How Does an RFQ Platform Differ from a Central Limit Order Book (CLOB)?
A CLOB is an anonymous, continuous matching system where bids and offers are displayed publicly and executed automatically based on price-time priority. An RFQ platform, however, is a bilateral or multi-lateral negotiation system where a trader requests specific quotes from selected counterparties.
RFQ is typically used for larger, less standardized, or block trades, offering better price discovery and less market impact than trying to fill a massive order on a CLOB. CLOBs offer transparency; RFQ offers discretion.
Glossar
CLOB
Execution ⎊ Central Limit Order Books (CLOBs) represent the foundational infrastructure for price discovery and trade execution within cryptocurrency exchanges and regulated derivatives markets, functioning as a digitized order book mirroring traditional financial systems.
Continuous Matching System
Architecture ⎊ A Continuous Matching System (CMS) within cryptocurrency derivatives, options, and financial derivatives represents a distinct order execution methodology, diverging from traditional batch-based approaches.
Central Limit Order Book
Aggregation ⎊ This mechanism collects all outstanding buy and sell orders into a single transparent ledger.
Rfq Platform
Definition ⎊ Rfq Platform is the dedicated trading technology used by institutional participants to solicit firm, private pricing quotes from multiple liquidity providers simultaneously for large or complex derivative trades.