LoopFX Goes Live
Posted by Colin Lambert. Last updated: August 1, 2025
LoopFX has marked an important milestone by going live as an FX trading venue, matching trades within State Street’s FX Connect platform.
LoopFX is a dark, mid-market matching mechanism that operates on a “P2P2B” basis, whereby client trades are matched with peers if a match is available, but also with bank interest – the latter being able to stream axes above the network’s minimum threshold.
“We have fully executed agreements across 15 asset managers and banks, with many set to match on Loop shortly,” says Blair Hawthorne, CEO and founder of LoopFX. “We’re especially grateful to State Street’s FX Connect; their support and collaboration have been instrumental in enabling a smooth and timely rollout, we couldn’t have done this without them. With strong early adoption and growing momentum, we are well-positioned to accelerate our growth in the institutional FX market.”
Greg Fortuna, Head of GlobalLink at State Street, adds, “Integrating LoopFX into our FX Connect platform enhances our clients’ ability to access mid-market liquidity efficiently and securely. This collaboration supports our broader goal of delivering seamless execution workflows that help clients manage large FX trades with greater precision and reduced market impact.”
Loop was created to solve the problem of information leakage associated with larger orders, and has Schroders, Royal London Asset Management, State Street Investment Management and RBC Capital Markets among its early participants. Gordon Noonan, head of FX trading at Schroders, observes, “It’s great to see both banks and asset managers engaging early with a solution like LoopFX. Collaboration across the industry is key to building a healthier, more efficient market structure. The ability to match offsetting interest at mid, with minimal market impact, is valuable – and having that workflow embedded within FX Connect makes it easy to access.”
Mark Jenkins, senior fixed income and derivatives trader, Royal London Asset Management, adds, “LoopFX is a sensible step forward. It gives us another way to access liquidity without broadcasting our intent, and having it sit inside FX Connect keeps things simple. It’s good to see the market coming together – banks, platforms, asset managers – to build tools that work for practitioners.”
Highlighting the execution benefits from the new venue, Jamie Smith, senior FX dealer, State Street Investment Management, says, “LoopFX provides an additional execution path for large FX trades, helping to minimise signalling risk while maintaining workflow continuity within FX Connect. The ability to match offsetting interest at mid-rate is a valuable enhancement to our trading toolkit.”
The Full FX View
Perhaps the most important element of this release is the plural in “trades” – it is easy for a new venue that has worked its way through the long and laborious (and not always successful) process of going live to celebrate the first trade – only to wait a long time for the next.
Dark and peer-to-peer mechanisms and FX have a tricky history. On one hand there is a line of venues that have tried, with varying degrees of success (none of them overly successful to date), getting peer-to-peer mechanisms into the mainstream; and on the other there is what seems to be a successful model in BGC’s MidFX. The latter is, of course, a bank-to-bank venue – an important distinction – so Loop’s first task is to create a truly collaborative environment that embraces the banks.
This is something it has achieved if early feedback is anything to go by, and the importance of this cannot be understated. I have argued for many years that if a natural peer-to-peer environment could work in FX markets, there would be much less market impact at the Fix as a first signal; and as a second, buy side firms would be willing to both stream interest and wait patiently for a match. Neither condition has existed.
Banks too need to be open to this concept, for this is not just another venue seeking to charge them as much brokerage as they think they can get away with, not only does it actually pay the banks for matched liquidity, it is offering a chance to exit significant risk, also in a dark environment. Yes, there will be costs associated, but the banks all internalise as much as they can (some significantly less than they claim), but trading the exhaust can still be costly.
So just as its integration into FX Connect to start with means that the buy side workflow is barely disrupted (if at all), LoopFX can also offer banks an additional string to their internalisation and risk management bows.
The good news for Loop is that early conversations I have had have been positive, with some bank teams looking forward to connecting and going live, and other buy-side firms expressing an interest. The potential challenge is making sure that the mechanism remains true to its origins – some of the buy side firms I have been talking to like the idea, but would not – in my view at least – help the trading environment if they were connected. Ultimately, this has to be, as far as it can be, a venue for firms that want to hedge and manage risk, not necessarily (and I understand there will always be an element of this) make money out of their FX trading.
Ultimately, however, there should be positivity, because in my mind the FX market has been crying out for such a venue for a long time, probably starting with Lava FX, whose plans were thwarted to a degree by a change of ownership. Fragmentation and a dramatic reduction in average ticket sizes has made it harder for both banks and buy side to exit larger risk – something they both have in common – a mechanism like this potentially makes it easier.
Whether it does or not, only time will tell, but for now we are in a slightly curious position of having another FX platform, in this case network is probably a better term, go live, thus increasing fragmentation, while at the same time trying to solve for one of the problems of fragmentation. Above anything else, this makes LoopFX an interesting development, and one that offers a good value proposition for both sides. Progress will not be in a straight line, it never is, but the early signs are good, as they should be.
