Citi has made a strategic minority investment in Cicada Technologies Inc.
The investment was made by Citi’s Markets’ Strategic Investments unit, which is responsible for sourcing and executing strategic investments related to the Citi’s Markets franchise. Citi will also act as a liquidity provider for the trading platform.
Cicada is a fintech based in Greenwich, CT that also has a presence in Mexico. Citi joins existing investors Kaszek Ventures, Dila Capital and BCP Securities.
Cicada has created an innovative all-to-all electronic alternative trading system (ATS) that helps global institutional buy-side and sell-side market participants trade Mexican government fixed income securities without the need for a pre-existing trading relationship. ATS is registered with the SEC and the broker-dealer activities of Cicada Securities LLC (a subsidiary of Cicada technology Inc.) are regulated by FINRA.
Cicada enables electronic trading of 28 Mexican government bonds, including: nominal fixed rate notes (Mbonos) and inflation-linked notes (UDIBonos) that can be settled on Indeval, Euroclear or Clearstream. The company also seeks to allow trading of Cetes (Mexican bonds), TIIEs (Mexican interest rate swaps), Mexican corporate bonds and other emerging market government securities.
Jose Luis Yepez, Head of Local Markets Rates Trading at Citi, said:
“As a leading liquidity provider in the Mexican government bond market, our participation in Cicada’s platform reflects our ambition to be at the forefront of electronic trading.”
Cicada aims to accelerate e-trading adoption through a Central Limit Order Book (CLOB) and Request for Quotes (RFQ) protocol. The platform also offers automation tools for market and liquidity providers, efficient trade execution, connectivity to post-trade services and data analysis of live and historical bond prices.
Ignacio Tovar, co-founder of Cicada said:
“Merchants are embracing the technology quickly and currently 15 well-known institutions are active on the platform and 10 are in the process of joining. Since its launch last year, the volume of transactions on the platform has increased 15 times.”
“We are excited to invest in Cicada. The trading platform technology together with Citi’s partnership has the potential to enhance the efficiency of the multi-billion dollar Mexican fixed income market,” said Aldo Alvarez, Lead LatAm in Citi’s Strategic Investments unit.
Through investments in startups and early-stage companies, MSI promotes the development and adoption of new technologies, market structure and solutions to drive innovation.