In the world of cryptocurrency trading, a millisecond of delay can determine millions of dollars in profit or loss.

While most traders are still pursuing lower transaction fees, some have already reached the top of the ecosystem. Globally, there are fewer than thirty institutions that can access Binance VIP9, and one of them has chosen to step out of the existing track and transform years of accumulated technical advantages into external services.

Its name is QTX, which is currently the only technology service company founded by a Binance VIP9 team. In 2022, they were the first to withdraw from FTX and, within just two months, increased their trading volume on Binance from VIP1 to VIP9. Today, QTX is no longer just a high-frequency trading team hidden in the market; it has built a low-latency system into infrastructure for the entire industry.

The development trajectory of QTX itself is a microcosm of the evolution of high-frequency trading in cryptocurrency.

QTX: Redefining Cryptocurrency Trading Infrastructure

Founded in 2024, QTX is a technology service company focused on cryptocurrency trading infrastructure. They package years of accumulated practical experience into products, aiming to provide the industry with ultra-low latency systems and a more efficient trading environment.

The core team of QTX can be considered a "dream team" in the field of cryptocurrency high-frequency trading.

Co-founder and CEO Xu Jingteng has over 15 years of experience in cross-border market operations and team management, having served as a senior executive at Nu Skin, managing a team of over 500 people. Another co-founder and CTO, Dai Zhiyang, is a co-founder of Taiwan's largest BBS site PTT, has worked at Yahoo and KKBOX, and has served as Chief Engineer at Kronos Research. He has over 25 years of software development experience and 10 years of practical blockchain experience. They were former comrades at Quantrend Technology, where they built a futures market-making firm that became one of the top ten globally within two years.

The stability of QTX's system has been tested in the industry. The trading system is entirely written in Rust, and according to Xu Jingteng, it has never experienced downtime in the past four to five years, even maintaining normal operations when the trading platform itself goes down. This stability is crucial in high-frequency trading, as any interruption can lead to significant losses.

In terms of latency optimization, QTX has also made differentiations. The team continuously refines every detail, from cloud service nodes to data center placements to trading platform access, with all links layered to create a gap.

Based on these accumulations, QTX has built a TaaS (Technology as a Service) system covering data acquisition, order execution, volume management, and cross-regional connections. For example, in data services, QTX can control the lightning market latency on Binance to an average of 1.66 milliseconds, far below the industry average of 5 milliseconds; in the order placement phase, the execution efficiency of the lightning order module is three times faster than that of peer trading institutions; in volume management, they help clients complete over 10 billion USDT in futures trading and 3 billion USDT in spot trading each month.

Additionally, QTX has launched cross-regional dedicated lines and historical data services. The former enhances execution speed across trading platforms by over 30% through low-latency networks, providing assurance for arbitrage and risk hedging; the latter offers market data with higher precision than traditional K-line data for strategy backtesting and model training.

Xu Jingteng told Rhythm BlockBeats: "We hope that when clients use QTX, they can focus more on strategy development while leaving the complex technology and infrastructure to QTX. We have set up all low-latency networks for you; all you need is for your engineers to connect with QTX to enjoy all point-to-point services with the lowest latency in the industry in one stop."

In a sense, this company is transforming the low-latency capabilities that only top trading institutions could master into a shared infrastructure for the industry.

From Traditional Industry to Binance VIP9: A Twisted Entrepreneurial Journey

Xu Jingteng's career began in the consumer goods and internet industries, where he led a team of over 500 people responsible for market expansion in Greater China and Southeast Asia.

In 2020, he co-founded an AI-driven high-frequency quantitative company with a partner, which quickly became one of the top ten futures market makers globally within two years. Initially entering the cryptocurrency industry without a relevant background, he gradually ventured into this unfamiliar field due to his trust in his partner. The low barriers to entry and unique opportunities in the crypto market ultimately led him to decide to make the transition.

