# What Are the Primary Obligations of a Firm Registered as a Systematic Internaliser? ▴ Question

**Published:** 2025-08-14
**Categories:** Question

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## Concept

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## The Systemic Fulcrum of Bilateral Liquidity

A [Systematic Internaliser](https://prime.greeks.live/area/systematic-internaliser/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) (SI) represents a specific and highly regulated node within the European financial market’s architecture, codified under the Markets in [Financial Instruments](https://prime.greeks.live/question/can-an-otf-operator-legally-use-matched-principal-trading-for-all-types-of-financial-instruments/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) Directive II (MiFID II). It is an investment firm that engages in dealing on its own account by executing client orders outside of traditional trading venues like regulated markets or Multilateral Trading Facilities (MTFs). This activity is performed on an organized, frequent, systematic, and substantial basis, transforming what would otherwise be opaque over-the-counter (OTC) activity into a transparent, structured liquidity source. The regime’s purpose is to bring a significant portion of bilateral trading into the regulatory perimeter, ensuring that the internalization of order flow does not degrade the broader market’s price discovery process.

The genesis of the SI framework lies in the regulatory objective to enhance market transparency across all [asset classes](https://prime.greeks.live/question/how-does-pre-trade-risk-assessment-differ-between-liquid-and-illiquid-asset-classes/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite), extending beyond the equities focus of its predecessor, MiFID I. For asset classes like bonds, derivatives, and structured finance products, where a substantial volume of trading occurs bilaterally, the SI regime imposes obligations that mimic certain functions of a public exchange. It compels major liquidity providers, typically large investment banks and proprietary trading firms, to formalize their role as market makers for specific instruments once their [trading activity](https://prime.greeks.live/question/what-are-the-operational-challenges-when-reconciling-pre-allocated-capital-with-real-time-trading-activity/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) crosses prescribed quantitative thresholds. This formalization carries a precise set of duties designed to balance the benefits of internalized execution with the systemic need for transparent pricing information, thereby creating a level playing field with organized trading venues.

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## Defining the Operational Thresholds

An investment firm does not arbitrarily choose to become a Systematic Internaliser; the status is mandated once its trading activity in a specific financial instrument surpasses quantitative benchmarks set by European regulators. This determination is made through a rigorous, data-driven assessment performed quarterly. The criteria are designed to identify firms whose principal trading activity is significant enough to impact market-wide price formation. The assessment hinges on two primary calculations for each class of financial instrument:

- **The Frequent and Systematic Test** ▴ This measures the frequency of the firm’s [OTC trading](https://prime.greeks.live/area/otc-trading/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) activity on its own account. For equities and similar instruments, this is a pure trade count calculation. For other asset classes like derivatives, it involves assessing the number of OTC transactions relative to the firm’s total transactions in that asset class.

- **The [Substantial Basis Test](https://prime.greeks.live/area/substantial-basis-test/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite)** ▴ This evaluates the size of the firm’s OTC trading relative to the total [trading volume](https://prime.greeks.live/question/did-the-double-volume-caps-succeed-in-moving-trading-volume-to-lit-markets/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) in that instrument across the European Union. The firm’s principal trading volume in an instrument (the numerator) is compared against the total EU-wide trading volume for that same instrument (the denominator).

Once a firm crosses these thresholds for a given instrument, it is obligated to notify its national competent authority (NCA), such as BaFin in Germany or the AMF in France. The NCA then forwards this information to the European Securities and Markets Authority ([ESMA](https://prime.greeks.live/area/esma/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite)), which maintains a public register of all SIs and the specific instruments for which they hold this status. This public declaration is a critical component of the regulatory framework, providing market-wide visibility into which firms are bound by SI obligations for which products. The requirement to continuously monitor and report this status ensures that the regulatory net adapts to shifts in trading activity, capturing firms as their market footprint grows.

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## A Hybrid Role in Market Structure

The Systematic Internaliser occupies a unique position in the financial ecosystem. It is fundamentally a bilateral, principal-dealing entity, yet it is encumbered with public-facing transparency obligations typically associated with multilateral venues. An SI is not a neutral marketplace; it is a counterparty, using its own capital to complete trades with its clients.

However, unlike a purely OTC counterparty, its quoting and reporting behavior is strictly prescribed by regulation. This hybrid nature serves a distinct systemic purpose ▴ it allows for the continued existence of principal-based liquidity provision, which is vital for large or complex trades, while mitigating the information asymmetry and opacity that can harm overall market quality.

> The SI framework integrates principal liquidity providers into the regulated transparency fabric, ensuring their substantial trading activity contributes to, rather than detracts from, public price discovery.

This structure creates a controlled environment for off-venue trading. Clients who transact with an SI benefit from a direct source of liquidity, but the market as a whole benefits from the pre-trade and post-trade data that the SI is obligated to publish. This regulatory design acknowledges the value of internalized execution while preventing the formation of a completely dark market that could siphon liquidity and degrade the [price discovery](https://prime.greeks.live/question/could-a-different-market-structure-achieve-both-price-improvement-and-efficient-price-discovery-simultaneously/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) function of lit exchanges. The SI, therefore, functions as a regulated gateway between private liquidity pools and public market transparency.

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## Strategy

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## The Core Obligations a Framework of Transparency

The primary obligations of a Systematic Internaliser revolve around two central pillars ▴ [pre-trade transparency](https://prime.greeks.live/area/pre-trade-transparency/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) and [post-trade transparency](https://prime.greeks.live/area/post-trade-transparency/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite). These duties are the strategic core of the SI regime, compelling firms to expose their pricing and trading activity to the market in a structured and timely manner. The specific requirements vary based on the asset class and the liquidity of the instrument in question, creating a tiered system of compliance.

