DFlow Dashboard is a first-of-its-kind interface for order flow sellers (i.e. crypto wallets) and their users (i.e. retail investors). The DFlow Dashboard lets wallets easily create and manage order flow auctions, and the public access real-time data and insights on order handling and execution.
Transparency and having proper disclosures are essential for maintaining fairness and protecting retail investors in decentralized financial markets. The DFlow Dashboard is a commitment to bringing availability and accessibility of auction and execution information. It's not enough just making information publicly available – putting data in a readable format is equally important.
Background on Traditional Regulations
The US securities market is governed by a regulation called Regulation NMS (National Market System) and under this regulation, the SEC adopted two rules to require market participants to make public reports on order execution. The intention is to improve transparency in retail order execution.
Rule 605: a monthly report published by "market centers" (e.g. broker-dealers) to show basic stats on execution quality like how market orders of various sizes are executed relative to a public quote (including price improvements, execution speed). 605 reports can be found directly from market makers like Citadel or Virtu, and a sample schema can be found on the SEC's website.
Rule 606: a quarterly report published by broker-dealers on their order routing practices. Brokers like Robinhood are required to publish these reports and a recent sample can be found here.
DFlow: Provably Transparent
DFlow Dashboard takes transparency one step further by surfacing measurements of order execution quality in a readable and provable way. The current problem is: retail investors have a difficult time making an informed decision on which trading app has the best execution quality and verifying if their orders received the best prices.
DFlow intends on being open-sourced and making all calculation methodologies public. Specifically, the Dashboard brings the following:
Execution quality statistics: a set of measurements like time-to-execution and price improvements used to create "report cards" for order flow sources so the public can make their own decisions on which broker is giving the best execution.
Verifiable best price: a best price measurement used to represent the best public quote and enforce market makers to fill orders at or better than this level. DFlow calls this price the Consolidated Best Price.
Open auctions: all order flow auctions are deployed on the DFlow Chain meaning rebates to market makers, a point of contention in traditional PFOF, are clearly trackable. The DFlow Dashboard will also act like an explorer for the public to view auction stats like order flow price over time and see all available auctions by owner (i.e. the wallets).