Nasdaq has announced that it will move its markets to Amazon’s cloud, as part of a $600 million project worth more than half of the company’s market cap. Nasdaq is planning on moving 89 percent of trading volume and all public data over in 2019. If you aren’t an expert at technology yet, then this might not be something for you to get excited about; however those who are tech-savvy can see how big this could become especially with blockchain revolutionizing many industries including finance.
The “aws stock exchange” is a move by Nasdaq to move their markets to Amazon’s cloud. The move will allow them to reduce the costs associated with running their marketplaces and increase security.
Nasdaq Inc. said that it would begin migrating its North American markets to Amazon.com Inc.’s Amazon Web Services cloud-computing platform next year.
The plan, which will be phased in and begin with Nasdaq MRX, a U.S. options market, entails the exchange operator handing over huge quantities of data to a third-party cloud provider. Nasdaq did not provide a schedule for the other markets to be moved.
Nasdaq’s goal is to become “100% cloud-enabled,” according to Adena Friedman, the company’s CEO, who announced the change Tuesday at an AWS industry conference in Las Vegas. “As we engage closely with clients, we will follow up with more of our markets,” Ms. Friedman said.
Nasdaq has previously said that during the next decade, all of its more than 25 markets would be housed on the cloud.
Adena Friedman, CEO of Nasdaq.
courtesy of Bloomberg News/Simon Dawson
They include six North American stock markets, including the Nasdaq Stock Market, six equity derivative markets, the Nasdaq Baltic and Nasdaq Nordic markets, as well as fixed-income and commodities markets.
The financial services industry has been slower to embrace cloud computing than other sectors, owing in part to banks’ and exchanges’ strict regulatory control, as well as worries about sensitive customer data breaches.
“To the degree that they don’t disintermediate their trading partners and investors,” said Larry Tabb, director of market-structure research at Bloomberg Intelligence, “going to the cloud provides exchanges more flexibility, as well as enabling more people to join, enables people to connect easily.”
CME Group Inc. and Alphabet Inc.’s Google agreed earlier this month to shift CME’s primary trading systems to the cloud.
Nasdaq already has billions of transaction records stored in an Amazon Web Services data warehouse, including daily orders and quotations sent by traders. Several services, notably the company’s revenue management system for the US and European regions, have been transferred to AWS throughout the years. Nasdaq said it picked the Amazon.com subsidiary to host its markets because of its existing connection with AWS.
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Nasdaq’s chief technology and information officer, Brad Peterson, stated, “We’ve had a longtime relationship with them.”
Third-party providers, such as Amazon.com, Microsoft Corp., and Alphabet Inc.’s Google, run data centers where cloud systems and applications are housed. The solutions make it significantly easier for customers to expand processing demands depending on demand than they could in their own data centers.
Mr. Peterson credits cloud systems with preventing Nasdaq from stopping trading in January, when a rush for shares of GameStop Corp. and a few other businesses overloaded major online brokerages, causing a rise in market volatility and forcing several operators to limit trading access.
Moving markets to the cloud, he added, has the potential to provide the exchange improved security, stability, and scalability, or the ability to swiftly increase computer capabilities. Mr. Peterson believes Nasdaq and AWS may collaborate to develop new cloud-based goods and services for Nasdaq’s clients.
Nasdaq’s increased usage of cloud technologies, according to Scott Mullins, director of world-wide financial services business development at AWS, is driven by a requirement for flexibility and robustness to manage market volatility and hundreds of billions of trade events per day. Mr. Mullins said, “If you’re doing it on bespoke hardware, you’ll have to estimate what your capacity needs to be.”
Since early 2012, the two businesses have been collaborating to expand Nasdaq’s cloud-based capabilities, according to Mr. Mullins. Mr. Mullins said, “If you receive a bill from Nasdaq today, it’s coming from a data lake sitting on AWS.”
“We’ll only do it at a speed that’s right for us, AWS, and our customers,” said Tal Cohen, Nasdaq’s senior vice president and head of North American markets.
The move, according to Ms. Friedman, is focused on the exchanges’ matching engines, which connect buyers and sellers and handle a large number of price quotes and trades, many of which are submitted by high-speed trading firms used to having the exchange’s systems process orders in millionths of a second.
Nasdaq’s principal data center for its U.S. stocks and options markets in Carteret, N.J., will be extended in the first phase of the transfer, according to Mr. Peterson, and AWS will deploy computer capacity there. Traders would be able to link their servers to AWS servers in the same manner they do now with Nasdaq, he added.
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Nasdaq is moving its markets to Amazon’s cloud. The new Nasdaq will be a private, managed service that uses the AWS platform. nyse aws
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