Virtual Trading Floor Avatars for Remote Open-Outcry Trading
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Solution Overview
Problem
The COVID-19 pandemic highlighted the limitations of physical trading floors in maintaining market liquidity and safety for open-outcry trading, as they are prone to disruptions and pose challenges in information distribution among market participants.
Innovation Solution
A Virtual Trading Floor (VTF) system implemented via an exchange computer system enables remote market participants to engage in open-outcry trading practices in a virtual environment, using 2D or 3D graphical representations of traders and real-time interactions, with secure data transmission and order matching.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Object-affected harmful factors
If physical trading floors are shut down to ensure public health safety, then health risks are reduced, but market liquidity and information distribution are severely degraded
Solution Approach 1:
The patent creates a virtual copy of the physical trading floor environment, replicating the open-outcry trading atmosphere, visual cues, and interpersonal interactions through digital avatars and virtual spaces. This copying allows traders to experience the benefits of physical presence (information flow, market sentiment) without the health risks, as the virtual environment can be accessed remotely while maintaining market functionality
Solution Approach 2:
The patent replaces the mechanical/physical system of traders gathering in physical spaces with an electronic/digital system using avatars, virtual environments, and computer networks. This substitution eliminates the need for physical presence while preserving the essential trading functions, allowing market participants to interact through digital representations rather than physical bodies
2Ease of operation
If all open-outcry trading is performed on physical trading floors, then face-to-face interaction is maximized, but safety and fairness are compromised due to crowd noise and physical altercations
Solution Approach 1:
The patent introduces virtual avatars as intermediaries between traders, allowing face-to-face interaction to occur through digital representations rather than direct physical contact. The avatar system mediates communication and interaction, preserving the social and informational benefits of personal interaction while eliminating exposure to physical hazards such as crowd noise, altercations, and health risks
3Loss of information
If physical trading floors are used, then real-time visual and auditory information is naturally distributed, but the environment becomes chaotic and information access is uneven
Solution Approach 1:
The patent implements local quality by allowing each trader to customize their virtual environment and information display according to their specific needs and preferences. Different traders can focus on different visual and auditory cues, adjust their virtual positions to optimize information access, and receive personalized feedback streams. This creates equitable information access where each participant can optimize their information gathering without being constrained by the chaotic physical environment
Data Source
AI summary
A method for virtual floor trading implemented via an exchange system includes establishing a secure connection with a first market participant and transmitting, to a computing device associated with a first market participant, data causing a graphical user interface (GUI) of the computing device to render a graphical representation of a virtual trading floor associated with the exchange system. The method also includes receiving a first order and transmitting, to a second computing device associated with a second market participant, data causing a GUI of the second computing device to render a second graphical representation of the virtual trading floor comprising a first virtual trader associated with the first market participant. The method includes receiving, from the second computing device, a second order, determining that the second order matches the first order, and executing a transaction based on the first order and the second order.