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## Pre-Trade Transparency the Quoting Mandate

The most significant duty for an SI is the obligation to provide firm quotes, which demonstrates a willingness to trade at the prices displayed. For liquid equity and equity-like instruments, an SI must make public firm quotes for trades up to a “[standard market size](https://prime.greeks.live/area/standard-market-size/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite).” This means the SI must display bid and ask prices at which it is prepared to trade. For less liquid instruments or for trades above the [standard market](https://prime.greeks.live/question/how-does-the-daubert-standard-differ-from-the-frye-standard-in-practice/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) size, the obligation is softened; the SI must disclose quotes to its clients upon request.

For non-equity instruments like bonds and derivatives, the pre-trade transparency obligation is triggered when a client requests a quote and the SI agrees to provide one. In such cases, the quote must be made public to all of the SI’s clients, though the SI can tailor which clients it provides quotes to based on objective, non-discriminatory commercial policies. This ensures that while the SI retains control over its client relationships, it cannot selectively provide pricing information in a way that would create an unfair advantage. The quotes must be published through an [Approved Publication Arrangement](https://prime.greeks.live/area/approved-publication-arrangement/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) (APA), ensuring the data is disseminated widely and efficiently.

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## Post-Trade Transparency the Reporting Imperative

Post-trade transparency is a universal obligation for SIs across all asset classes. The SI is responsible for making the details of its transactions public. This reporting duty is a critical mechanism for market oversight and price discovery, as it provides a consolidated view of trading activity that occurs off-venue.

When an SI executes a trade, it must report the price, volume, and time of the transaction to an APA. This information is then made available to the public, typically with a short delay.

A key strategic element of the [post-trade reporting](https://prime.greeks.live/question/what-are-the-key-differences-in-reporting-requirements-between-public-post-trade-transparency-and-regulatory-transaction-reporting-for-lis-orders/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) framework is the allocation of responsibility. In a transaction involving an SI, the reporting obligation always falls on the SI, regardless of whether it is the buyer or the seller. The SI must inform its counterparty that it is handling the reporting to prevent duplicate reports.

This has become a significant operational advantage for buy-side firms, who can effectively delegate their post-[trade reporting](https://prime.greeks.live/question/what-are-the-key-differences-in-reporting-requirements-between-public-post-trade-transparency-and-regulatory-transaction-reporting-for-lis-orders/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) requirements by trading with an SI. This operational simplification has made transacting with SIs an attractive proposition for many market participants, positioning the SI not just as a liquidity provider but also as a service provider for [regulatory reporting](https://prime.greeks.live/area/regulatory-reporting/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite).

> By centralizing the reporting duty, the SI regime streamlines post-trade data flows and reduces the operational burden on other market participants.

The table below outlines the primary obligations for an SI, differentiating between asset classes and liquidity profiles.

| Obligation | Liquid Equities & Equity-Like | Illiquid Equities / Large-in-Scale | Liquid Non-Equities (Bonds, Derivatives) | Illiquid Non-Equities / Large-in-Scale |
| --- | --- | --- | --- | --- |
| Pre-Trade Quoting | Mandatory public firm quotes up to standard market size. | Quotes must be provided to clients upon request. | Firm quotes must be made public to clients when a quote is requested and the SI agrees to provide it. | Waivers may apply; quotes are generally provided upon request. |
| Post-Trade Reporting | SI is responsible for public trade reporting via an APA. | SI is responsible for public trade reporting via an APA, though deferrals may apply. | SI is responsible for public trade reporting via an APA. | SI is responsible for public trade reporting via an APA, with potential for volume omission and extended deferrals. |

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## Best Execution and Commercial Policy

Beyond transparency, SIs are bound by the overarching [MiFID II](https://prime.greeks.live/area/mifid-ii/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) [best execution](https://prime.greeks.live/area/best-execution/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) requirements. When executing client orders, they must take all sufficient steps to obtain the best possible result for their clients, considering factors like price, cost, speed, and likelihood of execution and settlement. This obligation ensures that the internalization of order flow does not come at the expense of execution quality for the end client.

Furthermore, while an SI can decide which clients to grant access to its quotes, this decision must be based on a clear, objective, and non-discriminatory [commercial policy](https://prime.greeks.live/question/how-do-systematic-internalisers-use-commercial-policy-to-manage-rfq-flow/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite). For example, an SI might establish different client categories based on creditworthiness or trading sophistication. This prevents SIs from unfairly discriminating between clients of a similar profile. The policy must be transparent and consistently applied, forming another layer of regulatory oversight on how SIs manage their client relationships and distribute their liquidity.

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## Execution

![A precisely engineered multi-component structure, split to reveal its granular core, symbolizes the complex market microstructure of institutional digital asset derivatives. This visual metaphor represents the unbundling of multi-leg spreads, facilitating transparent price discovery and high-fidelity execution via RFQ protocols within a Principal's operational framework](https://options.greeks.live/wp-content/uploads/2025/07/institutional-grade-digital-asset-derivatives-rfq-protocols-revealing-market-microstructure-for-high-fidelity-execution-and-atomic-settlement-within-principals-operational-framework.jpg)

## The Operational Playbook

Establishing and maintaining a compliant Systematic Internaliser function is a significant operational undertaking. It requires a sophisticated technological and procedural architecture capable of handling high-volume data processing, real-time decision-making, and regulatory reporting with precision. The following playbook outlines the critical steps and systems required for a firm to meet its SI obligations effectively.

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## Step 1 SI Determination and Registration

- **Data Aggregation** ▴ The first operational challenge is to aggregate all own-account trading data across every financial instrument. This system must capture every transaction executed outside a regulated market, MTF, or OTF.

