XTX Markets opts for Paris European base post-Brexit

XTX Markets will operate its European equities systematic internaliser out of the new Paris office.

London-based market maker XTX Markets has confirmed that is has chosen Paris as its European base once the UK departs the European Union.

The firm said in a statement that it had filed an application with the French regulator, Autorité de Contrôle Prudentiel et de Résolution, to operate a regulated company in the French capital. Although it reiterated that its headquarters will remain in London. 

XTX Markets added that it will operate its European equities systematic internaliser (SI) out of the new Paris branch, depending on regulatory approval, and will operate as a cross-asset investment firm.

Zar Amrolia, co-CEO of XTX Markets said that the market maker is committed to maintaining and further developing its liquidity provision to clients, exchanges and platforms that are based in the European Union.

“As a leading liquidity provider across asset classes globally, it was important to select a location with a strong regulatory environment within which to operate,” Amrolia added. “The French regulators have been very receptive to having a leading market maker such as XTX establish in France and we look forward to working with them to bring even more transparency and efficiency to markets across Europe.’’

 XTX Markets is one of eight market maker systematic internalisers that currently operate in Europe under MiFID II, alongside the likes of Virtu Financial, Citadel Securities and Tower Research Capital Europe.

Research from TABB Group earlier this year showed that market maker – or electronic liquidity provider SI (ELP SI) – executed close to €30 billion in the first quarter of the year, despite hesitance on the buy-side to directly connect to them due to concerns around transparency.

“There is understandably a continued level of cautiousness from the buy-side, brokers and regulators towards this form of execution – and they should remain under close scrutiny in the weeks and months ahead,” the research said.

“However, early evidence suggests that interactions with ELP SIs can offer unique, larger-sized liquidity, with limited market impact. They are a welcome innovation in response to new regulation and emerging technologies, and have a role to play alongside other forms of execution.”