Subsequently, the black swan event of FTX became a significant turning point for him, making him realize the critical role of technical capabilities in risk prevention and prompting him to move towards technology services.

Rhythm BlockBeats: Can you introduce yourself? Including the fields you were previously engaged in, as well as the opportunities for transformation and entrepreneurship.

Xu Jingteng: I previously focused on consumer goods and internet businesses, responsible for market expansion in Greater China and Southeast Asia, with a team size of around 500 people. Because I was in charge of international market expansion, I accumulated some experience in cross-border business, brand awareness, and market sensitivity.

In 2020, I co-founded Quantrend Technology with an old friend I had known for over a decade, focusing on AI-driven high-frequency quantitative trading. He is a technical genius, while I was responsible for market expansion and team operations outside of technology. There, we grew to become one of the top ten futures market makers globally in just two years.

However, during this process, I discovered a significant problem: high-quality trading infrastructure and technical services are extremely scarce in the market, and talents with expertise in Rust are even rarer. Many teams with excellent strategy capabilities in the crypto market cannot truly unleash their potential due to high technical barriers; while some top teams from traditional finance struggle to exert their strengths due to unfamiliarity with the structure of the crypto market.

This is the original intention behind my founding of QTX, a technology service provider with years of experience at the highest VIP level in Binance.

Rhythm BlockBeats: In your view, what are the differences between high-frequency trading in the crypto industry and traditional finance, aside from the differences in scale?

Xu Jingteng: The entry barriers and trading costs are significant differences. Almost every aspect of traditional finance requires licenses, and without corresponding institutional resources, it is nearly impossible for an average person to profit from high-frequency trading. In contrast, the barriers to entry in the cryptocurrency market are much lower; for example, some people can set up a server on AWS and apply for an API interface from a trading platform to test small programs, even making money with their own high-frequency arbitrage software.

Traditional finance requires purchasing hardware, laying fiber optics, and meeting various compliance requirements, which is an arms race. In the crypto market, it is relatively fair. This was also one of the reasons we later decided to establish QTX.

Rhythm BlockBeats: You mentioned that the FTX incident was a turning point; can you share what happened at that time?

Xu Jingteng: We launched on FTX in 2021, and at that time, our trading strategy performed very well, with low latency and strong profitability, quickly reaching the highest level. However, about a month or two later, we discovered some anomalies in the profit curve and order situation using our self-developed visualization tools.

Because our team has a strong technical foundation in trading engines, we were very clear that the problem was not on our end. After meeting with the FTX technical team, we confirmed that there were some unfair and even fraudulent behaviors internally.

So at the end of 2021, we began collecting relevant evidence and fully withdrew from FTX in the first quarter of 2022, moving to Binance to rebuild a brand new high-frequency trading system.

Rhythm BlockBeats: Can you share any details about your transition to Binance?

Xu Jingteng: In the third quarter of 2022, we went from VIP1 to VIP9 in just two months, and we did not go through a trial period at all, which was quite rare at the time. We actually didn't know there was a trial period process, so we directly achieved VIP9 in those two months. Generally, institutions start from lower levels, but we quickly reached VIP9 due to our technical strength and trading volume, which attracted some attention. It is worth mentioning that in 2023, we were also one of the fewer than ten institutions globally to achieve the highest level MM5 for futures market makers at Binance.

When we were at FTX, we also warned some clients that we felt there were many unreasonable aspects. However, many people at the time thought that a small team of a dozen people could not uncover the truth. It wasn't until FTX truly collapsed that they realized our judgment was correct, which also strengthened some investors' recognition of us.

Rhythm BlockBeats: What impact did the FTX incident have on your business?

Xu Jingteng: For us, this was an important turning point. Although we withdrew early, this incident made us more clearly aware that if there were more reliable tools, many risks could actually be avoided. So we began to think about how to provide more stable and reliable technical services for the entire industry. This was also a direct motivation for the later establishment of QTX.

