VIRT filing — read by section

Item 1. Financial Statements

ITEM 1. FINANCIAL STATEMENTS 
 Index to Condensed Consolidated Financial Statements 
 
 PAGE
NUMBER 
 
 Condensed Consolidated Statements of Financial Condition (Unaudited) 
 3 
 
 Condensed Consolidated Statements of Comprehensive Income (Unaudited) 
 5 
 
 Condensed Consolidated Statements of Changes in Equity (Unaudited) 
 6 
 
 Condensed Consolidated Statements of Cash Flows (Unaudited) 
 8 
 
 Notes to Condensed Consolidated Financial Statements (Unaudited) 
 10 
 
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 Table of Contents 
 Virtu Financial, Inc. and Subsidiaries 
 Condensed Consolidated Statements of Financial Condition (Unaudited) 

 (in thousands, except share data) June 30,
2023 December 31,
2022 
 Assets 
 Cash and cash equivalents $ 698,674 $ 981,580 
 Cash restricted or segregated under regulations and other 47,133 56,662 
 Securities borrowed 1,665,179 1,187,674 
 Securities purchased under agreements to resell 793,815 336,999 
 Receivables from broker-dealers and clearing organizations 1,459,826 1,115,185 
 Trading assets, at fair value: 
 Financial instruments owned 5,155,084 3,667,481 
 Financial instruments owned and pledged 1,297,216 963,071 
 Receivables from customers 130,623 80,830 
 Property, equipment and capitalized software (net of accumulated depreciation of $ 341,375 and $ 460,763 as of June 30, 2023 and December 31, 2022, respectively) 
 95,735 85,194 
 Operating lease right-of-use assets 174,136 187,442 
 Goodwill 1,148,926 1,148,926 
 Intangibles (net of accumulated amortization of $ 350,053 and $ 318,013 as of June 30, 2023 and December 31, 2022, respectively) 
 289,440 321,480 
 Deferred tax assets 134,549 146,801 
 
 Other assets ($ 73,435 and $ 78,965 , at fair value, as of June 30, 2023 and December 31, 2022, respectively) 
 299,348 303,916 
 Total assets $ 13,389,684 $ 10,583,241 
 
 Liabilities and equity 
 Liabilities 
 Short-term borrowings $ 111,721 $ 3,944 
 Securities loaned 1,306,894 1,060,432 
 Securities sold under agreements to repurchase 1,120,151 627,549 
 Payables to broker-dealers and clearing organizations 848,277 273,843 
 Payables to customers 39,740 46,525 
 Trading liabilities, at fair value: 
 Financial instruments sold, not yet purchased 5,812,887 4,196,974 
 Tax receivable agreement obligations 215,542 238,758 
 
 Accounts payable, accrued expenses and other liabilities 379,815 448,635 
 Operating lease liabilities 224,086 239,202 
 Long-term borrowings 1,778,270 1,795,952 
 Total liabilities 11,837,383 8,931,814 
 
 Commitments and Contingencies (Note 14) 
 
 Virtu Financial Inc. Stockholders' equity 
 Class A common stock (par value $ 0.00001 ), Authorized — 1,000,000,000 and 1,000,000,000 shares, Issued — 134,725,247 and 133,071,754 shares, Outstanding — 94,004,647 and 98,549,464 shares at June 30, 2023 and December 31, 2022, respectively 
 1 1 
 Class B common stock (par value $ 0.00001 ), Authorized — 175,000,000 and 175,000,000 shares, Issued and Outstanding — 0 and 0 shares at June 30, 2023 and December 31, 2022, respectively 
 — — 
 Class C common stock (par value $ 0.00001 ), Authorized — 90,000,000 and 90,000,000 shares, Issued and Outstanding — 8,856,531 and 9,030,066 shares at June 30, 2023 and December 31, 2022, respectively 
 — — 
 Class D common stock (par value $ 0.00001 ), Authorized — 175,000,000 and 175,000,000 shares, Issued and Outstanding — 60,091,740 and 60,091,740 shares at June 30, 2023 and December 31, 2022, respectively 
 1 1 
 Treasury stock, at cost, 40,720,600 and 34,522,290 shares at June 30, 2023 and December 31, 2022, respectively 
 ( 1,071,784 ) ( 954,637 ) 
 Additional paid-in capital 1,335,269 1,292,613 
 Retained earnings (accumulated deficit) 980,481 972,317 
 Accumulated other comprehensive income (loss) 31,132 31,604 
 Total Virtu Financial Inc. stockholders' equity 1,275,100 1,341,899 
 Noncontrolling interest 277,201 309,528 

