Skip to main content

Market Structure

The market-structure case for Ollo starts with scale and structural friction in FX, not with tokenization for its own sake.

Core Thesis​

Ollo's research starts from three linked observations:

  1. FX is one of the world's largest markets, but access and settlement still remain relationship-heavy and operationally fragmented.
  2. Stablecoins create a new settlement substrate while also introducing basis risk across issuers and rails.
  3. Onchain infrastructure can improve execution legibility, settlement coordination, and risk transfer before it replaces every legacy market layer.

FX Scale​

Current Ollo research cites roughly $9.6 trillion in daily OTC FX turnover. Even at that scale, access remains relationship-heavy and operationally fragmented.

Where Friction Comes From​

Key frictions include:

  • Bilateral credit gating
  • Prefunded capital
  • Opaque execution practices
  • Fragmented post-trade settlement

Published source material makes the prefunding problem concrete. SWIFT reported that 34% of the cost of an international payment is related to Nostro trapped liquidity, while Circle's StableFX Litepaper cites estimates that roughly $27 trillion sits idle in nostro/vostro accounts globally to support prefunding of FX transactions. For a worked-through version of how those costs can flow into spreads and financing terms, see Concepts: Why Onchain FX.

Stablecoins Change The Context​

Stablecoins provide a new settlement substrate, but they also create issuer-by-issuer basis risk. That makes stablecoin fragmentation part of the FX problem, not a separate topic.

Which Layers Onchain Can Improve First​

The strongest case in current Ollo research is for improving:

  • Settlement coordination
  • Execution legibility
  • Risk transfer

It is less realistic to assume that protocol design alone will immediately replace credit relationships, licenses, or every distribution layer in legacy FX.