- **Threshold Calculation Engine** ▴ A robust calculation engine is required to perform the quarterly SI tests. This engine must ingest the firm’s trading data and the official EU-wide trading data published by ESMA to accurately calculate the firm’s market share and transaction frequency for thousands of instruments.

- **Automated Monitoring and Alerting** ▴ The process should be automated to run at the end of each assessment period. The system must generate alerts for any instrument approaching or breaching the SI thresholds, flagging them for review by the compliance team.

- **Regulatory Notification Workflow** ▴ Once an instrument breaches a threshold, a formal workflow must be initiated to notify the relevant National Competent Authority (NCA). This process must be logged and auditable.

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## Step 2 Pre-Trade Quoting Infrastructure

- **Quote Generation and Management** ▴ The firm’s pricing engines must be integrated with a quote management system. This system must be capable of generating two-way quotes for all instruments where the firm is an SI and there is a liquid market.

- **Client Access Control** ▴ The system must enforce the firm’s commercial policy, controlling which clients can view and interact with which quotes. This requires a sophisticated client relationship management (CRM) integration.

- **Dissemination to an APA** ▴ A real-time, low-latency connection to one or more Approved Publication Arrangements (APAs) is essential. The quoting system must format the quotes according to the APA’s specifications and publish them instantaneously.

- **Quote Firmness Logic** ▴ The trading systems must be configured to honor the published quotes for trades up to the standard market size. This requires tight integration between the quoting engine and the execution management system (EMS) to prevent stale quotes and ensure compliance.

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## Step 3 Post-Trade Reporting and Transaction Reporting

- **Trade Capture and Enrichment** ▴ All executed trades must be captured in real-time. The system must enrich the trade data with all required regulatory fields, including timestamps, instrument identifiers (ISINs), and counterparty identifiers (LEIs).

- **Reporting Responsibility Logic** ▴ The system must automatically identify trades where the firm has the post-trade reporting obligation (i.e. any trade where the firm is the SI). It must also flag the need to inform the counterparty that reporting is being handled.

- **Connection to APA/ARM** ▴ The firm needs a resilient connection to an APA for public post-trade reporting and an Approved Reporting Mechanism (ARM) for transaction reporting to regulators. The system must be capable of submitting reports within the prescribed timeframes (e.g. near real-time for post-trade reports).

- **Error Handling and Reconciliation** ▴ A robust reconciliation process is needed to match submitted reports with internal trade records and to handle any rejections or queries from the APA/ARM or regulators.

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## Quantitative Modeling and Data Analysis

The determination of SI status is a purely quantitative exercise. A firm must model its trading data against the market to understand its obligations. Consider a hypothetical firm, “Delta One Trading,” assessing its status for a specific class of derivatives ▴ let’s say, options on the Euro Stoxx 50 index (ISIN ▴ EU0009658145).

The firm must perform two tests based on data from the preceding six months. The assessment period is quarterly.

**Test 1 ▴ Frequent and Systematic Basis** For derivatives, this is met if the firm carries out, on average, at least one OTC transaction per week in that specific class of derivatives.

**Test 2 ▴ [Substantial Basis](https://prime.greeks.live/news/bitcoin-and-ethereum-etfs-see-substantial-capital-outflows/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite)** This test compares the firm’s own-account OTC trading volume to the total EU trading volume in that instrument. The threshold is met if the firm’s trading represents at least 1% of the total EU volume.

The table below provides a hypothetical data set for Delta One Trading’s Q3 2025 assessment (covering trading from March 1, 2025, to August 31, 2025).

| Metric | Value | Source | Comment |
| --- | --- | --- | --- |
| Assessment Period | 01/03/2025 – 31/08/2025 | MiFID II RTS 1 | 6-month lookback period. |
| Instrument Class | Options on Euro Stoxx 50 | Internal Classification | Firm must classify all trades. |
| Total Weeks in Period | 26 | Calculation | |
| Delta One’s OTC Trades | 55 | Internal Trade Log | Number of principal OTC trades. |
| Average Weekly OTC Trades | 2.12 (55 / 26) | Calculation | Result ▴ Threshold Met (>= 1) |
| Delta One’s OTC Volume (EUR) | €1,250,000,000 | Internal Trade Log | Numerator for substantial basis test. |
| Total EU Volume (EUR) | €95,000,000,000 | ESMA FIRDS Database | Denominator for substantial basis test. |
| Delta One’s Market Share | 1.32% | Calculation | Result ▴ Threshold Met (>= 1%) |

Since both thresholds are met, Delta One Trading is obligated to register as a Systematic Internaliser for this class of derivatives. Their compliance function would then trigger the notification workflow, and their trading and technology teams would ensure the quoting and reporting systems are configured for these instruments by the start of the next quarter.

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## Predictive Scenario Analysis

Let us consider a detailed scenario involving a mid-sized asset manager, “Bedrock Capital,” and a large investment bank, “Global Markets Bank” (GMB), which is a registered SI for single-name equity options. Bedrock needs to execute a large, complex options strategy on the fictional company “Innovate Corp” (ticker ▴ INVC). The strategy is a risk reversal, involving the sale of a put option and the purchase of a call option, designed to take a bullish stance with reduced premium outlay. The total size of the transaction is significantly above the standard market size.

On August 14, 2025, at 10:30 AM UTC, a portfolio manager at Bedrock Capital initiates a Request for Quote (RFQ) through their EMS to GMB for the INVC options strategy. The RFQ specifies the sale of 5,000 contracts of the INVC Dec-2025 €90 Put and the purchase of 5,000 contracts of the INVC Dec-2025 €110 Call. Because GMB is an SI for these instruments, a specific set of obligations is triggered. GMB’s automated quoting system receives the RFQ.

