CME Group, Google Cloud to Build Private Cloud for Low-Latency Trading

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DateJun 27, 2024

CME Group and Google Cloud have announced their plan to build a new private Google Cloud region and a colocation facility in Aurora, Illinois. This initiative aims to transform the trading landscape by hosting a specialized platform tailored for CME Groups futures and options markets, offering derivatives traders ultra-low-latency networking and high-performance computing through cloud-based solutions.

The strategic location of this new private Google Cloud region in the Chicago area is set to leverage existing connectivity options and access points to other global markets. CME Groups clients would benefit from the flexibility of choosing between self-managed infrastructure within the colocation facility or Google Clouds specialized infrastructure-as-a-service (IaaS) offering. Both options promise equal network latency to the exchange, ensuring seamless operations.

This new platform is poised to deliver significant advantages to CME Groups clients. Key benefits would include enhanced operational efficiencies, greater flexibility, and improved access to cloud services and AI capabilities. These advancements are expected to deepen the value proposition for market users worldwide, allowing them to experiment, test, and deploy new strategies rapidly without disrupting their production trading environments.

CME Group Chairman and Chief Executive Officer Terry Duffy highlighted the transformative nature of this collaboration. This is a significant step forward in our partnership with Google Cloud that is revolutionizing our industry, he stated. Located within close proximity to our current data center campus, and with disaster recovery facilities in Dallas, Texas, Google Clouds new specialized platform will extend the benefits we can provide to our clients through next-generation cloud technology, expanded access and efficiencies, a broader range of customized connectivity options, and faster product development, with minimal disruption to their current operations.

Innovative AI and Data Capabilities

The collaboration would promise to bring more than just advanced infrastructure. Market participants migrating to the cloud will tap into Google Clouds extensive global network and innovative AI and data capabilities. Google Clouds suite of products, including BigQuery and AlloyDB, along with its AI and machine learning platform, Vertex AI, will enable financial institutions to experiment with new modeling techniques like time-series forecasting and leverage generative AI for enhanced insights. These tools are supported by Google Cloud’s expansive network and robust AI-powered security.

Thomas Kurian, CEO of Google Cloud, expressed enthusiasm about this collaboration. Our latest milestone with CME Group builds on our shared goal to accelerate CMEs move to the cloud and innovate capital markets infrastructure worldwide. Through our collaboration, were harnessing the best of cloud computing, data analytics, and AI, while respecting the existing custom hardware requirements of market participants to bring low latency, deterministic, and scalable trading environments to CME Group customers and the broader financial markets.

The development of this specialized platform is already underway, with initial capabilities available for customer testing in the Dallas Google Cloud region, which will eventually serve as the disaster recovery facility. Construction of the private Google Cloud region in Aurora is set to commence this year, with CME Group planning to provide clients with at least 18 months advance notice before the markets transition to the new platform. Meanwhile, CME Groups cash markets will continue to operate from their current facilities.

Since the announcement of their partnership in 2021, CME Group and Google Cloud have been making strides on several key initiatives. These include enhancements to CME Groups cloud-based data platform and the migration of critical clearing applications to the cloud. Both companies are dedicated to delivering substantial benefits to all market participants by expanding access, creating real-time, customer-centric data and analytics capabilities, launching new products and services, and boosting overall efficiencies.

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