I presume boats would be wired to underwater fiber. Let's assume latency from (A, NYC) to (B, London) is 6ms. You're trading a stock and monitoring PriceA and PriceB. If you're only trading on one exchange or the other, I think you're right about there being no benefit. You'd make your trading decision 3ms faster than anyone at either exchange, but it would still take 3ms for your order to reach the exchange. However, if you need to trade on both exchanges, the midpoint is the best place to make your decisions. Also should be a good place for an exchange itself if they want to suck volume from the geographically disparate ones. I believe once an exchange is set up in the ocean, though, and takes any significant volume, that all the normal exchanges will just cluster together and consolidate. Just seems more trustworthy to me. Though, sometimes I think my orders are lost in the Bermuda Triangle already..
Here is a paper which apparently first introduced this idea: http://www.alexwg.org/publications/PhysRevE_82-056104.pdf
Nobody on this board was alive when mkts were free of regulations. Please do elaborate on your statement.
This must be a joke! Nonetheless, if it happens I'm in! Those South Americans are crazy. That is a very creative way to make money though. They're basically screwing their governments out of any taxes on incomes gained through trading. If it happens I wonder how governments would deal with it.
The article said they are arbing the small price differences between 2 or more exchanges. So there is no advantage with 2 exchanges, but if we have 3, I assume the ship can be anywhere in the triangle made by those 3 exchanges and that would give an advantage over another trader, who is not in the triangle. I don't really see how they arb 3 exchanges, you only need a price difference in 2...