Earlier this year we attended the TradeTechFX conference in Miami, where three key industry themes dominated discussions, presentations and panels.
Firstly, more than ever, buy- and sell-side firms of all sizes need to make sense of large amounts of data, capturing and analysing it in all parts of the trade lifecycle. On the buy-side, traders are paying a great deal of attention to performance metrics and data quality, especially when assessing when to deploy FX algorithms. Banks are analysing data from multiple sources to optimise pricing accuracy, with many using pricing engines like D3 Pricing to quickly construct forward curves using data from different sources.
Secondly, against a backdrop of increased costs and reduced spreads, the drive for efficiency and a focus on speed of analysis and execution is driving the adoption of workflow automation. In the past, growing volumes led to more people being added to certain functions, but with margins now so slim only technology can provide a cost-efficient solution. Those firms which continue to rely on manual processes risk being left behind by competitors which adopt automation.
And thirdly, the FX Swaps and FX Options markets are expected to continue to grow, driven by the adoption of electronic trading. At TradetechFX we noted that there was a great deal of interest in interbank venues for both FX Swaps and Options – as these CLOB venues evolve and capture volume the resulting core market data is expected to further enhance pricing accuracy for all parties.
The automation of FX Swaps
The FX Swaps market is probably 15 years behind Spot in terms of automation but is catching up quickly. Like Spot, further automation is needed to capture and analyse data, optimise pricing and increase workflow efficiencies.
As electronic trading in FX Swaps grows, banks of all sizes are upgrading pricing software to ensure market data is captured and analysed, and accurate client pricing is generated, while enhancing workflow efficiency.
Mid-size and smaller trading desks have relied on Excel for many years, but Excel is not up to the task of analysing huge amounts of data from available sources and delivering accurate client pricing. The pricing of FX Swaps is extremely complex, requiring precise pricing along the whole forward curve – not just for standard dates, but for approximately 250 cock dates as well.
The growth of electronic trading has increased the velocity of FX Swap markets, meaning that any incorrect pricing will quickly result in trading losses.
Automating trader workflows
As electronic trading continues to grow and banks push for efficiencies, Traders at Tier 2 and Tier 3 banks face new challenges. Not only are traders required to ensure pricing accuracy and visibility at all times, but in many cases they are also required to price a growing number of clients themselves.
In a situation where trading desks directly manage client pricing, manually adjusting pricing simply isn’t a sustainable solution. Instead, traders are now deploying technology solutions to establish easily maintainable, rule-based and scenario-based logic to automate pricing decisions.
In response to traders and eFX businesses needing these workflow automation services, DIGITEC recently launched D3 Channels. The service simplifies the management of pricing adjustments and ensures that the platform automatically determines the exact price to be sent to clients, based on tier, volume band, and market conditions.
By providing greater control and visibility, D3 Channels enables trading desks to scale their operations, moving higher volumes to electronic trading channels. It enables traders to focus on executing active strategies rather than responding to individual requests, freeing up resources and alleviating workflow pressure on trading desks.
Looking forward
The combination of client demand for FX Swaps, advances in pricing technology, and more available data, drove up volumes in 2025, and we expect this growth to continue during 2026. Clients are looking to trade FX Swaps in more currencies and tenors, and banks can only support these client demands by implementing technology solutions. Without investing in technology these banks risk being replaced by their competitors.
At the end of 2025 and the start of this year we have seen firms start to migrate from using voice brokers to interdealer venues like 360T SUN and LSEG Forwards Matching. This is partly due to our solution, D3 OMS, which enables FX Swaps traders to efficiently place and actively manage orders on interdealer venues. We expect this migration to continue and for interdealer volumes to increase as a result, driven in part by our pipeline of onboarding banks.
Data management and analysis will continue to be key topics throughout 2026, particularly the availability of more data from many different sources. As an example, some banks are using our D3 Pricing service to build their curves using data sources including FX Swaps and Forwards, FX Spot, STIR Futures, OIS, IRS and Cross-Currency Basis Swaps.
As new data sources from different markets become available the more technologically advanced firms are subscribing to this data to give them an information and speed advantage in FX trading.
Editor’s note. We are picking up the electronic FX swaps trading topic again in next months edition.