How to Assemble a Crack Team for Your Exchange
Have you ever seen a heist movie where one person plays every role? They walk into situation after situation, changing hat after hat, fake mustache after fake mustache. No. Nobody has. Because that movie would be dumb. No, there is always that sequence of scenes that reel through with backstories of one character or another before a title slides onto the screen with some funky name like “Spyke,” “Boxer,” or “Killer Queen,” then AKA “The Driver,” “The Spy,” “The Thief” until the whole team is introduced. While you might not want a driver, spy, or thief running your exchange, you’ll still get nowhere without the right people with the right skills.
At Devexperts, we provide the tools, the tech, and the software/hardware. But history—and even the worst heist movie—knows that a great idea falls to pieces without a team to hold it together. After launching multiple options and crypto exchanges, we know all the necessary players for each department needed to pull off the day-to-day functionality.
So let’s break it down. The names might not be as cool as those in heist movies, but with the right team, you’ll make a lot more money than they do anyway.
“Biz Dev,” AKA Business Development Team
This is where the right ideas become the right products that find the right buyers. Their job is to find strategic opportunities, cultivate partnerships, and identify new market potential. This department will vary in size but should always have two key roles filled:
First, “The Planner,” AKA Product Manager (AKA Product Owner, Business Development Manager, or Requirements Manager, depending on the company). This person (or people) determines what instruments get traded, who trades them, and which partners get connected.
The right product manager will:
- develop a methodology to determine traded contract risks for an exchange or companies sponsoring/holding the accounts of market participants (traders): clearing, custodians, etc.
- protect customers from negative balances or margin calls.
- deal with B2B partnerships with market makers, brokers, liquidity providers, technical vendors, and market data distributors.
With so much on their plate, this role can be split between a team covering enterprise sales, partner sales, and a sales engineer.
And then, “The Product Guru,” AKA Marketing Director. This person comes up with the product and strategy to bring more third-party collaborators and higher trade volumes to their exchange. They are there to lead the implementation of marketing campaigns run within the Business Development team.
Depending on the scope of your marketing efforts, the Marketing Director may require a team that includes marketing strategists or analysts, brand managers, digital marketing managers, content experts, SEO specialists, and more.
“Ops” AKA Operations Department
This team is in charge of making sure everything goes smoothly. They operate the exchange and ensure daily processes are getting done—no fake mustache, no hat—all brain. And it can’t function without “The Brains of the Operation,” AKA The Operations Manager.
One of the Operations Manager’s primary goals is to onboard clients and firms, which in this context would include brokers, market makers, trading firms, and even retail traders.
A solid operations manager will:
- take care of the firms’ and clients’ needs, for example, getting access to trade on the market via trading interface or API.
- oversee and sign contracts and agreements with firms that provide the exchange with connections, data feeds, personnel, etc.
- monitor the system to make sure everything is up to snuff and do manual operations, corrections, and interventions as needed.
- take measures to control risks set by the risk management team when needed.
The other essential role in operations is “The Back-Up,” AKA Back Office. They are usually responsible for the end-of-day operations, for example, publishing/sending settlement prices if the market implies that the instruments should be settled. They add either new packs of instruments or new securities. This process is associated with the instruments traded on this exchange.
“The Securities,” AKA Compliance Department
This department, sometimes an individual, keeps an eye out for any abnormal activity, like money laundering, market collusion between big players, and everything that should be prohibited. Sometimes, this role also includes compliance.
On centralized, regulated exchanges, this department is crucial. This complex monitoring system keeps track of all applications and triggers alerts. The team receives the signals and handles them.
In a broad sense, compliance ensures that the exchange complies with the requirements of regulators. The people on the team monitor compliance and investigate non-compliance of payments, and suspicious transfers, get alerted in case of insider trading, information sharing, etc. All departments can send reports to the regulator, all firms, and participants on their completed transactions and to clearing firms.
