# How Do MiFID II Waivers Impact RFQ Anonymity? ▴ Question

**Published:** 2025-08-09
**Categories:** Question

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![A metallic, modular trading interface with black and grey circular elements, signifying distinct market microstructure components and liquidity pools. A precise, blue-cored probe diagonally integrates, representing an advanced RFQ engine for granular price discovery and atomic settlement of multi-leg spread strategies in institutional digital asset derivatives](https://options.greeks.live/wp-content/uploads/2025/08/institutional-digital-asset-derivatives-rfq-protocol-system-facilitating-high-fidelity-execution-price-discovery.jpg)

![Central reflective hub with radiating metallic rods and layered translucent blades. This visualizes an RFQ protocol engine, symbolizing the Prime RFQ orchestrating multi-dealer liquidity for institutional digital asset derivatives](https://options.greeks.live/wp-content/uploads/2025/07/high-fidelity-digital-asset-rfq-execution-and-liquidity-management.jpg)

## Concept

The Markets in Financial Instruments Directive II (MiFID II) established a comprehensive framework for [pre-trade transparency](https://prime.greeks.live/area/pre-trade-transparency/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite), intending to illuminate European financial markets. The directive’s primary goal was to ensure that quotes and depths of trading interest are made public before a trade occurs, fostering a more efficient price discovery process for all participants. This principle applies broadly across various trading systems, including the Request for Quote (RFQ) protocols frequently used for instruments that are less liquid than centrally-cleared equities. An RFQ system allows an initiator, typically a buy-side institution, to solicit quotes from a select group of [liquidity providers](https://prime.greeks.live/area/liquidity-providers/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) for a specific financial instrument.

![Abstract geometric forms, including overlapping planes and central spherical nodes, visually represent a sophisticated institutional digital asset derivatives trading ecosystem. It depicts complex multi-leg spread execution, dynamic RFQ protocol liquidity aggregation, and high-fidelity algorithmic trading within a Prime RFQ framework, ensuring optimal price discovery and capital efficiency](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocol-liquidity-aggregation-market-microstructure-high-fidelity-execution-alpha-generation-prime-os-capital-efficiency.jpg)

## The Inherent Conflict in Transparency

For large institutional orders or trades in illiquid assets, the very act of revealing trading interest can be self-defeating. This phenomenon, known as [information leakage](https://prime.greeks.live/area/information-leakage/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite), occurs when the pre-trade disclosure of a large order signals the institution’s intentions to the broader market. Other participants can trade ahead of the large order, causing the price to move against the initiator before the full order can be executed.

This results in higher execution costs, a concept referred to as [market impact](https://prime.greeks.live/area/market-impact/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) or slippage. The core conflict is that a mandate for universal pre-trade transparency, while beneficial for small, liquid trades, can impose significant costs on the large-scale transactions that are vital for institutional fund management.

![A sleek spherical mechanism, representing a Principal's Prime RFQ, features a glowing core for real-time price discovery. An extending plane symbolizes high-fidelity execution of institutional digital asset derivatives, enabling optimal liquidity, multi-leg spread trading, and capital efficiency through advanced RFQ protocols](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-platform-for-high-fidelity-execution-and-optimal-liquidity.jpg)

## The Structural Role of Waivers

Recognizing this conflict, regulators embedded specific waivers within the [MiFID II](https://prime.greeks.live/area/mifid-ii/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) framework. These waivers are not intended to undermine transparency but to calibrate it according to the nature of the trade and the instrument. They provide a sanctioned mechanism for trading venues, such as Multilateral Trading Facilities (MTFs) and Organised Trading Facilities (OTFs), to bypass the full pre-trade transparency requirements under specific, well-defined conditions.

By doing so, waivers create pockets of reduced transparency that are essential for the effective functioning of institutional markets. They allow large orders to be negotiated and executed with a degree of discretion that protects the initiator from the full, immediate impact of their own trading activity.

