Former CQG President Reflects on Algo Trading, Crypto, and AI’s Impact

May 31, 2024

John Lothian

John Lothian

Executive Chairman and CEO

May 31, 2024

Part Three of an Interview for The Path to Electronic Trading Video Series

Elmhurst, IL (JLN) – Josef Schroeter, the former president of CQG, a provider of trading software and market data, shared his insights on the evolution of electronic trading, the rise of crypto, and the potential impact of AI in part three of his interview with John Lothian News for The Path to Electronic Trading video series.

Discussing the advent of algorithmic trading, Schroeter said, “When I look at trading, I see it in three shifts: trading 1.0 was the interfaces, 2.0 was the advent of algo trading, and the third is what we’re seeing now.” He highlighted how algo trading enabled traders to execute orders without constantly monitoring the system, driving a surge in trading volumes. “The better you became at providing algo technology, the more players you could provide for, and the more needs they had,” he added.

On the topic of cryptocurrency, Schroeter expressed skepticism about its underlying value but acknowledged its momentum. “It’s difficult for me to understand what can drive the underlying value of it,” he said. However, he predicted that major firms like CQG would offer crypto trading “in a predictable, stable way” to meet market demand.

Regarding AI’s impact, Schroeter emphasized its potential for boosting productivity. “The productivity boost that we got by using AI from our developers was close to double,” he revealed, citing a recent project integrating ChatGPT into a product. However, he cautioned that AI’s impact on trading algorithms would take longer to develop and would still be bound by market rules and regulations.

Looking ahead, Schroeter anticipated increased regulation for technology firms like CQG in the coming years. “I think over the next 3 or 4 years, you’re going to see a lot more regulation come directly on technology players,” he stated.

With his extensive experience in capital markets, Schroeter underscored the importance of managing change and adapting to evolving ecosystems. “The community is becoming an ecosystem,” he said. “You can’t just provide one aspect of the service anymore.”

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