Since the trade is above the standard market size, GMB is not obligated to provide a public quote. However, their commercial policy dictates that they provide quotes for such requests to established clients like Bedrock. Their pricing engine calculates a net price for the spread based on their internal volatility models and current market data, arriving at a net credit of €2.50 per share for the package.

At 10:31 AM UTC, GMB responds to the RFQ directly to Bedrock Capital’s EMS with the firm quote of €2.50 credit. GMB is not required to make this specific quote public because it is above the [large-in-scale](https://prime.greeks.live/area/large-in-scale/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) threshold. Bedrock’s trader reviews the quote, finds it favorable compared to their internal benchmarks, and accepts the trade via their EMS at 10:32 AM UTC. The trade is executed.

Immediately, GMB’s systems spring into action to fulfill their post-trade obligations. The trade is captured by GMB’s middle-office system. The system enriches the trade record with all necessary data ▴ LEIs for both parties, the ISINs for both options legs, the exact execution timestamp (2025-08-14T10:32:01.123Z), the price, and the notional value. The system identifies that GMB is the SI and therefore has the reporting responsibility. An automated message is sent to Bedrock’s system confirming the trade details and explicitly stating, “GMB will perform post-trade reporting for this transaction.” This absolves Bedrock of their reporting duty.

Within seconds, GMB’s reporting engine formats a post-trade report for the APA. Because the trade is large-in-scale, GMB is entitled to a deferred publication. The report is sent to the APA with a flag indicating a deferral period of 60 minutes. The report will be made public by the APA at 11:32 AM UTC.

Furthermore, GMB’s transaction reporting system prepares a separate, more detailed report for the regulator. This report, which includes the identity of the client (Bedrock Capital), is scheduled for submission to their ARM well within the T+1 deadline. This scenario illustrates the seamless integration of commercial activity and regulatory compliance within an SI’s operational framework. The system handles quoting, execution, and multi-layered reporting obligations automatically, allowing the firm to provide valuable liquidity while adhering to the complex transparency requirements of MiFID II.

> An SI’s operational architecture must seamlessly translate a client’s execution request into a fully compliant, multi-channel reporting outcome.

![An advanced digital asset derivatives system features a central liquidity pool aperture, integrated with a high-fidelity execution engine. This Prime RFQ architecture supports RFQ protocols, enabling block trade processing and price discovery](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-rfq-protocol-execution-system-architecture.jpg)

## System Integration and Technological Architecture

The technological backbone of a Systematic Internaliser is a complex, integrated system designed for high performance, reliability, and regulatory compliance. It is an ecosystem of interconnected components that must work in concert to meet the firm’s obligations.

- **Order and Execution Management Systems (OMS/EMS)** ▴ These are the primary interfaces for client interaction. The EMS must be capable of handling RFQs and providing direct execution against the SI’s quotes. The OMS must accurately capture all order and trade details for downstream processing.

- **Pricing and Quoting Engines** ▴ These are sophisticated, low-latency systems that consume real-time market data to generate bid and ask prices. For an SI, these engines must be connected to a dissemination module that can publish quotes to an APA in the required format, often using the [Financial Information eXchange](https://prime.greeks.live/area/financial-information-exchange/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite) (FIX) protocol. Specific FIX tags are used to denote quote status (firm, indicative) and other required information.

- **Regulatory Reporting Hub** ▴ This is the central component for compliance. The hub ingests trade data from the OMS/EMS, enriches it with reference data (like ISINs and LEIs), applies the logic to determine reporting obligations, and formats the messages for the appropriate destination (APA or ARM). It must manage different reporting timelines (real-time vs. T+1) and handle acknowledgments and rejections.

- **Data Management and Analytics** ▴ A robust data warehouse is required to store all trading and reporting data for audit purposes (typically for a minimum of five years). This data is also used for the quarterly SI threshold calculations and for generating best execution reports (e.g. RTS 27 reports on execution quality).

The integration between these systems is critical. A trade executed in the EMS must flow seamlessly to the OMS, then to the reporting hub, without manual intervention. The entire architecture must be synchronized with a highly accurate time source (traceable to UTC) to meet the timestamping requirements of MiFID II. This technological framework represents a substantial investment, forming a high barrier to entry and solidifying the role of large, technologically advanced firms as the primary providers of SI liquidity.

![A sleek, light-colored, egg-shaped component precisely connects to a darker, ergonomic base, signifying high-fidelity integration. This modular design embodies an institutional-grade Crypto Derivatives OS, optimizing RFQ protocols for atomic settlement and best execution within a robust Principal's operational framework, enhancing market microstructure](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-engine-core-principal-system.jpg)

## References

- European Securities and Markets Authority. (2017). “MiFID II and MiFIR ▴ Investor Protection and Intermediaries.” ESMA/2017/1234.

- BaFin – Federal Financial Supervisory Authority. (2017). “Systematic Internalisers ▴ Main points of the new supervisory regime under MiFID II.” BaFin Journal, May 2017.

- European Parliament and Council. (2014). “Directive 2014/65/EU on markets in financial instruments (MiFID II).” Official Journal of the European Union, L 173/349.

- European Parliament and Council. (2014). “Regulation (EU) No 600/2014 on markets in financial instruments (MiFIR).” Official Journal of the European Union, L 173/84.

- Harris, L. (2003). “Trading and Exchanges ▴ Market Microstructure for Practitioners.” Oxford University Press.

- Lehalle, C. A. & Laruelle, S. (2013). “Market Microstructure in Practice.” World Scientific Publishing.