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 Table of Contents 
 Virtu Financial, Inc. and Subsidiaries 
 Condensed Consolidated Statements of Financial Condition (Unaudited) 

 (in thousands, except share data) June 30,
2023 December 31,
2022 
 Total equity 1,552,301 1,651,427 
 
 Total liabilities and equity $ 13,389,684 $ 10,583,241 

 See accompanying Notes to the Condensed Consolidated Financial Statements (Unaudited). 
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 Table of Contents 
 Virtu Financial, Inc. and Subsidiaries 
 Condensed Consolidated Statements of Comprehensive Income (Unaudited) 

 Three Months Ended June 30, Six Months Ended June 30, 
 (in thousands, except share and per share data) 2023 2022 2023 2022 
 Revenues: 
 Trading income, net $ 306,168 $ 395,928 $ 718,679 $ 918,235 
 Interest and dividends income 97,979 30,792 180,223 51,804 
 Commissions, net and technology services 109,504 136,340 230,948 290,995 
 Other, net ( 6,797 ) 41,678 ( 2,617 ) 44,966 
 Total revenue 506,854 604,738 1,127,233 1,306,000 
 
 Operating Expenses: 
 Brokerage, exchange, clearance fees and payments for order flow, net 122,471 156,986 267,993 307,366 
 Communication and data processing 56,959 55,699 113,771 111,534 
 Employee compensation and payroll taxes 95,557 98,604 198,994 202,084 
 
 Interest and dividends expense 112,493 48,716 210,094 91,254 
 Operations and administrative 25,491 13,577 49,790 38,792 
 Depreciation and amortization 15,913 16,334 31,261 33,812 
 Amortization of purchased intangibles and acquired capitalized software 16,020 16,277 32,040 32,757 
 Termination of office leases ( 146 ) 677 ( 50 ) 1,384 
 Debt issue cost related to debt refinancing, prepayment and commitment fees 1,771 1,437 3,948 27,121 
 Transaction advisory fees and expenses 8 558 23 980 
 
 Financing interest expense on long-term borrowings 24,850 22,089 49,138 43,422 
 Total operating expenses 471,387 430,954 957,002 890,506 
 Income before income taxes and noncontrolling interest 35,467 173,784 170,231 415,494 
 Provision for income taxes 5,923 24,888 30,605 66,674 
 Net income 29,544 148,896 139,626 348,820 
 Noncontrolling interest ( 12,842 ) ( 63,729 ) ( 65,044 ) ( 151,397 ) 
 
 Net income available for common stockholders $ 16,702 $ 85,167 $ 74,582 $ 197,423 
 
 Earnings per share 
 Basic $ 0.16 $ 0.78 $ 0.73 $ 1.78 
 Diluted $ 0.16 $ 0.78 $ 0.73 $ 1.77 
 
 Weighted average common shares outstanding 
 Basic 94,973,489 104,960,826 96,376,926 107,133,079 
 Diluted 94,973,489 105,478,278 96,376,926 107,759,784 
 
 Net income $ 29,544 $ 148,896 $ 139,626 $ 348,820 
 Other comprehensive income 
 Foreign exchange translation adjustment, net of taxes 2,527 ( 19,810 ) 4,175 ( 24,978 ) 
 Net change in unrealized cash flow hedges gain (loss), net of taxes 8,202 14,062 ( 4,966 ) 61,935 
 Comprehensive income 40,273 143,148 138,835 385,777 
 Less: Comprehensive income attributable to noncontrolling interest ( 17,189 ) ( 60,173 ) ( 64,724 ) ( 164,332 ) 
 Comprehensive income attributable to common stockholders $ 23,084 $ 82,975 $ 74,111 $ 221,445 

