System and method for centralized clearing of over the counter foreign exchange instruments

US11270379B2 · kind B2 · utility

Assignee

• Chicago Mercantile Exchange Inc. · US

Inventors

• Paul Andrew Bauerschmidt · Chicago, US
• Dmitriy Glinberg · Northbrook, US
• Edward Gogol · Skokie, US
• Stephen M. Goldman · Lake Forest, US
• Paul I. Lichter · Batavia, US
• Jeffrey R. Mitchell · Tallahassee, US
• Ari Studnitzer · Northbrook, US
• Tae S. Yoo · Bartlett, US

Key dates

• Filing date: Jun 22, 2020
• Grant date: Mar 8, 2022
• Expiry date: Nov 3, 2040

Classification

• Technology area (CPC G): Physics
• CPC primary: G06Q40/00
• WIPO field: IT methods for management
• WIPO sector: Electrical engineering

Abstract

The disclosed systems and methods relate to allowing trading of over the counter (“OTC”) foreign exchange (“FX”) contracts on a centralized matching and clearing mechanism, such as that of the Chicago Mercantile Exchange's (“CME”'s) futures exchange system (the “Exchange”). The disclosed systems and methods allow for anonymous transactions, centralized clearing, efficient settlement and the provision of risk management/credit screening mechanisms to lower risk, reduce transaction costs and improve the liquidity in the FX market place. In particular, the disclosed embodiments increase speed of execution facilitating growing demand for algorithmic trading, increased price transparency, lower cost of trading, customer to customer trading, and automated asset allocations, recurring trades as well as clearing and settlement efficiencies.