Secure Financial Business with Hard Pipe Technology

Posted on Aug 4, 2023 by

Significance of the Transport Network in Financial Business

Financial networks have two main requirements for transmission networks: safety and quality. Regarding security, financial industry security is greatly challenged. In terms of quality, transmission is mainly to ensure the rapid and accurate transmission of our business.

In 2013, massive cyber attack broke out in South Korea, and a number of banks, including TV stations, were attacked. The attacks were quite serious. Many online banks and ATM financial services were interrupted, and the banking business was greatly impacted.

The situations of the attacked TV stations are different: although the office network of the TV station is also attacked and paralyzed, the network of the program broadcast is not affected because it is physically isolated from the office network, so the TV programs can still be played normally. From this we can draw the following conclusions: 1. The structure of different networks will affect network security. 2. Physical isolation of the network is a very reliable network security protection measure.

Comparison between the Hard Pipe and Soft Pipe Technology

So what kind of technology can meet the financial transmission network requirements? We can divide the existing technology into two types: one is the OTN hard pipe technology typified by MSTP, and the other is the OTN soft pipe technology represented by PTN and IP technology. OTN hard pipe technology is very similar to a rail-based transit system, where each traffic transmission occupies a different track. OTN soft pipe technology is very similar to highway traffic system, where traffic transmission is bandwidth sharing and traffic can flexibly change lanes as vehicles. Two different schools of technology result in different service transport characteristics in service bearer.

Service Isolation

First of all, let's look at the characteristics of service isolation, the service carrying technology can be divided into 4 levels from 0 to 3, of which 0 and 1 level of OTN hard pipeline technology for wavelength and MSTP can achieve real physical isolation. The layer 2 and layer 3 technologies corresponding to PTN and IP belong to OTN soft pipeline technologies, which can only achieve logical isolation based on labels. These two different technologies achieve different isolation: one is physical isolation, and the other is logical isolation. Logical isolation means that although service channels are isolated, they are not physically separated. Therefore, services affect each other. If physical isolation is implemented, there is no impact between services. Even if a service is blocked, other services will not be affected. Therefore, to truly achieve the characteristics of physical isolation, it is necessary to use OTN hard pipeline technology.

Network Security

From the point of view of security, suppose that the same attack on these two networks. As for the network with a hard pipe, because it does a multi-layer package, the security is relatively higher. Because there is no encapsulation of services, it is relatively easy to attack the network with a soft pipe and see the services carried by the network.

Therefore, when building a transmission carrier network, there are two key points in security: first, when renting the operator's network, or building the transmission network, we must use OTN hard pipeline technology, so as to ensure the physical isolation between the financial business and other businesses (such as the business with the operator), and the security of financial business. Another key point is that the service aggregation node must use OTN hard pipe technology to ensure the physical isolation between the financial production network service and office network service. Through the use of OTN hard pipe technology, a great wall of physical isolation security can be constructed for financial networks.

Service Quality

Transaction Latency

On September 18th this year, at 2 p.m. Eastern time, the Federal Reserve issued a message that it would maintain the intensity of quantitative easing, which is more than the market expects. In a very short period of time, a large number of business transactions broke out, and after post-analysis, most of the trade orders were completed within 0.15 milliseconds. It can be seen that when the financial industry has a very major opportunity in the market, it is necessary to have a low-delay carrier network to quickly capture this opportunity, which is a key indicator for our financial construction.

For the delay index, we compare the two technologies of soft and hard pipelines. In terms of the technology carrying, the delay of OTN soft pipeline's transmitting data services may be up to 4 to 5 times that of hard pipeline. When carrying TDM services, the delay of soft pipe is 40 times that of hard pipe. This is mainly due to the fact that the soft pipeline is based on the item-by-item forwarding mechanism, and the process is relatively complicated. When we build the financial transport network, the OTN hard pipe is the best choice to meet its shortest delay requirement.

There is a saying in Wall Street: If the trading system is ahead by one millisecond, it will bring a profit of 100 million dollars a year. So in the financial system, lower events can bring greater profits. Hard pipes can help us get a head start in the highly competitive financial transactions.

Transmission Accuracy

Another aspect of quality is the accuracy of transmission. Due to the different technical systems, the detection accuracy of soft pipe and hard pipe is very different. The detection accuracy of the OTN hard pipe can be 10-9, while the OTN soft pipe can generally only be 10-3. What kind of impact is it on the financial business? When the network signal quality deteriorates, such as the bending of optical fibers, OTN hard pipes can ensure the correct transmission of financial services, so financial transactions will not be affected. If the signal quality of the soft pipeline deteriorates, there may be packet loss, or even Mosaic phenomenon in the video business, so the financial transaction time may be prolonged, and even some transactions will fail.

There are two examples. One is the case of a bank with two-location three-center interconnect: the equipment of MSP hard pipe is selected to carry, which ensures the safety and the bearing quality of the service. At the same time, it can support 1+1 protection of network links and 1+1 protection of devices to improve network security and reliability.

The other is the case of a government department: when building a national high-tech video conference system, it has very high standards for the quality. The video can not appear Mosaic, and the delay requirements are very low. At the beginning, they chose the OTN soft pipe technology, but after a period of actual use, they found that the quality did not meet the design requirements. Therefore, the network scheme is modified to adopt MSTP hard pipe, which can well meet the requirements of high-definition video, image, sound, delay and other technical indicators.


When it comes to network technology bearing, there are two major schools of technology: hard pipe technology and soft pipe technology. By comparison, OTN hard pipe technology enables physical isolation and is more secure because of the multilayer package. Because the MSTP hard pipeline can achieve the shortest transmission delay and more accurate service transmission, it can provide higher-quality service transmission.

There are two points to pay attention to in network construction: First, when building the transmission network lines, MSP hard pipes are needed to realize the physical isolation between financial services and operators' services and other network services, so as to secure the financial services in case of any problem in the network. Second, the service convergence node needs to be carried by hard pipes, so as to achieve the physical isolation between the production network and office network. If the office network is attacked by a virus, the production network will not be affected, so that the security of the network can be better guaranteed.

OTN hard pipelines can provide a physically isolated, highly secure transmission network with low latency and accurate transmission of services that can help to get a head start in the highly competitive financial market transactions.

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