> MiFID II waivers act as a regulatory pressure valve, balancing the systemic goal of market transparency with the practical necessity of discreet execution for large-scale trades.

The most relevant waivers in the context of [RFQ anonymity](https://prime.greeks.live/area/rfq-anonymity/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) are those for Large-in-Scale ([LIS](https://prime.greeks.live/area/lis/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite)) orders, orders held in an Order Management Facility (OMF), and trades in instruments deemed to have an illiquid market. When an RFQ is processed under one of these waivers, the trading venue is absolved from the obligation to publicize the details of the quote request to the entire market. This structural adjustment is the foundation upon which RFQ anonymity is preserved. It shifts the protocol from a public announcement to a private inquiry, fundamentally altering the information landscape for the participants involved.

![A complex, intersecting arrangement of sleek, multi-colored blades illustrates institutional-grade digital asset derivatives trading. This visual metaphor represents a sophisticated Prime RFQ facilitating RFQ protocols, aggregating dark liquidity, and enabling high-fidelity execution for multi-leg spreads, optimizing capital efficiency and mitigating counterparty risk](https://options.greeks.live/wp-content/uploads/2025/07/sophisticated-multi-asset-rfq-architecture-visualizing-institutional-digital-derivatives-execution-liquidity-aggregation-and-prime-os-orchestration-for-high-fidelity-performance.jpg)

![A sleek, reflective bi-component structure, embodying an RFQ protocol for multi-leg spread strategies, rests on a Prime RFQ base. Surrounding nodes signify price discovery points, enabling high-fidelity execution of digital asset derivatives with capital efficiency](https://options.greeks.live/wp-content/uploads/2025/07/precision-orchestration-of-institutional-digital-asset-derivatives-rfq-protocols-for-optimal-market-microstructure.jpg)

## Strategy

The strategic application of MiFID II waivers within RFQ systems is a critical component of institutional execution policy. The decision of where and how to execute a large trade involves a careful analysis of the trade-offs between liquidity access, execution cost, and information leakage. Waivers provide a powerful tool for managing these trade-offs, particularly the mitigation of information leakage. The availability of pre-trade transparency waivers on venues like MTFs and OTFs creates a distinct strategic advantage compared to other execution channels, such as dealing with a [Systematic Internaliser](https://prime.greeks.live/area/systematic-internaliser/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) ([SI](https://prime.greeks.live/area/si/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite)).

![Stacked precision-engineered circular components, varying in size and color, rest on a cylindrical base. This modular assembly symbolizes a robust Crypto Derivatives OS architecture, enabling high-fidelity execution for institutional RFQ protocols](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-rfq-protocol-architecture-optimized-for-high-fidelity-execution.jpg)

## Comparative Execution Venues

An institutional trader must consider the level of anonymity afforded by different execution methods. The choice of venue has direct consequences for the degree of information disclosed, both about the initiator of the trade and the liquidity providers who respond. The following table outlines the strategic considerations across different execution channels:

### Table 1 ▴ Comparison of Execution Channels and Anonymity

| Execution Channel | Initiator Anonymity (from Public) | Responder Anonymity (from Public) | Pre-Trade Transparency Requirement | Governing Protocol |
| --- | --- | --- | --- | --- |
| Lit Order Book | Partial (Orders are anonymous, but size is visible) | N/A (Central Limit Order Book) | Full | Price/Time Priority |
| Systematic Internaliser (SI) RFQ | Full (Bilateral communication) | None (SI identity is public) | SI must publish firm quotes | Bilateral Negotiation |
| Venue RFQ (with LIS Waiver) | Full | Full | Waived | Venue-Managed Auction |
| Venue RFQ (No Waiver) | None (RFQ details are made public) | Partial (Quotes may be public) | Full | Venue-Managed Auction |

As the table illustrates, a venue-based RFQ executed under a Large-in-Scale (LIS) waiver offers the highest degree of anonymity for all parties involved. Unlike an SI, which must publish its identity alongside its quotes, liquidity providers responding to a waivered RFQ on a venue can remain anonymous to the broader market. This encourages more competitive pricing from responders, as they are shielded from the potential reputational risk or subsequent market pressure that could result from being identified as the winning bidder on a large, sensitive trade.

