, sometimes referred to as “protail,” a portmanteau of professional and retail, is an underserved part of the market impacted by the closing of the trading floors and consolidation of firms servicing floor traders. Protail traders may lack the sophisticated business structures of hedge funds or proprietary trading firms, but they are sophisticated traders in need of similar brokerage services. 

Clear Street is a member of DTCC, OCC, CME, ICE Clear US and Nodal Exchange, Pento said. It has applied to ICE Clear UK also. 

While other firms are enamored with opportunities in high frequency trading or cryptocurrencies, Clear Street sees huge opportunity in the clearing side of the business. Its approach is to bring its core technology stack to new markets and bring the same advantages to new markets as its existing ones. This strategy feels awfully familiar, like Cboe Global Markets rolling out its trading platform for a common customer experience at all the markets it acquired around the world under Tilly’s leadership. 

“Our goal was to take what we built and then replicate that in a scalable and replicable way so that our clients who are global clients can then use this, not just in the US, but in Europe and in Asia,” Pento said. “We need to think globally. And our clients are demanding that. And that’s why we got to start thinking about becoming more global oriented,” he said, referring to the reasons Tilly was brought onboard. 

Clear Street is watching the cryptocurrency sector closely, but it’s taking a cautious approach. “We’re waiting to see what the regulatory framework looks like before we make a big move,” Pento said. 

As Clear Street continues to grow, it faces the challenge of balancing rapid expansion with the need for additional capital. While the company has sufficient funds to meet its goals through 2025, Pento acknowledged that further fundraising may be necessary to support long-term ambitions. He said future fundraising could include debt, rather than equity, and that Clear Street wants to do it right. 

Clear Street already has key strategic investors from the industry, including IMC Investments, Belvedere, and Walleye Capital, in its latest B fundraising round. 

The ambition to grow the right way has attracted talent to the firm. Tilly said, “There’s a fever here,” acknowledging the firm’s desire to impact the industry. “The team has come from all over the street with incredible backgrounds, but the focus is pretty single minded,” Tilly said. 

In an industry where change often comes slowly, Clear Street’s bold vision and technological approach are turning heads. I know its hiring of Tilly caught my attention.  As the multi-asset class financial services landscape continues to evolve, more eyes will be on this ambitious startup and its bid to reshape the foundations of Wall Street infrastructure.

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Clear Street’s Bold Move: Former Cboe Chairman & CEO Ed Tilly Joins Fintech to Revolutionize Clearing and Custody Systems

Clear Street, a fintech startup founded in 2018, is making waves in the financial services industry with its ambitious plan to revolutionize clearing and custody infrastructure and its big-name hiring of former Cboe Global Markets Chairman and CEO Ed Tilly. In an interview with John Lothian News, CEO Chris Pento and President-Designate Tilly outlined the company’s vision and progress.

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