Technical Strength and Competitive Advantage: Finding a Moat in Change

As traditional financial institutions gradually enter the cryptocurrency market, the competitive barriers for high-frequency trading are rapidly increasing. Xu Jingteng believes that although large institutions have abundant resources, they still have limitations in flexibility and latency optimization.

QTX's advantage lies in being the only technology service provider that has completely transformed from a VIP9 market-making team, with the team honing their skills in a top-tier low-latency environment, possessing strong system stability and full-stack technical capabilities. From system language selection to cross-regional latency optimization, QTX has established differentiated barriers across multiple dimensions.

At the same time, they have productized these capabilities, forming a series of services such as lightning market data, lightning order placement, trading volume enhancement plans, and cross-regional dedicated lines, gradually expanding into low slippage order execution, historical data, and AI application fields.

Rhythm BlockBeats: If an institution wants to build a Binance VIP9 trading environment similar to QTX, how much investment is required?

Xu Jingteng: First, you need to become Binance's VIP9 and maintain it for at least a year. This cannot be achieved just by throwing money at it. For example, a month of VIP9 requires a trading volume of 25 billion USD in futures, which amounts to 25 billion multiplied by 12 for a year.

If the model is losing money, even if it only loses 0.5 basis points, it could result in losses of over ten million dollars in a year; if the system has issues, the principal could also suffer significant losses; if there are errors in the fee rates, the losses could be even higher. So no one can guarantee that they can maintain VIP9 status for a year with just a few tens of millions of dollars.

More critically, the market environment is constantly changing. The market conditions in 2022 and 2023 are completely different. To continuously maintain VIP9, constant optimization and maintenance are required, which is the most challenging part.

Rhythm BlockBeats: In your perception, is the current competitive threshold for high-frequency trading in the crypto field gradually increasing or decreasing? What will the competitive landscape look like in the next two to three years? In which areas will competition be the fiercest?

Xu Jingteng: I believe that the competitive threshold will definitely increase in the future, as more traditional financial institutions enter the market with stronger resources and capital.

However, the crypto market changes rapidly, requiring strong adaptability. Many excellent traders are like race car drivers; without a good engine or infrastructure, even the strongest individual abilities are hard to leverage.

I think the competition for Alpha will be the fiercest in the future, but QTX can provide the infrastructure with top-tier competitiveness, allowing trading teams to focus their energy on strategies and Alpha instead of spending time building complex low-latency systems. We hope to use technology to enable more people to access tools that were previously only available to top trading institutions.

Rhythm BlockBeats: What impact will the entry of traditional financial institutions have on the existing landscape?

Xu Jingteng: Their entry will bring more intense competition, but there are also clear disadvantages.

The uniqueness of the crypto market lies in the fact that it is not just a trading market but also an innovative ecosystem. Understanding DeFi, NFTs, and trading opportunities in emerging public chains requires a deep understanding of this ecosystem. Companies with traditional financial backgrounds may need time to adapt their strategies.

For technology service providers like us, our biggest advantage is that we were born for the crypto market from day one. Our technical architecture, product design, and service model have been deeply optimized for the unique needs of the crypto market. The flexibility of a small company also allows us to maintain a very fast product iteration speed. Since mid-2024, we have developed and launched new products on average every four months. At the same time, we do not have rigid thinking; our client base includes top institutions like Binance VIP9 as well as large retail traders, making our application scenarios extremely flexible.

Rhythm BlockBeats: After low-latency competition becomes more widespread, what abilities do you think the industry will shift towards competing in?

Xu Jingteng: I often say that there are definitely companies faster than QTX in the world, but QTX is the only one in the market that offers the fastest service for rent. The reason is simple: other companies that have maintained VIP9 for years do not come out to do this. We are the only team that has opened up top-tier infrastructure to the outside.