![A precision sphere, an Execution Management System EMS, probes a Digital Asset Liquidity Pool. This signifies High-Fidelity Execution via Smart Order Routing for institutional-grade digital asset derivatives](https://options.greeks.live/wp-content/uploads/2025/07/principal-rfq-engine-orchestrating-global-digital-asset-derivatives-liquidity-pool-price-discovery-and-high-fidelity-execution.jpg)

## Strategic Implementation of Waivers

The strategic decision to utilize a waivered RFQ protocol involves several key considerations:

- **Order Size Assessment** ▴ The first step is to determine if the order qualifies for a waiver, primarily the [LIS waiver](https://prime.greeks.live/area/lis-waiver/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite). This requires checking the order size against the instrument-specific LIS threshold defined by regulators.

- **Liquidity Provider Selection** ▴ Even within an anonymous protocol, the initiator selects the group of liquidity providers to whom the RFQ is sent. This allows the initiator to balance the need for competitive tension with the desire to protect information by limiting the number of counterparties who see the order.

- **Information Control** ▴ The use of a waivered RFQ is a deliberate strategy to control the release of information. The goal is to find sufficient liquidity to execute the trade without alerting the wider market, thereby minimizing the potential for price impact.

- **[Best Execution](https://prime.greeks.live/area/best-execution/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) Analysis** ▴ The decision must be justifiable from a best execution perspective. While minimizing market impact is a key component of best execution, the trader must also consider the price, speed, and likelihood of execution offered by the waivered RFQ process compared to other available options.

![A futuristic apparatus visualizes high-fidelity execution for digital asset derivatives. A transparent sphere represents a private quotation or block trade, balanced on a teal Principal's operational framework, signifying capital efficiency within an RFQ protocol](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-execution-via-prime-os.jpg)

![Abstract spheres and linear conduits depict an institutional digital asset derivatives platform. The central glowing network symbolizes RFQ protocol orchestration, price discovery, and high-fidelity execution across market microstructure](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-high-fidelity-execution-4.jpg)

## Execution

The execution of a trade using an RFQ protocol under a MiFID II waiver is a precise operational process. It relies on the technological capabilities of the trading venue (MTF or [OTF](https://prime.greeks.live/area/otf/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite)) to manage the flow of information in a compliant manner, ensuring that the protections afforded by the waiver are maintained. The process for a buy-side trader looking to execute a large block trade in a corporate bond via an LIS-waivered RFQ provides a clear illustration of the mechanics involved.

![A transparent, blue-tinted sphere, anchored to a metallic base on a light surface, symbolizes an RFQ inquiry for digital asset derivatives. A fine line represents low-latency FIX Protocol for high-fidelity execution, optimizing price discovery in market microstructure via Prime RFQ](https://options.greeks.live/wp-content/uploads/2025/07/digital-asset-rfq-protocol-sphere-high-fidelity-execution-gateway.jpg)

## Operational Workflow of a Waivered RFQ

The following steps outline the typical execution workflow, highlighting the points at which anonymity is preserved:

- **Pre-Trade Analysis** ▴ The buy-side trader’s Order Management System (OMS) or Execution Management System (EMS) identifies an order as being eligible for the LIS waiver by comparing its size to the regulatory threshold for the specific bond.

- **Venue and Counterparty Selection** ▴ The trader selects an MTF that supports LIS-waivered RFQs. Within the platform, the trader compiles a list of preferred liquidity providers to receive the RFQ. This list is kept private and is known only to the trader and the venue operator.

- **RFQ Submission** ▴ The trader submits the RFQ to the selected liquidity providers through the venue’s platform. The RFQ contains the instrument identifier, the size of the order, and the desired side (buy or sell). The initiator’s identity is masked from the liquidity providers; they see the request as originating from the venue itself.

