MATCHING ALGORITHM, ORDER HANDLING, ORDER TYPE, KEY BENEFITS TO END USERS ETC.
Zipmex uses an order matching system (OMS) to match buy orders, or bids, with sell orders, or asks, to execute trades. Zipmex does this by using computer algorithms. Matching orders happen when compatible buy orders and sell orders for the same asset happen at the same time. Generally, a buy order and a sell order are compatible if the maximum price of the buy order matches or exceeds the minimum price of the sell order. From there, the order-matching systems of Zipmex uses a first-in-first-out (FIFO) system to prioritize orders for matching.
Under a basic FIFO algorithm, or price-time-priority algorithm, the earliest active buy order at the highest price takes priority over any subsequent order at that price, which in turn takes priority over any active buy order at a lower price. For example, if a customer on Zipmex places a buy order for 1.12 BTC at $5,000 per BTC and there is a sell order from a customer on Zipmex for 0.62 BTC at $5,000 per BTC then the 0.62 BTC will be matched first, which is an organic matched order.
Zipmex is a 24/7 exchange because digital assets market is a 24/7 market. It is unethical to not allow users access to the market at all times. The exchange will be scheduling maintenance times on a case by case basis in order to upgrade the exchange platform, evaluate any potential loopholes in the systems and to increase security of the exchange platform as a whole.
- True 24/7 Trading Venue – Resilient, fault-tolerant architecture supports continuous, round-the-clock trading
- Real-Time Trade Settlement – Trade settlement may be implemented to occur near- instantaneously across instruments
- Multi-Currency Trading – Support for rapid, continuous addition of digital currencies, bespoke assets, and national currencies
The AlphaPoint Platform features multiple, full-featured trading APIs spanning key trading functions, providing familiar points of access for different trading styles:
- FIX – Support for secure authentication, order entry, execution reports, market data queries, and market data feed subscriptions
- WebSocket – Support for secure authentication, order entry, execution reports, market data queries, market data feed subscriptions, and deposit and withdrawal
- REST – Support for secure authentication, order entry, execution reports, market data queries, and deposit and withdrawal
The platform supports a variety of trading interfaces:
- Retail UI – Streamlined, user-friendly UI for everyday users to monitor balances and execute market orders
- Trading UI – High-performance, browser-based trading GUI providing single point of entry for key market interactions:
- Order Management
- Trade Reporting
- Quote Management
- Real-Time Balance Updates
- Market Data
Screenshot of Trading UI
- High-performance exchange platform
- Modular, lightweight, extensible design
- Interoperability with of third-party services and DLT products
AlphaPoint System System diagram Matching Engine diagram
Exchange Platform is built on custom-embedded StreamDB database, tied into the wider AlphaPoint Distributed Ledger Platform, and built from the ground up to incorporate error-checking and target multiple volumes for redundancy.
Core system components include:
- Matching Engine – Lean design matches orders at throughputs in excess of 1 million transactions per second.
- OMS – High performance Order Management System (OMS) handles incoming order requests and sends update events about executions and order status changes. Multiple OMSs can be leveraged to scale capacity and throughput for the largest of implementations.
- Asset Manager – Product integration agent, integrating the exchange with diverse banking, FX, and Distributed Ledger Technology systems. Current integrations include 200+ national currencies, 12+ digital assets, including Bitcoin, Ether, Monero, Bitcoin RPC-derived bespoke loyalty tokens, and the AlphaPoint Asset Depository.
- Gateway – Endpoints supporting connections to trading interfaces, APIs, and related user-directed systems. Load balancers maintain throughput performance regardless of user count.
- Risk Management System – Risk is managed via a robust Risk Management System implements a wide range of limits and controls on order entry, execution, and settlement.
- Market Order
A Market Order is a Market Order that occurs when you want to place a buy order or sell digital assets at market prices. For example, you want to buy digital assets immediately regardless of the price. By just selecting a Market Order, your order will instantly match to an order that is offered at the lowest price or the ask price. You must be careful when sending this type of order because if you want to buy a large amount in bulk with Market Order, but each ‘Ask Price’ is a smaller quantity, your purchase price will vary. Your order will be fulfilled with various prices until the amount you want is reached.
Advantage of Market Orders
Using a market order means you can trade immediately without waiting for the exact price like a Limit Order. You will be able to trade fast using the best rate offered at the given time.
The disadvantage of Market Orders
One of the disadvantages of a Market Order is when Slippage occurs. As Investopedia defines,
“Slippage refers to the difference between the expected price of a trade and the price at which the trade is executed. Slippage can occur at any time but is most prevalent during periods of higher volatility when market orders are used. It can also occur when a large order is executed but there isn’t enough volume at the chosen price to maintain the current bid/ask spread”.
For instance, if you buy 1 bitcoin at the current market price of 130,553 THB. If the order book only has 0.2 bitcoin at the current market price of 130,553 THB this amount will be filled and displayed in the Filled Order section. As this is a market order, the remaining 0.8 bitcoin will be filled fully but at a different price level as the first order does not have enough liquidity for you to fill the full 1 bitcoin. So in actual fact, you didn’t buy 1 bitcoin at 130,553 THB , instead the average price you buy will be higher or lower. The same logic applies to sell orders as well.
- Limit Order
Limit order is a limit order that will occur only when you place an order or sell your digital assets at custom prices. Limit orders are generally used to place trades at a price that you are more comfortable with than the current market price. This function can help you determine the minimum value of the digital asset you are willing to sell at or the highest price at which you are ready to buy a digital asset. For example, if Bitcoin is currently at 190,000 baht, but you want to buy when it’s 180,000 baht. Instead of sitting in front of the screen waiting for the price to drop, you can place a limit order to buy Bitcoin so that when the price reaches 180,000 baht, the order can be matched instantly.
Advantage of Limit Orders
A trader can set their ideal price to execute a trade while saving their time of monitoring the market price. If the market reaches that level, a trade will be carried out without the need to monitor the market continually. A positive slippage could occur to a Limit Order. If the current market price falls below the set amount, your position could be opened at a favorable price .Using Limit Order could be a useful risk management method to minimize a loss on a trade. A trader can stop a trade if the market reaches a level that is less favorable than the current market condition.
The disadvantage of Limit Orders
A limit order may never be guaranteed to be filled because the market price did not reach that amount you have specified. You might have an open order for weeks with no match because the market price never reaches your desired price.
Modular system enables flexible implementation of different system components to accommodate a variety of implementations – i.e. Single Operator Exchange, Cross- Exchange Order Book, and High-Volume Book.
Mesh-based, API-driven architecture enables easy integration across a variety of services:
Two Factor Authentication (2FA)
- Google Authenticator
- SMS (Twilio)
Know Your Customer (KYC)
- API connectivity with Krungsri Bank
- Wallet interface for hot and cold wallets