If in the future everyone has similar conditions regarding latency, then competition will shift to dimensions such as strategy, ecosystem, and capital volume. It is difficult to achieve complete consistency in latency optimization, but even if it is achieved, the competition will focus on these aspects.

Rhythm BlockBeats: You just mentioned that other VIP9 companies do not come out to provide technical services; could you explain this in detail?

Xu Jingteng: There are only a few dozen companies that have maintained VIP9 status globally. Most of them are large institutions that usually operate independently in different departments; for example, one department focuses on Alpha, while another focuses on Infra, with little communication between them, making it difficult to offer a complete set of technology as a service. Their resources and focus are primarily on trading operations. For them, maintaining a competitive advantage is more important than opening up technology.

We are different; our entire team has grown in the most competitive top-tier market-making environment over the years. We have refined both high-frequency and mid-low frequency strategies, making us the technology service provider that understands trading teams the best. We understand trading logic and underlying architecture, and we can productize these experiences, combining technical depth with product thinking, which is also why others find it difficult to compete with us.

Rhythm BlockBeats: Can you specifically introduce QTX's core technical advantages?

Xu Jingteng: There are two core points.

The first is system stability. Our trading system is entirely written in Rust, and it has never experienced downtime. The code is highly modular, making development both flexible and efficient, while also making complex systems easier to maintain and use.

The second is our deep understanding of the cryptocurrency market accumulated over many years. We have gained practical experience in the crypto market, working in various strategy areas such as order book arbitrage, CTA, Long/Short, and high-frequency market-making strategies. From millisecond-level high-frequency predictions to day-level trend judgments, and to the ultimate pursuit of latency optimization, we have undergone complete validation and iteration.

Rhythm BlockBeats: Can you specifically introduce QTX's lightning market data service?

Xu Jingteng: This is an ultra-low latency market data stream solution. The average latency from Binance's event time to our local system is only 1.66 milliseconds, while the industry average is about 5 milliseconds.

For high-frequency trading, such a gap is crucial. After clients connect, they report a significant improvement in speed.

Rhythm BlockBeats: Besides lightning market data, what other core products does QTX offer?

Xu Jingteng: We also have a lightning order service, which allows for order execution delays that are lower than those of internal modules on trading platforms due to our unique optimal trading environment. During periods of high market volatility, our lightning order can provide an average latency advantage that is nearly three times that of other trading institutions at the same Binance VIP level.

Additionally, we have a trading volume enhancement plan that helps clients achieve or maintain high VIP levels and reduce trading fees. Currently, we have helped clients complete over 10 billion USDT in futures trading volume and 3 billion USDT in spot trading volume each month.

We also offer cross-regional dedicated line services, which can improve execution speed across trading platforms by over 30% through low-latency cross-regional connections.

Rhythm BlockBeats: Can you share how these products have improved clients' performance in practice?

Xu Jingteng: For example, lightning market data is a service whose speed we have publicly disclosed; the average latency from Binance's matching engine to our system is 1.66 milliseconds. If clients find this speed fast enough, they will come to us.

The lightning order service is particularly effective during periods of extreme market volatility. For instance, when Bitcoin or Ethereum experiences sudden large fluctuations, trading platforms often become "congested," and latency can reach several hundred milliseconds. Our interface, however, can still maintain a speed that is nearly three times faster than the industry average in such situations. The difference lies in whether you can successfully cancel or place an order at a critical moment. Clients have also reported that our advantages are very apparent during extreme market conditions.

Rhythm BlockBeats: What is QTX's historical data service like?

Xu Jingteng: For quantitative trading teams, data is the foundation of strategies, but processing it is often the most complex and labor-intensive task. Our historical data comes from the lowest latency market sources at the time and is processed with precision to ensure the highest accuracy and reliability.

For example, we collect data directly from colo or matching points, retaining original low-latency data with latency markers, and provide it after data validation and integrity checks, with data precision that is more refined than that of other companies in the market. We provide tick-by-tick trading data, not just K-line data, with higher data quality, akin to "4K quality." This is crucial for high-frequency trading users when conducting strategy backtesting.

