Weekly Roundup

Payment for Order Flow: Five finance professors analyzed 85,000 stock trades they made through five leading retail brokers. The study determined no relationship between paid order flow and price execution.

High Frequency Trading: A new study from a team at Princeton University found that predictability in high frequency trading returns and durations is “large, systemic and pervasive”. According to the study, focusing on the period from January 2019 to December 2020, with ‘minimal algorithmic tuning,’ HFT firms can predict the direction of a trade, over the next five seconds, with 63% accuracy.

Cboe Digital: Cboe Global Markets announced the initial group of firms that intend to become equity investors in the Cboe Digital business. Cboe’s advanced discussions with potential equity partners involve a diverse range of market participants, including retail and institutional intermediaries, liquidity providers, and brokers. These firms include B2C2, DRW, GSR, Hidden Road, IMC, Interactive Brokers, Jane Street, Jump Crypto, Optiver, Robinhood, tastytrade, and Virtu Financial.

Crypto Returns: According to data from a Pew Research Center survey, 46% of adult crypto users in the United States are seeing lower than expected returns on their crypto investments. Only 15% of respondents said their crypto investments had done better than expected.

Twitter Scrutiny: In June, the SEC pressed Twitter for more information on how the company identifies spam accounts, adding to scrutiny over the platform’s processes for keeping tabs on its user base. The query, which was made public on Wednesday, centered on statements in the firm’s latest annual report that spam and bot accounts make up less than 5% of its user base.

In the Mix: This Week’s Top FinTech Thought Leader

  • Jonathan Yam joined Nadaq as its new Chief Technology Officer. Yam will lead software development and infrastructure globally. He will continue the expansion of the technology team to help support the company’s ability to deploy transformative trading technology that offers global connectivity for financial services providers through a common marketplace.

  • Sam Bankman-Fried, founder and CEO of FTX, has spent over $1 billion this year to save crypto companies heavily impacted by the months of market downturns. This includes $648 million of his own money to buy a 7.6% stake in Robinhood Markets.

  • Marija Zivanovic Smith, Chief Marketing & Communications Officer at IEX, spoke with Forbes contributor Billee Howard on digital assets, brand purpose, and the future of Web3.