Best Matching Engine Software for Crypto Exchanges
Written & Edited by
Nikita Valshonok
Editorial note: Some links in this article are affiliate links. We may earn a commission if you take action, at no extra cost to you. Our recommendations remain independent and unbiased.
👉 Learn more in our Advertiser Disclosure
Building a high-performance crypto exchange requires a powerful and efficient matching engine—the core system that processes buy and sell orders with speed and precision. As the most critical component of an exchange’s infrastructure, it directly impacts liquidity, execution quality, and overall trading experience.
5 results found
Summary of the Best Matching Engine Software
What Is a Matching Engine?
A matching engine is software developed for financial markets, whose primary function is to connect buy and sell orders from market participants, automatically executing trades. Any trading exchange, particularly cryptocurrency exchanges, relies on a matching engine. Depending on the exchange's scale and resources, they either develop their own custom solutions or use third-party matching engines.
How does a matching engine work?
A matching engine is the core mechanism of order execution in exchanges. It operates based on a predetermined set of rules, ensuring that buy and sell orders are processed efficiently according to execution criteria such as order price, creation time, or order size. Below are the main crypto exchange matching engine mechanisms:
- Price-time priority (First In First Out). One of the most common order matching engine technologies, also called FIFO. Orders are prioritized based on price first (better price gets priority), and then by time of placement. For example, if two traders place buy orders at the same price, the one placed earlier is executed first.
- Pro-rata matching. A mechanism that follows a set of rules where larger orders receive execution priority. If multiple traders place orders at the same price level, they are executed proportionally based on their order size.
- Regular lot matching. Regular lot matching is a type of execution mechanism in a matching engine where trades must be placed in fixed lot sizes (e.g., 100 shares, 1 contract) and cannot be smaller or fractional. This is common in traditional stock and futures markets. In crypto trading, which commonly uses other matching mechanisms, exchanges also have a minimum trade size, but it is usually very small, and traders can buy or sell any amount above it without being restricted to fixed lot multiples.
- Dark pool matching. In this mechanism, orders are executed privately and do not appear in the public order book. It is commonly used in institutional trading, where order anonymity helps reduce market impact and increase execution flexibility for large trades. For instance, one of the projects in our Top Picks, the DXmatch matching engine by Devexperts, supports dark pool solutions, allowing for the private execution of large trades without displaying them in the public order book
Why matching engines matter
A crypto trading engine is essential for the functioning of a trading exchange, ensuring order execution and management by processing buy and sell orders according to predefined rules. It also provides real-time market data, including current pricing, trading volume, and order book updates.
Conclusion
In this article, you’ve learned about the top matching engine software for crypto exchanges. These engines are crucial to the functioning of exchanges, providing a seamless and efficient trading experience. From price-time priority (FIFO) to dark pool matching, each solution offers unique benefits tailored to the needs of different exchanges. Understanding these options helps identify the best solutions for building and managing high-performance crypto exchanges.
Frequently Asked Questions
Disclaimer
In line with the Trust Project guidelines, the educational content on this website is offered in good faith and for general information purposes only. BeInCrypto prioritizes providing high-quality information, taking the time to research and create informative content for readers. While partners may reward the company with commissions for placements in articles, these commissions do not influence the unbiased, honest, and helpful content creation process. Any action taken by the reader based on this information is strictly at their own risk. Please note that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.