What Is “Trade Surveillance” Software in a CEX?
Trade surveillance software in a Centralized Exchange (CEX) is an automated system designed to monitor, analyze, and flag suspicious trading activity in real-time. This software uses algorithms to detect patterns indicative of market manipulation, such as front-running, spoofing, wash trading, and insider trading.
It monitors order book activity, trade executions, and communication data. Once a pattern is flagged, the system alerts the compliance team for investigation and potential regulatory action.
This is a core component of market integrity and regulatory compliance.
Glossar
Trade Surveillance Software
Detection ⎊ Trade surveillance software, within cryptocurrency, options trading, and financial derivatives, focuses on identifying anomalous trading patterns indicative of market manipulation, fraud, or regulatory breaches.
Crypto Options Settlement
Settlement ⎊ The crypto options settlement process, distinct from traditional finance, involves the finalization of obligations arising from an options contract, encompassing both physical delivery and cash-settlement methodologies.
Trade Surveillance
Detection ⎊ Within cryptocurrency, options, and derivatives trading, detection represents the core function of trade surveillance, moving beyond simple rule-based systems to incorporate machine learning models capable of identifying anomalous trading patterns indicative of market abuse.