In quantitative trading, historical data is a necessity. Since it must be purchased, why not choose the highest quality data that can support all strategies?

Rhythm BlockBeats: How do you view the application of AI in high-frequency trading?

Xu Jingteng: I believe AI is an inevitable trend for a simple reason: without AI, the volume of information you can process is limited, while we have been using AI from day one, ensuring that we always stay ahead.

In high-frequency trading, everyone is competing on speed and accuracy. QTX can help with speed, but accuracy is like a competition where each person relies on their own abilities to win.

AI is mainly applied in two areas here: one is trading volume optimization, and the other is low slippage execution. For example, when executing large orders, AI can help predict market trends, thereby reducing impact costs. Our low slippage execution product, launched in the third quarter, is supported by AI algorithms.

For instance, if you are market-making on Binance futures, given the current market conditions, a VIP5 can obtain MM1 market maker qualifications, while VIP9 can obtain MM4 market maker qualifications, with a fee rate difference of 0.4 basis points. By using our low slippage execution service, it is equivalent to having the qualifications of VIP5 while enjoying cost advantages close to VIP9. Over the long term, the cost savings are substantial. This is the practical application scenario of AI in high-frequency trading.

Clients as Investors: Unique Validation of the Business Model

As QTX's technical capabilities gradually open up, their client base is also rapidly expanding. From top quantitative funds to market makers and family offices, they are enhancing their competitiveness by renting QTX's low-latency and stable systems.

At the same time, compliance issues, financing purposes, and the launch of future new features are also key points of external concern. Xu Jingteng shared specific client profiles and QTX's plans for the next two to three years during the interview.

Rhythm BlockBeats: What does your client profile look like? What are their most pressing needs?

Xu Jingteng: Our client base is quite clear. Taking Binance as an example, among clients below VIP6, there are many excellent traders, but they face technical and latency barriers, and we can provide assistance. At the same time, many clients at VIP7, 8, and 9 also choose us. They may be strong in futures but need optimization in spot trading or hope we can help them improve latency.

Recently, we have also received requests from leading traditional high-frequency quantitative institutions in Greater China, asking us to help optimize their internal latency. Although they have people working on it internally, the efficiency is too slow, so they ask us to conduct A/B testing and pay a fee for our assistance. They know that spending a year figuring it out themselves could result in losing their advantage. By renting our services, they can immediately save time to focus on strategy and Alpha research.

Overall, our clients can be divided into three categories:

The first category is quantitative funds, which have strategies and Alpha but lack a high-quality execution environment. Using our services can immediately validate and amplify their strategy effects.

The second category is market makers, who need stable APIs across multiple trading platforms and faster interfaces, which we can provide.

The third category includes large arbitrage institutions, family offices, or financial institutions that need better rates and execution environments, and we can also provide related services.

Rhythm BlockBeats: Besides standardized services, do you also do some customized technical development for clients?

Xu Jingteng: Yes, we often discuss their overall trading strategies with clients, whether they are doing cross-exchange arbitrage or which part of spot or futures has a larger volume. Then we help them customize tools to optimize their trading environment.

The customized part is actually quite important in the early stages, but once the tools are delivered, they can use them independently. We mainly provide the underlying engine and architecture, allowing them to run strategies on top of it.

Rhythm BlockBeats: How do you view the future impact of regulation on your business?

Xu Jingteng: In fact, compliance does not have a significant impact on us. Because we do not directly participate in trading, we provide technical tools. How clients trade is their own business. Logically, by deciding to purchase our services, they have already addressed the compliance issue.

Some of our clients are even top quantitative institutions and Binance VIP9, who have invested in us because they believe our products are neutral and have low compliance risks. Some traditional venture capital firms are also willing to invest in us based on the same judgment.

Rhythm BlockBeats: Can you summarize QTX's core competitiveness and future plans?

