US overnight trading platform gears up to make comeback in Korea

US alternative trading system Blue Ocean ATS hopes to resume trading service for Korean investors soon, following a six-month halt sparked by its system crash in August.

Operated by Blue Ocean Technologies, the ATS provides overnight trading of US stocks, enabling Korean investors to trade during their daytime hours.

“We have invested in Korea with our technology, support and compliance. I believe we are close (to recommence the service),” Blue Ocean Technologies CEO and President Brian Hyndman said in an interview held with The Korea Herald at a hotel in Yeouido, western Seoul, Thursday.

In August, Blue Ocean shut down its matching engine due to a surge in trade volume, resulting in the cancellation of orders worth 630 billion won ($435 million) across 90,000 accounts here. Since then, local securities firms have suspended the service.

As the brokerage houses requested Blue Ocean Technologies to set up measures to prevent relapse, the company has completed the immigration to a new server and set up a new accommodation policy for investor protection.

Though the compensation dispute over the outage was not the key reason that stopped the trading, Blue Ocean Technologies recently worked out a new accommodation policy, which includes financial compensation of up to $250,000 per month.

At the time of the incident, the company did not have the rules for compensation. It is not the standard for an ATS to have a compensation policy in the US, according to Hyndman.

"But I wanted to do that (come up with a compensation policy) for Korea going forward to give (the investors) a level of comfort," he said.

For a better local presence, the company has set up an office in Seoul, appointing former representative director of LSEG Korea Kim Suk-joon as vice president and head of the north Asia-Pacific region.

“We fully demonstrated in the proof that we are ready to accommodate any businesses from Korea and most of the Korean customers are eager to resume businesses with us anytime," Kim said while joining the interview.

According to Kim, Korean brokerage firms have shown a willingness to resume trading with Blue Ocean.

"(The brokers) are waiting for the signal from the Financial Supervisory Service and Korea Financial Investment Association (Kofia)," Kim assessed, explaining Blue Ocean relies on the association to communicate with the financial regulator. Kofia is a representative body of the local brokerage firms.

"The association is likely to poll the brokers to make sure that everybody is comfortable trading soon," Hyndman said, projecting the statement of the market inclination will help resume the business.

While Korea had accounted for 65 percent of Blue Ocean ATS' share volume prior to the outage, the business has been growing strong even without the country, according to Hyndman.

“A lot is going on in the US equity markets with the new president’s tariffs, Deepseek, and AI stocks. We had three record days in the past month -- record national volume being traded on Blue Ocean even without Korea,” Hyndman said.

Despite the stable growth, Blue Ocean Technology wants Korea back on the table.

“Korea is a big part of our business. We want to get it back and we want to give the customers the offering that they are used to,” Hyndman said.

While the daytime trading of US stocks for Korean investors had been exclusively offered by Blue Ocean, the market competition is likely to grow. More US exchanges are gearing up to expand their trading hours into the night hours, such as Moon ATS and 24X Exchange. Though Blue Ocean enjoyed its exclusivity in Korea, Hyndman welcomes the new competition.

“If we have a couple of competitors trading in the overnight space, the market is going to get bigger,” Hyndman said. “Do I want to do 100 percent of 50 million shares or do I want to do 40 percent of half a billion shares, right?”