- **Quote Submission by Responders** ▴ The selected liquidity providers respond with their respective quotes. Their identities are also masked from the initiator. The trader sees a list of anonymous, actionable quotes.

- **Execution** ▴ The trader selects the best quote and executes the trade against the anonymous liquidity provider. The transaction is confirmed through the venue.

- **Post-Trade Reporting** ▴ The trade must be reported publicly. However, because the trade was executed under an LIS waiver, the publication of the trade details can be deferred. This deferral prevents the immediate post-trade price impact that could occur if the market saw a large trade print in real-time. The identities of the counterparties are not part of the public trade report.

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## Quantitative Impact of Anonymity

The primary quantitative benefit of using a waivered RFQ is the reduction of slippage. By preventing information leakage, the initiator can execute the trade closer to the prevailing market price. The following table provides a hypothetical comparison of the execution costs for a large bond trade under different scenarios.

### Table 2 ▴ Hypothetical Slippage Analysis for a €25m Bond Trade

| Execution Method | Pre-Trade Anonymity | Assumed Market Impact (Slippage) | Execution Price (per €100) | Total Cost of Slippage |
| --- | --- | --- | --- | --- |
| Lit Order Book (hypothetical) | Low | 15 bps | €99.85 | €37,500 |
| SI RFQ (Disclosed Counterparty) | Medium | 8 bps | €99.92 | €20,000 |
| Venue RFQ (LIS Waiver) | High | 3 bps | €99.97 | €7,500 |

> The preservation of anonymity through MiFID II waivers directly translates into quantifiable cost savings by mitigating the market impact of large trades.

This analysis demonstrates the tangible financial benefits of the anonymity provided by MiFID II waivers. The ability to execute a large trade without signaling one’s intentions to the market is a significant source of value for institutional investors, and the waiver system provides the necessary regulatory framework to achieve this outcome within a compliant and structured environment.

![A sleek, bimodal digital asset derivatives execution interface, partially open, revealing a dark, secure internal structure. This symbolizes high-fidelity execution and strategic price discovery via institutional RFQ protocols](https://options.greeks.live/wp-content/uploads/2025/08/institutional-digital-asset-derivatives-rfq-protocols-price-discovery.jpg)

## References

- 1. European Securities and Markets Authority. (2022). Q&As on MiFID II and MiFIR transparency topics. ESMA70-872942901-35.

- 2. International Swaps and Derivatives Association. (2021). Review of EU MiFID II/ MiFIR Framework ▴ The pre-trade transparency and Systematic Internalisers regimes for OTC derivatives.

- 3. Allen & Overy. (2017). MiFID II pre and post trade transparency.

- 4. Comisión Nacional del Mercado de Valores. (n.d.). Pre- and post-trading transparency.

- 5. European Securities and Markets Authority. (2016). Waivers from Pre-trade Transparency.

![The image features layered structural elements, representing diverse liquidity pools and market segments within a Principal's operational framework. A sharp, reflective plane intersects, symbolizing high-fidelity execution and price discovery via private quotation protocols for institutional digital asset derivatives, emphasizing atomic settlement nodes](https://options.greeks.live/wp-content/uploads/2025/07/systemic-interplay-for-institutional-digital-asset-derivatives-execution-via-advanced-rfq-protocols.jpg)

## Reflection

![Sleek, modular infrastructure for institutional digital asset derivatives trading. Its intersecting elements symbolize integrated RFQ protocols, facilitating high-fidelity execution and precise price discovery across complex multi-leg spreads](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-execution-system-optimizing-high-fidelity-block-trade-liquidity-and-multi-leg-spread-precision.jpg)

## From Mandated Transparency to Strategic Opacity

The integration of waivers within the MiFID II framework prompts a deeper consideration of the nature of market information. It suggests that not all information is of equal value or utility. While broad pre-trade transparency serves the function of public price discovery, the strategic opacity afforded by waivers serves the function of private liquidity discovery. The existence of these two parallel systems within a single regulatory structure forces market participants to move beyond a simple compliance mindset.

