JLN Podcast: Navigating Fintech’s Evolution: Liquiditybook’s Journey Through Technological Advances and Regulatory Shifts

Split image featuring two men in video calls with logos for "jln interview" and "liquiditybook podcast," and a central graphic with text and company logos.
John Lothian

John Lothian

Executive Chairman and CEO

The fintech landscape has seen a remarkable evolution over the past decades, marked by technological advancements and regulatory changes. That progress and those obstacles were opportunities for firms like Liquiditybook to automate workflows and establish itself as a dependable partner to a diverse group of market participants. John Lothian News interviewed Terrence Cheung, director of post trade product management, and Shawn Samuel, CTO of LiquidityBook, in this podcast about its history and how it is managing the quickly shifting technological and regulatory landscape.

Terry Cheung, who has been with LiquidityBook for 2 years, is a veteran in the fintech industry with 18 years of experience who sheds light on this journey as he discusses the firm’s trajectory and its adaptation to emerging market needs. He is joined in this podcast by LiquidityBook’s chief technology officer, Shawn Samuel, who with Cheung addresses the firm’s origins, dating back to its inception in 2005. 

LiquidityBook started with a small team at a broker-dealer and grew organically as it started to use technology to solve its own problems, Samuel said. The first problem LiquidityBook addressed involved automating straight through processing, from trade conception to order entry, order management, execution to post trade, he said. The idea was to automate anything they could in that process, to eliminate risk and save traders money that could help keep them from going out of business, Samuel said.

They started with a FIX networking and evolved to what they are today, “a full end-to-end system for everything, for all market participants in the front office, from order management to execution management to portfolio management to post trade in (the) middle office,” Samuel said.

Another aspect of LiquidityBook’s work was replacing legacy systems that were “heavy, slow, hard to work with,” he said. Samuel expounded on different examples of how LiquidityBook’s newer, more powerful technology allows traders to move faster, while also seeing real-time data powered by APIs. 

LiquidityBook offers a managed service to clients, which allows it to configure the system to meet the client’s needs, rather than forcing the client to become an expert in the solutions offered by LiquidityBook, Samuel said.

Cheung says that with the move to T+1 all the steps of clearing a trade will be much quicker, with brokers asking clients to send instructions electronically, if possible. Executing brokers will also try to simplify their workflows so they can send out the confirmations as early as possible so they get to the custodian firm to confirm by 9:00 p.m., he said.

Cheung said he expects artificial intelligence (AI) will impact the sell side broker serving the buy side trader, who might send in a basket of 50 stocks, but send them individually. Using AI, the sell side broker can identify other 50 lot trades with the same stocks and be prepared to allocate the trades the same way as the first trade, thus speeding up the workflow, Cheung said.

Also, if a client trades a particular stock the day before, using AI, when the client trades the stock the next day, the firm can project the account the trades will be allocated to, he said.

Cheung laid out the history of settlement of stocks from T+5 to T+1 for the podcast, noting when Europe and Canada made similar moves. On the Monday of Memorial Day, Canada and Mexico will move to T+1 and then Tuesday the U.S. will move to T+1. 

The last time there was a move in settlement days, Europe moved first. This time it is the U.S., Canada and Mexico. Cheung said he expects the rest of the world to catch up quickly in the next few years. He said he hopes we can get to T+0 in fewer than 10 years. 

Other topics explored in this podcast include:

  • Transition from T+2 to T+1 settlement cycle
  • Historical timeline of settlement cycle changes (Europe, US, Canada, Mexico)
  • Client concerns and adaptation to settlement cycle changes
  • Importance of liquidity and counterparty interaction
  • Role of customer support in adapting to changes
  • Comparison of T+1 transition to Y2K
  • Challenges and benefits of automation in settlement processes
  • Impact on broker operations and trade allocation
  • Broker scorecards for T+1 compliance
  • Automation and technology solutions for T+1 transition
  • Role of AI and machine learning in settlement processes
  • Future skills and training for back office personnel
  • Impact of technology on the financial industry
  • Future plans and challenges for liquidity book in 2024
  • Focus on leveraging new technologies (Gen AI) internally
  • Expansion into different asset classes and services
  • Importance of straight-through processing and automation
  • Post-trade hub concept for faster processing and reconciliation
  • Challenges and solutions for onboarding and interfacing with clearing brokers
  • Optimization of reconciliation processes for efficiency


Crisis memory, geopolitics and the risks of financial contagion

Crisis memory, geopolitics and the risks of financial contagion

First Read Hits & Takes John Lothian & JLN Staff When Jack A. Wing died in 2011, I realized the industry was losing some of the pioneers of the financial futures era. Wing founded the masters program in financial engineering at the Illinois Institute of Technology,...

We visit more than 100 financial news websites daily (Would YOU do that?)

Options Discovery

The Stock Market Has Rarely Been This Sleepy

Lead Stories The Stock Market Has Rarely Been This Sleepy Gunjan Banerji - The Wall Street Journal It's eerily calm out there in the stock market. The Cboe Volatility Index, or VIX, dropped below 12 last week, a nearly five-year low. The gauge, based on options prices...

Now Read This

Regulatory Uncertainty Clouds Options Market Innovation

Regulatory Uncertainty Clouds Options Market Innovation

David Dooman, head of options at Dash Financial, a subsidiary of ION Group, expressed concerns about the impact of regulatory uncertainty on the options markets during an interview at the Options Conference in Asheville, NC.  Dooman highlighted several key issues stifling innovation and offered recommendations to address the industry’s challenges.

John Lothian: Week in Review (June  10-14, 2024)

John Lothian: Week in Review (June 10-14, 2024)


The role of the FCM: Futures Discovery EP 10

Today, we’re immersing ourselves in a detailed exploration of the pivotal role of Futures Commission Merchants, commonly known as FCMs. These financial intermediaries play a crucial role in facilitating futures and options trading, serving as a linchpin in the complex web of derivative markets. Understanding the intricate responsibilities and functions of FCMs is essential for navigating the dynamic landscape of modern financial systems.

A Milestone in Indexing: FTSE Russell Celebrates 40 Years of the Russell US Indexes during Russell Reconstitution

A Milestone in Indexing: FTSE Russell Celebrates 40 Years of the Russell US Indexes during Russell Reconstitution

Elmhurst, IL (JLN) -In a recent roundtable, we spoke with Catherine Yoshimoto, director of product management at FTSE Russell; Paul Woolman, Managing Director – Global Head of Equity Index Products from CME Group; and Rick Rosenthal, Managing Director – Global Head of Equity Index Products at Cboe Global Markets. They shared insights on the significance of this year’s Russell Reconstitution and its implications for market participants.

Connamara CEO Prioritizes Regulatory Compliance for Exchange Clients

Connamara CEO Prioritizes Regulatory Compliance for Exchange Clients

Boca Raton, FL (JLN) – Jim Downs, CEO of Connamara Technologies, a provider of exchange infrastructure technology, emphasizes the importance of regulatory compliance for clients during an interview at the FIA’s International Futures Industry Conference in Boca Raton, FL. Connamara’s customer base consists of 40% regulated entities in derivatives and equities markets, with the remaining clients ranging from crypto infrastructures in the US to an equity platform in Brazil, Downs said. Downs highlighted that even unregulated clients aim to operate as if they were regulated, maintaining rulebooks and prioritizing brand reputation, he said.