 See accompanying Notes to the Condensed Consolidated Financial Statements (Unaudited). 
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 Table of Contents 
 Virtu Financial, Inc. and Subsidiaries 
 Condensed Consolidated Statements of Changes in Equity (Unaudited) 
 Three and Six Months Ended June 30, 2023, and 2022 

 Class A Common Stock Class C Common Stock Class D Common Stock Treasury Stock Additional Paid-in Capital Retained Earnings (Accumulated Deficit) Accumulated Other Comprehensive Income (loss) Total Virtu Financial Inc. Stockholders' Equity Noncontrolling Interest Total Equity 
 (in thousands, except share and interest data)
 Shares Amounts Shares Amounts Shares Amounts Shares Amounts Amounts 
 
 Balance at December 31, 2022 133,071,754 $ 1 9,030,066 $ — 60,091,740 $ 1 ( 34,522,290 ) $ ( 954,637 ) $ 1,292,613 $ 972,317 $ 31,604 $ 1,341,899 $ 309,528 $ 1,651,427 
 Share based compensation 2,393,550 — — — — — — — 31,030 — — 31,030 — 31,030 
 Repurchase of Class C common stock — ( 21,498 ) — — — — — ( 424 ) — — ( 424 ) — ( 424 ) 
 Treasury stock purchases ( 902,947 ) — — — — — ( 3,932,499 ) ( 75,568 ) — ( 17,650 ) — ( 93,218 ) — ( 93,218 ) 
 
 Net income — — — — — — — — — 57,881 — 57,881 52,202 110,083 
 Foreign exchange translation adjustment — — — — — — — — — — 980 980 668 1,648 
 Net change in unrealized cash flow hedges gains — — — — — — — — — — ( 7,834 ) ( 7,834 ) ( 5,334 ) ( 13,168 ) 
 Dividends ($ 0.24 per share of Class A common stock and participating Restricted Stock Unit and Restricted Stock Awards) and distributions from Virtu Financial to noncontrolling interest 
 — — — — — — — — — ( 24,696 ) — ( 24,696 ) ( 27,308 ) ( 52,004 ) 
 
 Issuance of common stock in connection with employee exchanges 152,037 — — — — — — — — — — — — — 
 Repurchase of Virtu Financial Units and corresponding number of Class C common stock in connection with employee exchanges — — ( 152,037 ) — — — — — — — — — — — 
 Balance at March 31, 2023 134,714,394 $ 1 8,856,531 $ — 60,091,740 $ 1 ( 38,454,789 ) $ ( 1,030,205 ) $ 1,323,219 $ 987,852 $ 24,750 $ 1,305,618 $ 329,756 $ 1,635,374 
 Share based compensation 20,000 — — — — — — — 12,050 — — 12,050 — 12,050 
 
 Treasury stock purchases ( 9,147 ) — — — — — ( 2,265,811 ) ( 41,579 ) — ( 165 ) — ( 41,744 ) — ( 41,744 ) 
 
 Net income — — — — — — — — — 16,702 — 16,702 12,842 29,544 
 Foreign exchange translation adjustment — — — — — — — — — — 1,503 1,503 1,024 2,527 
 Net change in unrealized cash flow hedges gains — — — — — — — — — — 4,879 4,879 3,323 8,202 
 Dividends ($ 0.24 per share of Class A and Class B common stock and participating Restricted Stock Unit and Restricted Stock Awards) and distributions from Virtu Financial to noncontrolling interest 
 — — — — — — — — — ( 23,908 ) — ( 23,908 ) ( 69,744 ) ( 93,652 ) 
 
 Balance at June 30, 2023 134,725,247 $ 1 8,856,531 $ — 60,091,740 $ 1 ( 40,720,600 ) $ ( 1,071,784 ) $ 1,335,269 $ 980,481 $ 31,132 $ 1,275,100 $ 277,201 $ 1,552,301 
 
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 Table of Contents 
 Virtu Financial, Inc. and Subsidiaries 
 Condensed Consolidated Statements of Changes in Equity (Unaudited) 
 Three and Six Months Ended June 30, 2023, and 2022 