A good compliance officer will:
- make sure the company complies with all regulatory and legal requirements
- investigate non-compliance of payments, suspicious transfers, insider trading, information sharing, etc.
- work well with other departments to manage regulatory risk
- institute disciplinary measures for any regulatory breaches within the company
The right compliance team is essential since it is an increasingly complex aspect of financial markets with new regulations, stricter enforcement, and enhanced data analytics applied to market participants.
Going forward without a compliance team would be like not having anyone to check the alarm system before a heist.
“The Suits” AKA The Legal Department
While a legal team led by the Chief Legal Officer might look out of place in a heist film, they are a must for any prospective exchange. Whether you’re operating in a national market or are going global, you’ll need to consider several legal factors; licensing requirements, laws and regulations, jurisdictional enforcement actions, etc. A legal team is essential for determining how to structure the company, minimize liability, and chart the best path for growth.
“The Rules Team,” AKA Risk Management Team
They define and set the settings for each instrument. (For example, at DXmatch we provide Fat Finger Protection, Price Slippage Limit, Kill Switch, Message Throttling, and more.) This team is led by the Risk manager or Chief Risk Officer. They hold the “Rule Book” of an exchange which tracks the behavior of the exchange, trading schedules, and order types.
The right person for the job will understand how to:
- Enforce regulator’s rules. For instance, how long exchange logs and data are kept, equal market access to all participants, KYC process, and having an anti-money laundry (surveillance) system in place
- Ensure market integrity; the market works as expected.
- Report to regulators on any rule book changes.
- Make sure an exchange has sufficient risk controls. To protect the exchange from faults and participants from losses.
This team protects customers from risk by creating instrument and order book related controls to help market participants avoid entering an order by mistake and losing money. Or—for exchanges providing access for all retail customers—they control position exposures and do margin calculations to avoid negative buying power.
They are responsible for defining both risks to the business and to the end client, margin calls, liquidations, setting up the appropriate control procedures, cyber security, custody, and business and reputational risks.
“The Team in the Van,” AKA IT Department
The movie star never plays the van-techie, but they’d get nowhere without them. IT personnel make up network and hardware engineers and security specialists. They’re responsible for defining the technical architecture of the exchange and its security protocols, as well as setting them up and maintaining them. It’s up to them to decide how the connection will be provided, whether data will be stored on the cloud or on hardware, maintaining the historical database – all this should be provided as resources.
In addition, we have some second and third-layer support teams responsible for the smooth running of the trading engine itself. These tasks involve monitoring, resource allocation, checking logs, setting up new servers, installing software, etc. This secondary support is also a service that Devexperts can provide if required.
This department should include the following:
- business analysts to assess and improve processes and systems
- technical architects to design the structure of any technical software/hardware solution
- development team to write code and handle any technical needs
- quality assurance specialists to evaluate products and propose corrections or improvements
- development operations to oversee product developments and ensure efficiency
- technical support to resolve any software/hardware-related issues
- system engineers to set up the environment, hardware, network, security, and operating system.
Depending on the company, some roles might overlap, or, for example, two people can be responsible for all operations.
And we can’t forget the Admins, AKA “General Administration.”
These folks are in charge of all internal coordination for an exchange. They keep the wheels turning and manage publicity. They are in charge of working closely with members of each team to better organize the structure and flow within the company. This department tends to get overlooked for the flashier teams, but they are the glue that holds any business together. The best candidates would be those who are detail-oriented, smooth communicators, and diligent workers.
In every team, fellowship, squad, gang, crew—every story that calls for an ensemble cast—when every role is filled with the right people, success is inevitable. Sometimes a team comes packaged, but more often than not, it starts with a few members that build. Finding success with creating an exchange is no different.
You can start your exchange journey with even two people. Our line-up is merely a guide on what the people on your team will need to handle daily. You can even use it as a stepping stone on which to build up your company and hire new people! Duties might overlap, and position names can change, but everything will be okay if your employees are reliable.
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