- Financial Conduct Authority. (2017). “MiFID II ▴ Systematic Internalisers.” FCA Handbook, Markets in Financial Instruments Instrument 2017.

- International Capital Market Association. (2018). “MiFID II and the Systematic Internaliser regime for bonds.” ICMA Report.

![Abstractly depicting an Institutional Grade Crypto Derivatives OS component. Its robust structure and metallic interface signify precise Market Microstructure for High-Fidelity Execution of RFQ Protocol and Block Trade orders](https://options.greeks.live/wp-content/uploads/2025/07/principals-integrated-crypto-derivatives-rfq-protocol-architecture.jpg)

## Reflection

![A modular system with beige and mint green components connected by a central blue cross-shaped element, illustrating an institutional-grade RFQ execution engine. This sophisticated architecture facilitates high-fidelity execution, enabling efficient price discovery for multi-leg spreads and optimizing capital efficiency within a Prime RFQ framework for digital asset derivatives](https://options.greeks.live/wp-content/uploads/2025/07/principal-prime-os-rfq-engine-for-digital-asset-derivatives.jpg)

## The Calibrated Node in Market Transparency

Understanding the obligations of a Systematic Internaliser moves beyond a simple compliance checklist. It requires a deep appreciation for the role this entity plays within the broader system of market information. The SI framework is a deliberate piece of regulatory engineering designed to manage the inherent tension between bilateral liquidity and multilateral transparency.

It formalizes the function of major dealers, converting their significant economic presence into a structured and predictable source of market data. For a firm, operating as an SI is an acceptance of this systemic responsibility.

The operational architecture required to fulfill these duties ▴ the real-time quoting engines, the reporting hubs, the data analytics platforms ▴ is a tangible manifestation of this responsibility. It is a system built not just for trading, but for transparency. As markets continue to evolve, driven by technology and regulation, the principles embodied by the SI regime will likely become even more embedded in the fabric of finance. The core challenge for any major market participant is to assess how their own operational framework interacts with these regulated nodes of liquidity and information, and to position their own systems to achieve the highest levels of efficiency and execution quality within this calibrated, transparent landscape.

![Intricate mechanisms represent a Principal's operational framework, showcasing market microstructure of a Crypto Derivatives OS. Transparent elements signify real-time price discovery and high-fidelity execution, facilitating robust RFQ protocols for institutional digital asset derivatives and options trading](https://options.greeks.live/wp-content/uploads/2025/07/principal-rfq-protocol-engine-for-institutional-digital-asset-derivatives.jpg)

## Glossary

<a href="https://prime.greeks.live/area/systematic-internaliser/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Symmetrical, institutional-grade Prime RFQ component for digital asset derivatives. Metallic segments signify interconnected liquidity pools and precise price discovery](https://options.greeks.live/wp-content/uploads/2025/07/principals-prime-os-for-digital-asset-derivatives-rfq-execution.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/question/can-an-otf-operator-legally-use-matched-principal-trading-for-all-types-of-financial-instruments/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Sleek metallic structures with glowing apertures symbolize institutional RFQ protocols. These represent high-fidelity execution and price discovery across aggregated liquidity pools](https://options.greeks.live/wp-content/uploads/2025/07/precision-digital-asset-derivatives-trading-systems-optimizing-rfq-protocols-for-institutional-block-trade-execution.jpg)

## Financial Instruments

An OTF operator's use of matched principal trading is a limited, strategic capability for specific non-equity instruments only. </a><a href="https://prime.greeks.live/question/what-are-the-operational-challenges-when-reconciling-pre-allocated-capital-with-real-time-trading-activity/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A central glowing blue mechanism with a precision reticle is encased by dark metallic panels. This symbolizes an institutional-grade Principal's operational framework for high-fidelity execution of digital asset derivatives](https://options.greeks.live/wp-content/uploads/2025/07/precision-core-enabling-institutional-digital-asset-derivatives-rfq-execution.jpg)

## Trading Activity

Reconciling static capital with real-time trading requires a unified, low-latency system for continuous risk and liquidity assessment. </a><a href="https://prime.greeks.live/question/how-does-pre-trade-risk-assessment-differ-between-liquid-and-illiquid-asset-classes/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A glossy, segmented sphere with a luminous blue 'X' core represents a Principal's Prime RFQ. It highlights multi-dealer RFQ protocols, high-fidelity execution, and atomic settlement for institutional digital asset derivatives, signifying unified liquidity pools, market microstructure, and capital efficiency](https://options.greeks.live/wp-content/uploads/2025/08/prime-os-core-for-best-rfq-digital-asset-derivatives-institutional-trade-flow.jpg)

## Asset Classes

Pre-trade risk architecture adapts from a real-time, algorithmic gateway for liquid assets to a multi-stage investigative workflow for illiquid ones. </a><a href="https://prime.greeks.live/area/otc-trading/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Precision metallic component, possibly a lens, integral to an institutional grade Prime RFQ. Its layered structure signifies market microstructure and order book dynamics](https://options.greeks.live/wp-content/uploads/2025/08/high-fidelity-institutional-digital-asset-rfq-execution-engine.jpg)

## Otc Trading

Meaning ▴ OTC Trading, or Over-The-Counter Trading, defines the bilateral execution of financial instruments, including institutional digital asset derivatives, directly between two counterparties without the intermediation of a centralized exchange or public order book. </a><a href="https://prime.greeks.live/area/substantial-basis-test/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A precision-engineered blue mechanism, symbolizing a high-fidelity execution engine, emerges from a rounded, light-colored liquidity pool component, encased within a sleek teal institutional-grade shell. This represents a Principal's operational framework for digital asset derivatives, demonstrating algorithmic trading logic and smart order routing for block trades via RFQ protocols, ensuring atomic settlement](https://options.greeks.live/wp-content/uploads/2025/07/institutional-crypto-derivatives-os-core-algorithmic-execution-engine.jpg)

