It has being reported that some hackers have made it into the NASDAQ network which runs the stock market. But nothing to be alarmed they never got to the actual execution part of the system. For usual broker and trader this is quite upsetting news but after working with these types of systems for over 2 years I would say it isn’t too much to worry about.
Most exchanges run on piece of software that is quite unique to its own execution algorithms. Furthermore their gateway to the outside world is defined by a particular protocol such as FIX or ITCH or any other proprietary methods. So even if the hacker do reach in through the firewall and into the system, in order to create a real trading impact they have to talk in the particular protocol which is only limited to the trading activities. You may argue that they could shut down the system but most system run on Unix or Tandem machines so this is not too easy to deal with. What about listening to the wire transmission and getting information? Well then you need to understand the execution logic and build up the order book by yourself. So this won’t be a simple smash and grab at all. Therefore I am not surprised that the hackers just went in to show that they could break in not because they could make some money.
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