Xu Jingteng: Our advantages mainly come from several aspects:

First, we have a trading background and a deep understanding of technology, knowing what the real pain points are;

Second, we have accumulated execution capabilities and market insights, allowing us to quickly capture client needs;

Third, we are not just a simple system integrator; we design systems for the crypto market from the underlying architecture, so we have unique advantages in latency, stability, and scalability.

In the future, we hope to provide not just a single platform but a complete architecture for our clients. Subscribing to QTX's services is equivalent to subscribing to a top-tier low-latency team, allowing clients to focus solely on their strategies.

Rhythm BlockBeats: After the financing, which key areas will the funds be invested in?

Xu Jingteng: Most of the funds will still be invested in technology research and development, with a small portion used for brand expansion. Technology development has always been our core focus.

One of the most important directions is low slippage execution, which can help clients save a lot of costs, allowing them to enjoy lower execution fees without needing to maintain VIP levels.

Secondly, we will develop some visualization systems to allow clients to see their trading status in the market more intuitively, helping them better manage their funds and strategies. Our positioning has always been to create tools, not to replace traders' judgment, but to help them execute better in the market.

Many of the investors in this financing round are actually our clients. They were originally Binance VIP7, 8, and 9 users, and after using our services, they decided to invest in us.

This is a significant affirmation for us and indicates that our products indeed address industry pain points. In the future, we will continue to modularize our products, such as visualization tools and low slippage execution systems, allowing more traders to access these capabilities.

Rhythm BlockBeats: You mentioned that many investors are also your clients?

Xu Jingteng: Yes, many of our investors are our clients. They first used our services, found the results very good, and then decided to invest in us. This is actually the best validation of our products and services.

For example, we have a client who saw significant improvements in trading performance after using our lightning market data service, and then he decided to invest in us. This model makes our financing process very natural because investors have a deep understanding of our business model and technical capabilities.

Rhythm BlockBeats: What benefits does this model bring to the company's development?

Xu Jingteng: First, this model makes our product development more targeted. Since our investors are our users, their needs reflect market demands. We do not need to guess what the market needs; our clients will tell us directly.

Secondly, this model stabilizes our client relationships. Investors, as shareholders, want the company to succeed, so they are more willing to use our services long-term and help us recommend new clients.

Finally, this model makes our financing easier. Because investors are familiar with our business model, they understand our technical capabilities and market prospects, making the financing process smoother.

Rhythm BlockBeats: What is the current scale of QTX's client base?

Xu Jingteng: Our current clients include some well-known trading institutions and individual traders. Due to confidentiality agreements, I cannot disclose specific client names, but I can say that our clients generally have high VIP levels on Binance.

Our services help clients generate over 10 billion USDT in futures trading volume and 3 billion USDT in spot trading volume each month. This figure illustrates the scale of our services and the quality of our clients.

Rhythm BlockBeats: How do you view the future of the cryptocurrency high-frequency trading industry?

Xu Jingteng: I believe there is still a lot of room for development in this industry. As the cryptocurrency market continues to mature, the demand for professional technical services will grow.

The entry of traditional financial institutions will bring more competition but also a larger market. We believe that technological advantage is the most important moat; as long as we can maintain technological leadership, we can secure a place in this market.

Our goal is to become the infrastructure provider for this industry, similar to AWS's position in cloud computing. We hope that through our technical services, more traders can participate in high-frequency trading, driving the development of the entire industry.

Rhythm BlockBeats: Finally, what advice do you have for newcomers wanting to enter this industry?

Xu Jingteng: I think the most important thing is to have a solid technical foundation. This industry has high technical requirements, and if you do not have sufficient technical capabilities, it is difficult to survive in this market. High-frequency trading is not a quick way to get rich; it requires long-term accumulation and continuous learning.

Finally, choose good partners and service providers. In this industry, a good technical service provider can help you achieve more with less effort.

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