## Substantial Basis Test

Meaning ▴ The Substantial Basis Test defines the requisite evidential threshold and logical coherence required to validate a financial claim, model, or strategic decision within a regulated institutional context. </a><a href="https://prime.greeks.live/question/did-the-double-volume-caps-succeed-in-moving-trading-volume-to-lit-markets/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A central reflective sphere, representing a Principal's algorithmic trading core, rests within a luminous liquidity pool, intersected by a precise execution bar. This visualizes price discovery for digital asset derivatives via RFQ protocols, reflecting market microstructure optimization within an institutional grade Prime RFQ](https://options.greeks.live/wp-content/uploads/2025/07/principal-rfq-engine-for-digital-asset-derivatives-best-execution.jpg)

## Trading Volume

The Double Volume Caps succeeded in shifting volume from dark pools to lit markets and SIs, altering market structure without fully achieving a transparent marketplace. </a><a href="https://prime.greeks.live/area/esma/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![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)

## Esma

Meaning ▴ ESMA, the European Securities and Markets Authority, functions as an independent European Union agency responsible for safeguarding the stability of the EU's financial system by ensuring the integrity, transparency, efficiency, and orderly functioning of securities markets, alongside enhancing investor protection. </a><a href="https://prime.greeks.live/question/could-a-different-market-structure-achieve-both-price-improvement-and-efficient-price-discovery-simultaneously/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A dark, reflective surface displays a luminous green line, symbolizing a high-fidelity RFQ protocol channel within a Crypto Derivatives OS. This signifies precise price discovery for digital asset derivatives, ensuring atomic settlement and optimizing portfolio margin](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocol-execution-pathway-optimizing-principal-liquidity-and-capital-efficiency.jpg)

## Price Discovery

A system can achieve both goals by using private, competitive negotiation for execution and public post-trade reporting for discovery. </a><a href="https://prime.greeks.live/area/post-trade-transparency/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![The central teal core signifies a Principal's Prime RFQ, routing RFQ protocols across modular arms. Metallic levers denote precise control over multi-leg spread execution and block trades](https://options.greeks.live/wp-content/uploads/2025/07/principals-prime-os-rfq-system-institutional-digital-asset-derivatives.jpg)

## Post-Trade Transparency

Meaning ▴ Post-Trade Transparency defines the public disclosure of executed transaction details, encompassing price, volume, and timestamp, after a trade has been completed. </a><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">
![A complex, faceted geometric object, symbolizing a Principal's operational framework for institutional digital asset derivatives. Its translucent blue sections represent aggregated liquidity pools and RFQ protocol pathways, enabling high-fidelity execution and price discovery](https://options.greeks.live/wp-content/uploads/2025/08/principals-prime-os-digital-asset-derivatives-rfq-execution.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/standard-market-size/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A fractured, polished disc with a central, sharp conical element symbolizes fragmented digital asset liquidity. This Principal RFQ engine ensures high-fidelity execution, precise price discovery, and atomic settlement within complex market microstructure, optimizing capital efficiency](https://options.greeks.live/wp-content/uploads/2025/07/principal-rfq-engine-unifying-fragmented-digital-asset-derivatives-liquidity-for-best-execution.jpg)

## Standard Market Size

Meaning ▴ The Standard Market Size defines a pre-calibrated notional or unit quantity for an order, representing a typical transaction volume for a specific digital asset derivative instrument on a given venue. </a><a href="https://prime.greeks.live/question/how-does-the-daubert-standard-differ-from-the-frye-standard-in-practice/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A deconstructed mechanical system with segmented components, revealing intricate gears and polished shafts, symbolizing the transparent, modular architecture of an institutional digital asset derivatives trading platform. This illustrates multi-leg spread execution, RFQ protocols, and atomic settlement processes](https://options.greeks.live/wp-content/uploads/2025/07/deconstructed-principal-trading-system-revealing-core-mechanics-of-digital-asset-derivatives-execution.jpg)

## Standard Market

The Daubert standard tasks the judge with assessing evidentiary reliability; the Frye standard defers to scientific community consensus. </a><a href="https://prime.greeks.live/area/approved-publication-arrangement/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A central, metallic, multi-bladed mechanism, symbolizing a core execution engine or RFQ hub, emits luminous teal data streams. These streams traverse through fragmented, transparent structures, representing dynamic market microstructure, high-fidelity price discovery, and liquidity aggregation](https://options.greeks.live/wp-content/uploads/2025/07/principal-grade-digital-asset-derivatives-rfq-protocol-engine-facilitating-high-fidelity-execution-and-optimal-price-discovery-across-fragmented-market-microstructure.jpg)

## Approved Publication Arrangement

Meaning ▴ An Approved Publication Arrangement (APA) is a regulated entity authorized to publicly disseminate post-trade transparency data for financial instruments, as mandated by regulations such as MiFID II and MiFIR. </a><a href="https://prime.greeks.live/question/what-are-the-key-differences-in-reporting-requirements-between-public-post-trade-transparency-and-regulatory-transaction-reporting-for-lis-orders/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![An abstract digital interface features a dark circular screen with two luminous dots, one teal and one grey, symbolizing active and pending private quotation statuses within an RFQ protocol. Below, sharp parallel lines in black, beige, and grey delineate distinct liquidity pools and execution pathways for multi-leg spread strategies, reflecting market microstructure and high-fidelity execution for institutional grade digital asset derivatives](https://options.greeks.live/wp-content/uploads/2025/08/institutional-digital-asset-derivatives-rfq-protocol-displaying-multi-leg-execution-status-and-optimal-liquidity-pathways.jpg)