It requires the development of a sophisticated execution strategy that actively assesses the information cost of every trade. The ultimate question for any institution is how to build an operational framework that can intelligently navigate both the light and the shadows of the modern market structure to achieve its specific investment objectives.

![Abstract layers in grey, mint green, and deep blue visualize a Principal's operational framework for institutional digital asset derivatives. The textured grey signifies market microstructure, while the mint green layer with precise slots represents RFQ protocol parameters, enabling high-fidelity execution, private quotation, capital efficiency, and atomic settlement](https://options.greeks.live/wp-content/uploads/2025/07/prime-os-layered-rfq-protocol-for-digital-asset-execution-system.jpg)

## Glossary

<a href="https://prime.greeks.live/area/pre-trade-transparency/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![The image presents a stylized central processing hub with radiating multi-colored panels and blades. This visual metaphor signifies a sophisticated RFQ protocol engine, orchestrating price discovery across diverse liquidity pools](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-execution-and-liquidity-aggregation-hub.jpg)

## Pre-Trade Transparency

Meaning ▴ Pre-Trade Transparency refers to the real-time dissemination of bid and offer prices, along with associated sizes, prior to the execution of a trade. </a><a href="https://prime.greeks.live/area/liquidity-providers/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A marbled sphere symbolizes a complex institutional block trade, resting on segmented platforms representing diverse liquidity pools and execution venues. This visualizes sophisticated RFQ protocols, ensuring high-fidelity execution and optimal price discovery within dynamic market microstructure for digital asset derivatives](https://options.greeks.live/wp-content/uploads/2025/07/principal-rfq-aggregation-digital-asset-derivative-execution-optimization.jpg)

## Liquidity Providers

Meaning ▴ Liquidity Providers are market participants, typically institutional entities or sophisticated trading firms, that facilitate efficient market operations by continuously quoting bid and offer prices for financial instruments. </a><a href="https://prime.greeks.live/area/information-leakage/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A precision metallic mechanism, with a central shaft, multi-pronged component, and blue-tipped element, embodies the market microstructure of an institutional-grade RFQ protocol. It represents high-fidelity execution, liquidity aggregation, and atomic settlement within a Prime RFQ for digital asset derivatives](https://options.greeks.live/wp-content/uploads/2025/08/prime-os-core-rfq-engine-microstructure-for-digital-asset-derivatives.jpg)

## Information Leakage

Meaning ▴ Information leakage denotes the unintended or unauthorized disclosure of sensitive trading data, often concerning an institution's pending orders, strategic positions, or execution intentions, to external market participants. </a><a href="https://prime.greeks.live/area/market-impact/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![An abstract, multi-layered spherical system with a dark central disk and control button. This visualizes a Prime RFQ for institutional digital asset derivatives, embodying an RFQ engine optimizing market microstructure for high-fidelity execution and best execution, ensuring capital efficiency in block trades and atomic settlement](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-execution-engine-prime-os-4.jpg)

## Market Impact

Meaning ▴ Market Impact refers to the observed change in an asset's price resulting from the execution of a trading order, primarily influenced by the order's size relative to available liquidity and prevailing market conditions. </a><a href="https://prime.greeks.live/area/mifid-ii/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Angularly connected segments portray distinct liquidity pools and RFQ protocols. A speckled grey section highlights granular market microstructure and aggregated inquiry complexities for digital asset derivatives](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocol-execution-efficiency.jpg)

## Mifid Ii

Meaning ▴ MiFID II, the Markets in Financial Instruments Directive II, constitutes a comprehensive regulatory framework enacted by the European Union to govern financial markets, investment firms, and trading venues. </a><a href="https://prime.greeks.live/area/rfq-anonymity/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A sophisticated modular component of a Crypto Derivatives OS, featuring an intelligence layer for real-time market microstructure analysis. Its precision engineering facilitates high-fidelity execution of digital asset derivatives via RFQ protocols, ensuring optimal price discovery and capital efficiency for institutional participants](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-engine-module.jpg)

