ICE ETF Hub Integrates Chat Functionality

Intercontinental Exchange (ICE) has integrated the ICE ETF Hub with its messaging platform ICE Chat. Peter Borstelmann, head of ICE ETF Hub, says users are already using ICE Chat for the ETF Hub.

“Our most recent release was focused on enhancing the user experience between ICE ETF Hub and ICE Chat,” Borstelmann says. “We allow ETF Hub users to receive real-time updates and feedback on their creation and redemption orders, and custom basket requests.”

Borstelmann says the process of negotiating ETF baskets between market makers and issuers is highly manual, and usually done by email or phone. By integrating chat with the ETF Hub, ICE hopes to automate the process, removing the need for users to convey orders over the phone, and removing problems like human error. API connectivity speeds up the orders and baskets approval process.

The chat functionality is used for back-and-forth communication, but also allows users to populate trade blotters and send quotes. ICE is also planning to launch connectivity for integrated trade execution, and Borstelmann says analytics, pricing, and trading elements can be integrated into the hub over time. Borstelmann says there are many possibilities for interoperability between these two platforms, and ICE is gradually developing these.

The ICE ETF Hub was launched in October 2019, and has been developed as an industry-wide open architecture for ETFs, aiming to make the process of ETF creation and redemption easier for users. Authorized participants on the platform that have connected to the hub so far include Credit Suisse, Wells Fargo, Goldman Sachs, Citadel Securities, Bank of America, and Morgan Stanley. Users can access ETF Hub via the web, FIX API, or ICE Connect Launcher, a desktop app that starts various ICE apps.

Borstelmann says ICE Chat is aimed at giving fixed income players “an alternative to some of the existing chat mechanisms that are available in the space today.”

For fixed income, ICE Chat has features that allow users to see bond prices in real time. It allows authorized participants and market makers to reach out directly to issuers, as well as receive real-time information from issuers.  

Over the coming months, ICE will work on enhancing the negotiation process on the hub so that market makers can communicate using its user interface and APIs. Currently, the hub supports US-listed domestic equity and fixed income ETFs. Borstelmann says ICE hopes to start the development for expansion into the international and European markets in early 2021.

Borstelmann says ICE has also now integrated the hub with ICE FI Select, its fixed income platform. “We have recently established connectivity between ICE ETF Hub and our ICE Fixed Income Select platform.  This integration enables ETF Hub users to send lists of bonds to Fixed Income Select so they procure bonds in the secondary market via the ICE Bonds liquidity pools,” he says. 

He says the exchange will continue to roll out functionality for the hub over the next nine to 18 months.