Multiple sources have confirmed that the withdrawal of major banks from Project Amber has shut it down. Three banks had reportedly left before the end of 2022, effectively leaving it without the backing needed to complete its ambitions.
Project Amber was the name given to the programme developed by a consortium of sell-side firms developing a trading platform in the fixed income space. It had been discussed as a potential rival to existing electronic venues including Bloomberg, MarketAxess and Tradeweb, according to sources.
In October, speaking at the Fixed Income Leaders Summit in Nice, Mauricio Sada-Paz, EMEA head of eFICC Sales & global head of eFX Sales, at BAML observed that the concept behind project Amber was positive, but overreaching goals could be problematic.
“There is an oligopoly [in fixed income] unlike FX or equities, there is not a lot of competition, so Amber does facilitate that,” he said. “The risk is that is does too many things, in too many jurisdictions’ in too many products – derivatives and cash. Historically if you look at the consortia that have succeeded, they have been one-trick ponies, trying to do everything at once, but also the bigger the group of bank the harder it is to make decisions.”
Although banks have had some success in collaborating in bond markets over the past decade, those projects are ongoing and themselves offer routes into developing trading capabilities.
Neptune, originally ‘Project Neptune’ when it launched in 2015, is a bank-backed service that delivers standardised streaming axes from dealers to clients, making it easier for the buy side to trade against dealer positions. It announced at the end of 2022 that it may develop trading services on its platform.
DirectBooks is offering a dealer led platform for new bond issuance which has had great success in the US market.
Symphony is delivering a communications network that could rival Bloomberg chat, allowing firms to have control over their own communication records.
Oliver Jerome, founder of transaction cost analysis (TCA) provider BestX, had historically been associated with Project Amber, but more recently had celebrated the seven-year anniversary of BestX, which was bought by banking giant State Street in 2018.
Market sources have cited that a combination of overly ambitious goals, and existing consortia with a similar make-up of banking firms and goals made Project Amber too hard to continue to support. With an expectation that years would be needed to get a trading venue off the ground, ground banks were reportedly not prepared to maintain the necessary investment.
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