## Post-Trade Reporting

The two reporting streams for LIS orders are architected for different ends ▴ public transparency for market price discovery and regulatory reporting for confidential oversight. </a><a href="https://prime.greeks.live/area/regulatory-reporting/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A sophisticated, multi-component system propels a sleek, teal-colored digital asset derivative trade. The complex internal structure represents a proprietary RFQ protocol engine with liquidity aggregation and price discovery mechanisms](https://options.greeks.live/wp-content/uploads/2025/07/principals-high-fidelity-rfq-engine-for-digital-asset-derivatives-execution.jpg)

## Regulatory Reporting

Meaning ▴ Regulatory Reporting refers to the systematic collection, processing, and submission of transactional and operational data by financial institutions to regulatory bodies in accordance with specific legal and jurisdictional mandates. </a><a href="https://prime.greeks.live/question/what-are-the-key-differences-in-reporting-requirements-between-public-post-trade-transparency-and-regulatory-transaction-reporting-for-lis-orders/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Precision-engineered system components in beige, teal, and metallic converge at a vibrant blue interface. This symbolizes a critical RFQ protocol junction within an institutional Prime RFQ, facilitating high-fidelity execution and atomic settlement for digital asset derivatives](https://options.greeks.live/wp-content/uploads/2025/07/principal-rfq-connectivity-layer-for-digital-asset-derivatives-execution.jpg)

## Trade Reporting

The two reporting streams for LIS orders are architected for different ends ▴ public transparency for market price discovery and regulatory reporting for confidential oversight. </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">
![Modular institutional-grade execution system components reveal luminous green data pathways, symbolizing high-fidelity cross-asset connectivity. This depicts intricate market microstructure facilitating RFQ protocol integration for atomic settlement of digital asset derivatives within a Principal's operational framework, underpinned by a Prime RFQ intelligence layer](https://options.greeks.live/wp-content/uploads/2025/07/modular-high-fidelity-execution-architecture-for-institutional-digital-asset-derivatives-rfq-protocol-integration-and-principals-operational-framework-optimization.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/mifid-ii/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![Precision-engineered institutional grade components, representing prime brokerage infrastructure, intersect via a translucent teal bar embodying a high-fidelity execution RFQ protocol. This depicts seamless liquidity aggregation and atomic settlement for digital asset derivatives, reflecting complex market microstructure and efficient price discovery](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocol-prime-os-core.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/question/how-do-systematic-internalisers-use-commercial-policy-to-manage-rfq-flow/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A chrome cross-shaped central processing unit rests on a textured surface, symbolizing a Principal's institutional grade execution engine. It integrates multi-leg options strategies and RFQ protocols, leveraging real-time order book dynamics for optimal price discovery in digital asset derivatives, minimizing slippage and maximizing capital efficiency](https://options.greeks.live/wp-content/uploads/2025/07/principals-high-fidelity-rfq-execution-digital-asset-derivatives-hub.jpg)

## Commercial Policy

A Systematic Internaliser's commercial policy is a rule-based framework for managing RFQ flow, optimizing risk, and ensuring regulatory compliance. </a><a href="https://prime.greeks.live/news/bitcoin-and-ethereum-etfs-see-substantial-capital-outflows/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![The abstract visual depicts a sophisticated, transparent execution engine showcasing market microstructure for institutional digital asset derivatives. Its central matching engine facilitates RFQ protocol execution, revealing internal algorithmic trading logic and high-fidelity execution pathways](https://options.greeks.live/wp-content/uploads/2025/07/principal-rfq-engine-for-institutional-digital-asset-derivatives.jpg)

## Substantial Basis

Systemic capital reallocation within digital asset exchange-traded products necessitates recalibration of market liquidity models and risk exposure frameworks. </a><a href="https://prime.greeks.live/area/large-in-scale/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A sophisticated digital asset derivatives execution platform showcases its core market microstructure. A speckled surface depicts real-time market data streams](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-execution-core-microstructure.jpg)

## Large-In-Scale

Meaning ▴ Large-in-Scale designates an order quantity significantly exceeding typical displayed liquidity on lit exchanges, necessitating specialized execution protocols to mitigate market impact and price dislocation. </a><a href="https://prime.greeks.live/area/financial-information-exchange/?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" class="glossary-item-box">
![A polished, dark blue domed component, symbolizing a private quotation interface, rests on a gleaming silver ring. This represents a robust Prime RFQ framework, enabling high-fidelity execution for institutional digital asset derivatives](https://options.greeks.live/wp-content/uploads/2025/08/optimized-execution-for-institutional-digital-asset-derivatives-rfq.jpg)

## Financial Information Exchange

Meaning ▴ Financial Information Exchange refers to the standardized protocols and methodologies employed for the electronic transmission of financial data between market participants. </a>

**Tags:** [Pre-Trade Transparency](https://options.greeks.live/area/pre-trade-transparency/), [Best Execution](https://options.greeks.live/area/best-execution/), [Firm Quotes](https://options.greeks.live/area/firm-quotes/), [OTC Trading](https://options.greeks.live/area/otc-trading/), [SI Threshold Calculation](https://options.greeks.live/area/si-threshold-calculation/), [Quoting Obligations](https://options.greeks.live/area/quoting-obligations/)	

## Discover More

- 
### [How Do Regulatory Frameworks like MiFID II Attempt to Mitigate RFQ Opacity?](https://options.greeks.live/question/how-do-regulatory-frameworks-like-mifid-ii-attempt-to-mitigate-rfq-opacity/)
![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. This represents a Prime RFQ intelligence layer for optimal capital efficiency and reduced slippage in volatile markets.](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)

MiFID II mitigates RFQ opacity by mandating pre- and post-trade transparency, thereby enhancing market integrity and execution quality.

