The emerging board wholesale market is rapidly expanding due to increased demand for alternative financing and liquidity solutions. It primarily involves institutional investors trading unlisted company shares on fragmented platforms, characterized by regulatory challenges, technology-driven execution, and growing adoption of electronic communication networks (ECNs). Key participants include specialized market makers, alternative asset managers, and fintech firms.

The growth is driven by several factors. First, capital needs among private companies have surged, with 2023 data showing a 24% year-over-year increase in secondary market transactions, totaling $12.5 billion, per the U.S. Securities and Exchange Commission (SEC). Second, regulatory shifts, such as the SEC’s 2023 proposal to impose a 10% transaction tax on retail speculative trades, aim to balance liquidity and market stability. Third, technology adoption has reduced costs and improved transparency; platforms like LMAX and FlexTrade now account for 35% of total volume, with average trade execution times falling to 0.8 seconds in 2023. However, fragmentation persists, with over 50 unregulated ECNs operating, leading to inconsistent pricing and compliance risks. Aima’s 2023 report notes that 68% of market participants prioritize platforms offering real-time data and automated reporting. Despite challenges like liquidity fragmentation and rising compliance costs, the market is projected to reach $30 billion by 2027 at a 15% compound annual growth rate (CAGR), driven by institutional adoption and regulatory clarity.