Proponents of the cloud – where software and hardware is pooled centrally and made available over the internet – say the advent of this technology has parallels with the early use of electrical power. Instead of using their own electricity generating plant, businesses switched to a centralized national grid model – providing power without requiring any maintenance costs. Advocates of the cloud say this is analogous with organizations switching their IT systems outside to the pooled resources of specialist data centers over the cloud.
Gartner, the research analysts, predicts that worldwide cloud services revenue will have increased from $46.4 billion in 2008 to $150.1 billion by 2013. The growth in cloud computing has been bolstered by its capacity to reduce IT costs, as a result of the economies of scale cloud providers obtain. For example, Amazon’s public cloud – Amazon Elastic Compute Cloud (EC2) – can reduce the cost of using a server – which typically costs $10,000 a year to assign inside a bank – to as little as $72 a month, according to financial software specialists.
Global currency markets may seem a world far removed from that of small businesses regularly making international payments. But the dramatic – and beneficial impact – the cloud is having on global currency markets is making it much cheaper for a business to make a cross-border payment. This is because until the advent of the new technology, currency markets were largely dominated by a few powerful big banks.
Unsurprisingly, the Currency Cloud is the perfect example of a company that is benefiting from how this new technology is changing the currency markets. We are not dependent on just a few relationships with a handful of big banks to obtain the best exchange rate for our customers. This is because the advent of the cloud has provided Currency Cloud with a single point of access to a far wider net of currency sources – or “liquidity” to use a high finance term – than was ever possible before the advent of the technology.
Cloud-based trading solutions and service providers are now offering point-to-point connectivity between the providers and users of currency liquidity via global inter-institutional connectivity networks which consist of a wide variety of different players in the Forex markets – including trading platforms and brokers – not just a handful of powerful banks.
The cloud enables Forex market participants to seamlessly connect to a transparent pool of liquidity where customers can pick and choose which source to use. Market makers have benefited from a decrease in the costs of distributing liquidity as a result of such services. Meanwhile, brokers obtain access to liquidity and distribute it to customers benefitting from being able to see a wider picture of the market, being no longer dependent upon just a few relationships with major banks.
The wide variety of Forex venues now connected to the cloud is not just benefiting Forex traders. It is now also helping the thousands of UK small businesses that make international payments every day. This is because the cloud enables Currency Cloud to make timely transactions across a global market that are always at the best price. This means the businesses and consumers that use our service obtain access to a far more competitive exchange rate than that offered by the banks. If you were a Forex trader you would say our spreads are tighter – in layman’s terms we are just much cheaper than the banks. We hope you enjoy the benefits of our service every time you make an international money payment.