- 
### [How Has the Role of Systematic Internalisers in the RFQ Process Evolved since the Introduction of MiFID II?](https://options.greeks.live/question/how-has-the-role-of-systematic-internalisers-in-the-rfq-process-evolved-since-the-introduction-of-mifid-ii/)
![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)

Since MiFID II, Systematic Internalisers have evolved into regulated, principal liquidity hubs for discreetly executing large trades via RFQ.

- 
### [How Do Systematic Internalisers Function as an Alternative to Dark Pools under MiFID II?](https://options.greeks.live/question/how-do-systematic-internalisers-function-as-an-alternative-to-dark-pools-under-mifid-ii/)
![Symmetrical, institutional-grade Prime RFQ component for digital asset derivatives. Metallic segments signify interconnected liquidity pools and precise price discovery. A central intelligence layer drives high-fidelity execution via RFQ protocols, optimizing multi-leg spread transactions.](https://options.greeks.live/wp-content/uploads/2025/07/principals-prime-os-for-digital-asset-derivatives-rfq-execution.jpg)

Systematic Internalisers offer firm, principal-based liquidity, functioning as a key alternative to dark pools under MiFID II's DVC rules.

- 
### [What Are the Regulatory Reporting Requirements for Trades Executed via RFQ Protocols?](https://options.greeks.live/question/what-are-the-regulatory-reporting-requirements-for-trades-executed-via-rfq-protocols/)
![Two smooth, teal spheres, representing institutional liquidity pools, precisely balance a metallic object, symbolizing a block trade executed via RFQ protocol. This depicts high-fidelity execution, optimizing price discovery and capital efficiency within a Principal's operational framework for digital asset derivatives.](https://options.greeks.live/wp-content/uploads/2025/07/precision-execution-bridging-institutional-liquidity-pools-via-rfq-protocol-for-optimized-digital-asset-derivatives-price-discovery.jpg)

Regulatory reporting for RFQ trades translates private negotiations into structured data, ensuring market integrity and providing a vital feedback loop.

- 
### [How Do Systematic Internalisers Interact with the Pre-Trade Transparency Waiver Regime under MiFID II?](https://options.greeks.live/question/how-do-systematic-internalisers-interact-with-the-pre-trade-transparency-waiver-regime-under-mifid-ii/)
![Abstract geometric forms, symbolizing bilateral quotation and multi-leg spread components, precisely interact with robust institutional-grade infrastructure. This represents a Crypto Derivatives OS facilitating high-fidelity execution via an RFQ workflow, optimizing capital efficiency and price discovery.](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocol-engine-infrastructure.jpg)

Systematic Internalisers use MiFID II waivers to provide discreet, principal liquidity for large or illiquid trades, optimizing execution.

- 
### [What Are the Key Differences between Pre-Trade Waivers and Post-Trade Deferrals?](https://options.greeks.live/question/what-are-the-key-differences-between-pre-trade-waivers-and-post-trade-deferrals/)
![A sleek device showcases a rotating translucent teal disc, symbolizing dynamic price discovery and volatility surface visualization within an RFQ protocol. Its numerical display suggests a quantitative pricing engine facilitating algorithmic execution for digital asset derivatives, optimizing market microstructure through an intelligence layer.](https://options.greeks.live/wp-content/uploads/2025/07/prime-os-for-digital-asset-rfq-execution-system-with-smart-liquidity-routing.jpg)

Pre-trade waivers exempt large orders from pre-execution display; post-trade deferrals delay the reporting of executed large trades.

- 
### [What Are the Key Differences between an MTF’s RFQ System and a Systematic Internaliser?](https://options.greeks.live/question/what-are-the-key-differences-between-an-mtfs-rfq-system-and-a-systematic-internaliser/)
![A modular, dark-toned system with light structural components and a bright turquoise indicator, representing a sophisticated Crypto Derivatives OS for institutional-grade RFQ protocols. It signifies private quotation channels for block trades, enabling high-fidelity execution and price discovery through aggregated inquiry, minimizing slippage and information leakage within dark liquidity pools.](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-system-for-optimal-execution-1.jpg)

An MTF RFQ is a competitive, multi-dealer auction on a neutral venue; an SI is a bilateral, principal trade with a single firm.

- 
### [How Does MiFID II Define a Systematic Internaliser’s Obligations?](https://options.greeks.live/question/how-does-mifid-ii-define-a-systematic-internalisers-obligations/)
![Two abstract, segmented forms intersect, representing dynamic RFQ protocol interactions and price discovery mechanisms. The layered structures symbolize liquidity aggregation across multi-leg spreads within complex market microstructure. This visualizes institutional execution pathways, emphasizing atomic settlement and capital efficiency in digital asset derivatives.](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocol-microstructure.jpg)

MiFID II defines a Systematic Internaliser's obligations as the mandated pre- and post-trade transparency for high-volume principal trading.

- 
### [In What Ways Did the Large in Scale Waiver Become Central to Post MiFID II Block Trading Strategies?](https://options.greeks.live/question/in-what-ways-did-the-large-in-scale-waiver-become-central-to-post-mifid-ii-block-trading-strategies/)
![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 key MiFID II provision enabling discreet, large-volume trading, minimizing market impact.

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---

**Original URL:** https://options.greeks.live/question/what-are-the-primary-obligations-of-a-firm-registered-as-a-systematic-internaliser/