## Rfq Anonymity

Meaning ▴ RFQ Anonymity defines the operational state within a Request for Quote workflow where the identity of the liquidity-seeking Principal remains undisclosed to potential liquidity providers until a predetermined stage of the execution process. </a><a href="https://prime.greeks.live/area/lis/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![An institutional grade system component, featuring a reflective intelligence layer lens, symbolizes high-fidelity execution and market microstructure insight. This enables price discovery for digital asset derivatives](https://options.greeks.live/wp-content/uploads/2025/08/institutional-digital-asset-derivatives-precision-rfq-execution-system-interface.jpg)

## Lis

Meaning ▴ LIS, or Large In Scale, designates an order size that exceeds specific regulatory thresholds, qualifying it for pre-trade transparency waivers on trading venues. </a><a href="https://prime.greeks.live/area/systematic-internaliser/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Abstract spheres and a translucent flow visualize institutional digital asset derivatives market microstructure. It depicts robust RFQ protocol execution, high-fidelity data flow, and seamless liquidity aggregation](https://options.greeks.live/wp-content/uploads/2025/07/precision-market-microstructure-for-institutional-digital-asset-derivatives-leveraging-rfq-protocols-and-atomic-settlement-across-prime-os.jpg)

## Systematic Internaliser

Meaning ▴ A Systematic Internaliser (SI) is a financial institution executing client orders against its own capital on an organized, frequent, systematic basis off-exchange. </a><a href="https://prime.greeks.live/area/si/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A sleek, metallic module with a dark, reflective sphere sits atop a cylindrical base, symbolizing an institutional-grade Crypto Derivatives OS. This system processes aggregated inquiries for RFQ protocols, enabling high-fidelity execution of multi-leg spreads while managing gamma exposure and slippage within dark pools](https://options.greeks.live/wp-content/uploads/2025/07/principal-trading-crypto-derivatives-rfq-protocol-execution-system.jpg)

## Si

Meaning ▴ SI, or Systematic Internaliser, denotes an investment firm that executes client orders against its own proprietary capital, outside the framework of a regulated market or a multilateral trading facility. </a><a href="https://prime.greeks.live/area/lis-waiver/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A central Principal OS hub with four radiating pathways illustrates high-fidelity execution across diverse institutional digital asset derivatives liquidity pools. Glowing lines signify low latency RFQ protocol routing for optimal price discovery, navigating market microstructure for multi-leg spread strategies](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocol-execution-intelligence.jpg)

## Lis Waiver

Meaning ▴ The LIS Waiver, or Large In-Size Waiver, constitutes a regulatory provision permitting the non-publication of pre-trade quotes for orders exceeding a specific volume threshold in certain financial markets. </a><a href="https://prime.greeks.live/area/best-execution/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Prime RFQ visualizes institutional digital asset derivatives RFQ protocol and high-fidelity execution. Glowing liquidity streams converge at intelligent routing nodes, aggregating market microstructure for atomic settlement, mitigating counterparty risk within dark liquidity](https://options.greeks.live/wp-content/uploads/2025/08/prime-os-high-fidelity-digital-asset-derivatives-rfq-protocol.jpg)

## Best Execution

Meaning ▴ Best Execution is the obligation to obtain the most favorable terms reasonably available for a client's order. </a><a href="https://prime.greeks.live/area/otf/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A precise mechanical instrument with intersecting transparent and opaque hands, representing the intricate market microstructure of institutional digital asset derivatives. This visual metaphor highlights dynamic price discovery and bid-ask spread dynamics within RFQ protocols, emphasizing high-fidelity execution and latent liquidity through a robust Prime RFQ for atomic settlement](https://options.greeks.live/wp-content/uploads/2025/07/precision-engineering-driving-institutional-digital-asset-derivatives-execution-across-advanced-rfq-protocols-and-prime-brokerage-frameworks.jpg)

