Documentation
Settlement Notification
An introduction to Settlement Notification.
Trade Counterparties Can Be Notified by Email
This system can be used in different ways, either by a single User or a group of peer Users.
In the single User model, an external website or application routes Orders from the Buy and Sell sides to the Market, and pulls Fills for settlement. This might be used by a corporate website, selling products, with Orders from customers on the Buy side, and Orders from employees on the Sell side, and then settling using their existing fulfilment process at the negotiated prices.
In the multiple-User model, an association of traders all trade as peers on the same Market. In this scenario, when a trade occurs, an Owner of the Market can send email alerts to the trading counterparties. The two traders can then transfer goods and currency as they see fit.
How Settlement Notification Works
Let us take an example for the multiple-User model. Imagine a group of farmers and their wholesalers, who might have a Market for Wool.
Alice is a sheep farmer who has Wool to sell. Bob is a wholesaler who buys Wool for processing and selling on to his clients. Charlie set up the Market and operates it for the trade association.
Alice offers an amount of wool at a price that Bob considers good value, and their Orders execute. The execution creates two Fills, with the SettlementState field set to NEW. At this point, Alice and Bob know that their Orders have executed, but they do not yet know who their counterparty is. All Orders in a Market are anonymous.
Charlie, the Owner of the Market, downloads the Fills and finds the new Fills for this execution. Charlie's system calls the "notify settlement" endpoint of the API with the unique identifier for this execution. This prompts the system to send an email to Alice and Bob to let them know who they have traded with and to provide each of them with the email address of their counterparty.
Alice can now email Bob and say "I see that you have agreed to buy my wool at this price. How would you like to pay and where should I deliver it?" Alternatively, Bob might email Alice and initiate the settlement. Either way, they are now in contact and can organise settlement that is convenient for both of them.
Conclusion
This documentation section covered...
- Settlement Basics: Settlement is distinct from Price Negotiation, and is out of scope.
- Settlement Tracking: Settlement progress can be tracked within the system.
- Settlement Notification: Trading counterparties can be notified so that they can organise settlement between themselves.