As we close the book on 2025, the temptation to look back may seem overwhelming; it was certainly a year in markets that will not be forgotten quickly. But for those of us working to shape the future of institutional trading, the challenge as ever is to try to look ahead. If this year has taught us anything, it’s that resilience and innovation are not just buzzwords; they are the bedrock of enduring success in markets defined by sudden volatility, fragmentation, and relentless technological change.
Mark Govoni
A year of volatility – and endurance
2025 was a year that tested the infrastructure and ingenuity of the entire trading ecosystem. Beginning in March and then peaking in April, we witnessed periods of exceptional volatility and volume, yet the market’s core infrastructure proved battle-worthy, ensuring fair and orderly trading even in the most turbulent moments. That is testament to the maturity and sophistication of our industry and the resilience of the today’s technology to process trading and information of such scale.
Liquidity in flux: Lessons from the front lines
A recent interview in the Trade with Liquidnet’s own Prashanth Manoharan, illuminated the shifting sands of market liquidity. Since early 2025, we’ve seen a notable decline in touch sizes and widening spreads, signalling heightened risk management sensitivity and a migration toward immediacy. While smaller touch sizes don’t necessarily mean lower volumes, they do reflect a market where certainty of execution is prized, and trading costs are on the rise.
Institutions are responding with more sophisticated execution strategies – slicing parent orders, leveraging queue priority, and diversifying liquidity access across lit, dark, and bilateral venues. Notably, bilateral liquidity has surged to represent a significant contribution to volumes, with direct connectivity to market makers and broker-built access layers helping to reduce costs and improve execution quality. As periodic auctions and bilateral channels continue to grow, the need for adaptive algorithms and smarter routing has never been greater.
Innovation across asset classes
The evolution of market maker liquidity – across rates, equities, and credit – demanded new approaches, prompting us to launch sub-block liquidity solutions that better match the needs of today’s institutional traders.
This year also marked a significant milestone in our multi-asset journey. The launch of Liquidnet’s US equity options business, with dedicated high-touch and low-touch teams, is a testament to our commitment to delivering value across asset classes. The sustained growth in options trading presents real opportunities for innovation. By centralising access to liquidity and leveraging technology-driven solutions, we’re building offerings that complement our strengths in equities, fixed income, and listed derivatives.
Our expansion into bilateral liquidity for European buy-side traders – partnering with leading market makers like XTX Markets – addresses growing concerns around fragmentation and opacity. By integrating bilateral liquidity into our front-end and algo suite, we’re providing Members with the tools to access meaningful liquidity with confidence and control, while supporting the market-making community in extending their reach.
Finally, next year will see the fruit of TP ICAP, our parent company’s acquisition of Neptune Networks, an independent financial data company co-owned by a consortium of some of the world’s leading investment banks. Neptune delivers high-quality, real-time pre-trade bond market data from many sell-side banks to buy-side clients which we will bring together with Liquidnet’s electronic credit trading platform to create a unique, full service, global dealer-to-client credit business.
It’s a market long overdue true innovation and by combining Liquidnet’s extensive client reach with leading liquidity providers, we will seamlessly and discreetly connect the sell-side and buy-side, unlocking the market’s full potential and driving a step-change in fixed income liquidity.
The enduring power of community
As Liquidnet celebrates its 25th anniversary in 2026, I’m reminded that our greatest asset is not a single product or platform, but the global community of buy-side Members who partner with us in innovation. Through initiatives like Liquidnet Labs, Headway, and Gateway, we invest in both technology and people – ensuring that when markets evolve, our Members are prepared not just to adapt, but to lead.
And nowhere looks riper for game-changing innovation next year than AI. The hype is certainly real and those who can harness AI’s ability find insight amongst vast, disparate data sets will prosper. In that spirit, First Mate our new AI Sales Trading Assistant, developed in partnership with Amazon Web Services and set be rolled out next year, will empower coverage teams to send relevant information, targeted to the right clients, at the right time to drive additional order flow, retention of orders, and improved client trading performance.
Looking ahead to 2026, the challenges are as real as ever: the enduring search liquidity under varying regimes, the promise of AI, and ever-shifting regulatory landscapes. But with a community that builds together, I’m confident that the most important innovations are still ahead of us.