## Otf

Meaning ▴ On-The-Fly (OTF) designates a computational methodology where data processing, calculation, or generation occurs instantaneously at the moment of demand or event trigger, without reliance on pre-computed results or persistent storage. </a>

**Tags:** [SI](https://options.greeks.live/area/si/), [Organised Trading Facility](https://options.greeks.live/area/organised-trading-facility/), [Large in Scale Waiver](https://options.greeks.live/area/large-in-scale-waiver/), [Pre-Trade Transparency](https://options.greeks.live/area/pre-trade-transparency/), [Market Impact](https://options.greeks.live/area/market-impact/), [Information Leakage](https://options.greeks.live/area/information-leakage/)	

## Discover More

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### [Can Regulatory Changes regarding Pre-Trade Transparency Eliminate the Need for Anonymous RFQ Protocols?](https://options.greeks.live/question/can-regulatory-changes-regarding-pre-trade-transparency-eliminate-the-need-for-anonymous-rfq-protocols/)
![A precision-engineered, multi-layered system architecture for institutional digital asset derivatives. Its modular components signify robust RFQ protocol integration, facilitating efficient price discovery and high-fidelity execution for complex multi-leg spreads, minimizing slippage and adverse selection in market microstructure.](https://options.greeks.live/wp-content/uploads/2025/07/prime-os-institutional-digital-asset-derivatives-rfq-execution-platform.jpg)

Regulatory mandates on transparency re-calibrate market structure but cannot erase the fundamental need for anonymous protocols to manage large-scale execution risk.

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### [What Are the Regulatory Considerations When Choosing between RFQ and CLOB for Derivatives Trading?](https://options.greeks.live/question/what-are-the-regulatory-considerations-when-choosing-between-rfq-and-clob-for-derivatives-trading/)
![An abstract institutional-grade RFQ protocol market microstructure visualization. Distinct execution streams intersect on a capital efficiency pivot, symbolizing block trade price discovery within a Prime RFQ. Adjacent liquidity pools and digital asset derivatives underscore high-fidelity execution.](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-optimized-microstructure.jpg)

The choice between RFQ and CLOB is a strategic balancing of transparency mandates against market impact mitigation.

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### [Does MiFID II’s Transparency Mandate Fundamentally Reduce the Value of RFQ for Large Block Trades?](https://options.greeks.live/question/does-mifid-iis-transparency-mandate-fundamentally-reduce-the-value-of-rfq-for-large-block-trades/)
![Central nexus with radiating arms symbolizes a Principal's sophisticated Execution Management System EMS. Segmented areas depict diverse liquidity pools and dark pools, enabling precise price discovery for digital asset derivatives. Circular markers denote RFQ participants, ensuring high-fidelity execution of institutional block trades within complex market microstructure.](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-prime-os-rfq-liquidity-orchestration.jpg)

MiFID II re-architects RFQ's value from pure discretion to a protocol for navigating calibrated transparency and accessing segmented liquidity.

- 
### [How Does the MiFID II Regulatory Framework Impact Block Trading via RFQ Protocols?](https://options.greeks.live/question/how-does-the-mifid-ii-regulatory-framework-impact-block-trading-via-rfq-protocols/)
![Interlocking transparent and opaque geometric planes on a dark surface. This abstract form visually articulates the intricate Market Microstructure of Institutional Digital Asset Derivatives, embodying High-Fidelity Execution through advanced RFQ protocols. It symbolizes Aggregated Inquiry, optimal Liquidity Pool access, and Atomic Settlement within a Principal OS.](https://options.greeks.live/wp-content/uploads/2025/07/geometric-abstraction-of-institutional-digital-asset-derivatives-market-microstructure-driving-high-fidelity-execution-via-principal-rfq-protocols-and-optimal-liquidity-aggregation.jpg)

MiFID II reshaped block trading by mandating auditable, electronic RFQ workflows to access fragmented liquidity in a compliant manner.

