Covalence

Let's Share

Djinn - Enterprise Crypto by Molecule

Enterprise crypto trading is out in the open, but the companies who trade have to live in the shadows. Risk management processes are homegrown, and crypto transactions are wedged in systems that don’t fit them — or worse, they can’t be seen at all because they are trapped in apps on phones.

Until now.

Molecule, the leading cloud-native ETRM/CTRM system, today announces Djinn — our enterprise offering for crypto.

With Djinn, companies trading cryptocurrencies can see their risk and exposure alongside everything else they trade — electricity, other energy commodities, renewables, ags, softs, chemicals, metals, and more.

Djinn connects to exchanges like CME and Gemini to automatically download executed futures, options, spot, and storage transactions — and models them right alongside the physical and financial derivatives they relate to.

Position, P&L, and other metrics calculate instantly, and Djinn downloads market data from relevant markets. FX conversions are built-in, to support customers trading in any traditional fiat currency.

Customers using Djinn benefit from the full raft of Molecule’s enterprise risk management features, including audit trails, automatic locking, fine-grained permissions, and complex book structures — as well as the modern APIs and easy-to-use screens Molecule is known for.

With Djinn, enterprise crypto customers can expect to be up, running, and compliant in 90 days.

If you’re trading crypto and want to come out of the shadows, contact our sales team for a demo. With Djinn, your enterprise crypto wish is our command.

Software

Do you Interface with our FCM?

We get this question often when speaking with prospective customers. The answer? Probably – and for most users, it doesn't matter whether we do or not.

How Molecule gets exchange trades

If you trade on any of the exchanges where Molecule has FIX adapters – ICE, CME, or Nodal Exchange – Molecule gets your trades from the exchange a few seconds after they clear, full stop.

No additional interfaces are needed to get your trades in: not to your FCM, clearing broker, TT, CQG, or anything else.

What Molecule does with FCM files

Molecule connects to an ever-growing number of FCMs (13 at last count) to download their statements as a check every day. We compare what the statement says to what Molecule has from a position perspective – because that's one of the most likely places for things to go out of sync. If we get position right, it's likely everything else is in line.

Can you also reconcile trade prices and fees with my FCM?

We're working on it.

Can you tell me what my margin needs to be or reconcile cash?

That would require us to have a SPAN engine on our platform (for ICE and CME)  – and we don't have that today. With the data we collect, we can get close to reconciling cash – see more on our Knowledge Base.

Incidentally, if you know how SPAN works, and would like to help us figure it out – hit us up!

SoftwareFeatures

H1 2021: What's New So Far

It's been a busy year! In case you've missed our release notes--here are some of the new-and-improved features we've shipped in Molecule so far this year.

  1. Included Power Settlement Prices: We noticed our power customers often had quite a time mapping lots of LMPs and block prices. So, we partnered with NRGStream to provide LMPs from North American ISOs, as part of our new Elektra package!
  2. New, Complex Trade Types: We've rolled out two new trade types that are especially important for our power customers (but also helpful for others, too!): (a) stepwise trades – which turn from yearlies, to monthlies, dailies, and then hourlies (great for FTR options), and (b) dynamic-volume trades – which are trades whose volumes actualize automatically, from Assets.
  3. Manage your own Books: We rolled out our new, user-facing Book Maintenance screen.
  4. Payment Dates: No more using custom fields to capture T+1, T+2, etc payment dates. Molecule captures those at trade entry and calculates the dates for you.
  5. Improved Fee Recommendations: Molecule can now apply fee schedules by FCM and block status to more accurately model your portfolio.

We also improved lots of our existing features, like our Actualization screen (which graduated from Beta),

and our right-click-a-trade to show its Valuation history popup:

There's lots more cooking right now – including APX integration, new custom fields, and accounting line item generation/GL integration. Keep your eyes peeled!

SoftwareFeatures

How much does an ETRM cost in 2021?

For most trading companies, an ETRM costs about $100k-200k/year, plus taxes and implementation fees. The smallest, simplest, exchange-only shops can get away with simpler software (around $60k/year) – while the largest companies, with enterprise support, physical logistics, and heavy workflow needs may pay $500k/year or more. Contract terms are generally 1-5 years.

These prices are what we've gathered across the industry – meaning, they include what we charge and what we've heard about our competitors.

What levers change the price?

Usually, the factors that drive the pricing quote are:

  • Complexity of the portfolio (i.e., exchange-only vs bilateral, commodities)
  • Number of users
  • Needs for physical logistics features
  • Expectations around support

The biggest item that changes the cost of the solution – and which can ultimately triple in cost during the life of an ETRM/CTRM system – is implementation.

Implementing ETRMs is a difficult, consultative task that often involves building some customizations. Vendors will typically quote the lowest number that seems likely, but include a provision that indicates the actual spend will be based on "time and expenses", or T&E.

What costs aren't accounted for?

Typically, the price of an ETRM system includes the software itself and a low estimate of the implementation cost. It does not include:

  • Market data (ICE, CME, Nodal Exchange, Platts, Argus, OPIS, LMPs)
  • A market data loading/aggregation solution (i.e., a way to get the market data into the ETRM system)
  • A business intelligence solution (i.e., custom reporting)

Is Molecule any different?

On pricing, we are in line with standard industry pricing. Where we are different:

  • Our contracts are generally 1-2 years, and can bill monthly.
  • We include implementation costs in our fixed-price quote – not an estimate and no T&E for the scope we agree on; we wear the implementation risk.
  • We include some market data in our quote (where the vendor allows us to), such as the LMPs and block pricing we provide for North American ISOs. We also have our own tools that load the data automatically.
  • We include an embedded business intelligence solution, so we can provide custom reports as part of our subscription.

Cost Savings

We've Closed Our Series A

I am excited to announce that Molecule has just closed a $12M Series A, and plan to use the investment to make Molecule even better.

We’ve come a long way since our founding in 2012. We’ve added support for many commodities, deal types, and geographies. Along the way, we’ve grown faster and leaner than many of the companies that came before us, added dozens of customers to our portfolio, and in late 2020, were named the #1 SaaS vendor in the ETRM/CTRM industry, full stop. Our goal is to become the #1 ETRM for electricity — and then the #1 ETRM vendor worldwide.

Last year, we noticed that over half of our customers trade power, and we doubled down with the launch of our Elektra power package to help accelerate the energy industry’s transition to electricity and renewables. This investment helps us do just that. With it, we plan to ramp up feature development, specifically in the following areas:

  • New features related to physical power and full-lifecycle renewable credits management
  • Enhanced back-office functionality, accounting, and settlements for all commodities, plus support for Counterparty contracts
  • Simplification and enhancement of Product and Counterparty management
  • New features focused on enterprise customers, like data warehousing and third-party audit certifications
  • Support for new deal types, commodities, and other securities

The investor group includes Mercury, a Houston-based early-stage venture capital firm that was an early believer in the Molecule team. We are grateful for their ongoing support as well as the support of our customers.

I can’t wait to show you what we cook up; our team is looking forward to making your work life even easier.

Features