Annanay Kapila – Perpetual Futures Everywhere and All the Time (S7E24)
Episode publishedPodcast: Flirting with ModelsFlirting with Models
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Alright. Three, two, one. Let's jam. Hello, and welcome, everyone. I'm Corey Hofstein, and this is flirting with models, the podcast that pulls back the curtain to discover the human factor behind the quantitative strategy.
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In this episode, I speak with Anane Kapila, founder and CEO of QFX, a twenty four seven centralized perpetual futures exchange for traditional financial markets. Before founding QFX, Anane worked at Flow Traders and Tower Research, where he was introduced to high frequency trading and market microstructure in both crypto and traditional markets. Insights gleaned during these experiences led him to the conclusion that the perpetual futures model applied to traditional so called real world asset markets like equities was an inevitable future and one he wanted to build. In this episode, we discus
Thanks for having me. I think you summarized it perfectly. I think it's a very exciting time to be in financial markets. Probably the most exciting time since the dawn of like API trading on life, which is a few minutes walk from me here in London. I believe it or not, it the first exchange to do API trading. And yeah, looking forward to cracking the nut open on this one with you.
Now before you started your entrepreneurial journey, you were working at Flow Traders and Tower Research, which are two firms that are really sort of always competing at the edge of modern market microstructure. I'm curious what you saw there, especially around how exchanges operate, how the world of market microstructure works that ultimately led you to this insight that sort of a crypto style centralised exchange for, I don't want say traditional futures, but perpetual futures in traditional markets might actually be the future of futures architecture.
Working as an HFT quant, right, you really have like a unique view, maybe even better than the exchange into how an exchange actually works. Because your entire job is to get orders from your system through the exchange and back as cleanly and as fast as possible and as reliably as possible. Because sometimes you're doing, like, half the exchange's entire volume by yourself. So I started Flow. I was doing crypto then. I moved to Tower where, you know, I was doing much more technical things, especially on the crypto side. And then the Gensler era happened, SEC happened, Biden happened, and ther
So if I take you at your word that for markets without physical delivery, the PERP maybe is a superior product design. Why don't you have exchanges like CME or ICE who are the incumbents
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