I don’t sign up for a lot of email, but I do enjoy getting the Tastytrade email every morning. I saw their CEO Kristy Ross at the 1871 5th Birthday Bash. They just rolled out a new brokerage, Tastyworks, which has the best technology for trading options in my opinion. Here is Tom’s email this morning. It just proves a lot of what I am seeing in Chicago these days and it’s not happening anywhere else like this in Fin Tech.
We finally had some nice weather in Chicago this weekend so I was out and about. Out and about BTW is a two mile radius known to tastytraders as my ‘shuffle zone’. While I’m making the usual stops, I ran into a trader buddy of mine at the cleaners, a stock clerk from the trading floor days at the supermarket and a couple of prop traders at Costco. No big deal, everything seemed normal including the retelling of the obligatory war stories. But then I decided to take a walk through my city neighborhood to get an iced tea. First, I passed by an Argentinian restaurant and sitting outside were two fintech software designers that I knew. We exchanged niceties (whatever that means) but a block further down at a theater coffee shop, I saw two trading firm engineers I knew. We chatted briefly. Finally, I made my way to the Amazon store for an iced tea (I know, something about that doesn’t seem right) and I ran into two platform coders I knew from another country some 5000 miles from Chicago. I said, “Privyet” and they said, “Small world!” Wow – traders at Costco and devs out in broad daylight. Something is about to give!
Back in the day, we had to take a programming class to get a business degree. We used punch cards. At the time, everything was COBOL and they were just rolling out BASIC language. Did you know with all the development that has happened in the ensuing 35 years, banks are still using COBOL? 95% of ATMs use COBOL. COBOL is still a good language but it’s difficult to learn.
Banks and other institutions have resisted the move to the cloud, but that is changing. Finally, regulators are comfortable with many processes becoming cloud based. The cost/opportunity cost equation for banks and other financial institutions skew in favor of moving operations to the cloud rather than maintain them on a private mainframe. Add that to the fact that people who want to create stuff aren’t programming in COBOL.
Tom is right, something is about to give.