- 
### [How Does MiFID II Influence the Choice between RFQ and SI Venues?](https://options.greeks.live/question/how-does-mifid-ii-influence-the-choice-between-rfq-and-si-venues/)
![Abstract structure combines opaque curved components with translucent blue blades, a Prime RFQ for institutional digital asset derivatives. It represents market microstructure optimization, high-fidelity execution of multi-leg spreads via RFQ protocols, ensuring best execution and capital efficiency across liquidity pools.](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocol-optimizing-market-microstructure-for-high-fidelity-execution-best-execution-price-discovery-across-liquidity-pools-and-prime-os.jpg)

MiFID II mandates a data-driven choice between SI immediacy and RFQ price discovery to prove best execution.

- 
### [How Does the LIS Waiver Directly Influence RFQ Counterparty Selection?](https://options.greeks.live/question/how-does-the-lis-waiver-directly-influence-rfq-counterparty-selection/)
![A sophisticated, layered circular interface with intersecting pointers symbolizes institutional digital asset derivatives trading. It represents the intricate market microstructure, real-time price discovery via RFQ protocols, and high-fidelity execution. The design evokes quantitative analysis, smart order routing, and the intelligence layer of a Prime RFQ for capital efficiency.](https://options.greeks.live/wp-content/uploads/2025/07/prime-os-institutional-digital-asset-derivatives-rfq-market-microstructure.jpg)

The LIS waiver reshapes RFQ counterparty selection by prioritizing trusted, discreet liquidity providers to minimize market impact for large trades.

- 
### [What Is the Large-In-Scale Waiver under MiFID II Regulations?](https://options.greeks.live/question/what-is-the-large-in-scale-waiver-under-mifid-ii-regulations/)
![A conceptual image illustrates a sophisticated RFQ protocol engine, depicting the market microstructure of institutional digital asset derivatives. Two semi-spheres, one light grey and one teal, represent distinct liquidity pools or counterparties within a Prime RFQ, connected by a complex execution management system for high-fidelity execution and atomic settlement of Bitcoin options or Ethereum futures.](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-market-microstructure-2.jpg)

The Large-in-Scale waiver is a MiFID II provision permitting large orders to bypass pre-trade transparency, minimizing market impact.

- 
### [How Do Large in Scale Waivers under MiFID II Impact RFQ Execution Strategy for Block Trades?](https://options.greeks.live/question/how-do-large-in-scale-waivers-under-mifid-ii-impact-rfq-execution-strategy-for-block-trades/)
![Clear geometric prisms and flat planes interlock, symbolizing complex market microstructure and multi-leg spread strategies in institutional digital asset derivatives. A solid teal circle represents a discrete liquidity pool for private quotation via RFQ protocols, ensuring high-fidelity execution.](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocols-price-discovery-and-high-fidelity-execution.jpg)

LIS waivers under MiFID II enable discreet, large-scale liquidity sourcing via RFQ protocols, minimizing market impact for block trades.

- 
### [How Do Regulatory Frameworks like MiFID II Impact the Curation of RFQ Environments and the Prevention of Adverse Selection?](https://options.greeks.live/question/how-do-regulatory-frameworks-like-mifid-ii-impact-the-curation-of-rfq-environments-and-the-prevention-of-adverse-selection/)
![A beige, triangular device with a dark, reflective display and dual front apertures. This specialized hardware facilitates institutional RFQ protocols for digital asset derivatives, enabling high-fidelity execution, market microstructure analysis, optimal price discovery, capital efficiency, block trades, and portfolio margin.](https://options.greeks.live/wp-content/uploads/2025/08/institutional-digital-asset-derivatives-rfq-terminal-for-high-fidelity-execution-and-precise-market-microstructure-analysis.jpg)

MiFID II transforms RFQ from a private negotiation into a data-driven, auditable process to mitigate adverse selection through transparency.

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---

**Original URL:** https://options.greeks.live/question/how-do-mifid-ii-waivers-impact-rfq-anonymity/