 Class A Common Stock Class C Common Stock Class D Common Stock Treasury Stock Additional Paid-in Capital Retained Earnings (Accumulated Deficit) Accumulated Other Comprehensive Income (loss) Total Virtu Financial Inc. Stockholders' Equity Noncontrolling Interest Total Equity 
 (in thousands, except share and interest data)
 Shares Amounts Shares Amounts Shares Amounts Shares Amounts Amounts 
 Balance at December 31, 2021 131,497,645 $ 1 9,359,065 $ — 60,091,740 $ 1 ( 18,326,863 ) $ ( 494,075 ) $ 1,223,119 $ 830,538 $ ( 10,196 ) $ 1,549,388 $ 314,230 $ 1,863,618 
 Share based compensation 1,669,030 — — — — — — — 27,377 — — 27,377 — 27,377 
 Repurchase of Class C common stock — — ( 234,269 ) — — — — — ( 8,204 ) — — ( 8,204 ) — ( 8,204 ) 
 Treasury stock purchases ( 612,844 ) — — — — — ( 8,908,544 ) ( 287,211 ) — ( 18,354 ) — ( 305,565 ) — ( 305,565 ) 
 Stock options exercised 246,879 — — — — — — — 4,691 — — 4,691 — 4,691 
 
 Net income — — — — — — — — — 112,257 — 112,257 87,668 199,925 
 Foreign exchange translation adjustment — — — — — — — — — — ( 3,172 ) ( 3,172 ) ( 1,996 ) ( 5,168 ) 
 Net change in unrealized cash flow hedges gains — — — — — — — — — — 29,387 29,387 18,486 47,873 
 Dividends ($ 0.24 per share of Class A common stock and participating Restricted Stock Units and Restricted Stock Awards) and distributions from Virtu Financial to noncontrolling interest 
 — — — — — — — — — ( 27,054 ) — ( 27,054 ) ( 98,751 ) ( 125,805 ) 
 Issuance of common stock in connection with employee exchanges 71,641 — — — — — — — — — — — — — 
 Repurchase of Virtu Financial Units and corresponding number of Class C common stock in connection with employee exchanges — — ( 71,641 ) — — — — — — — — — — — 
 Balance at March 31, 2022 132,872,351 $ 1 9,053,155 $ — 60,091,740 $ 1 ( 27,235,407 ) $ ( 781,286 ) $ 1,246,983 $ 897,387 $ 16,019 $ 1,379,105 $ 319,637 $ 1,698,742 
 Share based compensation — — — — — — — — 9,411 — — 9,411 — 9,411 
 Repurchase of Class C common stock — — ( 1,800 ) — — — — — ( 52 ) — — ( 52 ) — ( 52 ) 
 Treasury stock purchases — — — — — — ( 1,762,756 ) ( 47,486 ) — — — ( 47,486 ) — ( 47,486 ) 
 Stock options exercised 22,000 — — — — — — — 418 — — 418 — 418 
 Net income — — — — — — — — — 85,167 — 85,167 63,729 148,896 
 Foreign exchange translation adjustment — — — — — — — — — — ( 10,773 ) ( 10,773 ) ( 9,037 ) ( 19,810 ) 
 Net change in unrealized cash flow hedges losses — — — — — — — — — — 8,580 8,580 5,482 14,062 
 Dividends ($ 0.24 per share of Class A and Class B common stock and participating Restricted Stock Units and Restricted Stock Award) and distributions from Virtu Financial to noncontrolling interest 
 — — — — — — — — — ( 26,067 ) — ( 26,067 ) ( 76,906 ) ( 102,973 ) 
 Issuance of common stock in connection with employee exchanges 21,289 — — — — — — — — — — — — — 
 
 Repurchase of Virtu Financial Units and corresponding number of Class C common stock in connection with employee exchanges — — ( 21,289 ) — — — — — — — — — — — 
 
 Contributions from noncontrolling interests — $ — — $ — — $ — — $ — $ — $ — $ — $ — $ 39,200 $ 39,200 
 Balance at June 30, 2022 132,915,640 $ 1 9,030,066 $ — 60,091,740 $ 1 ( 28,998,163 ) $ ( 828,772 ) $ 1,256,760 $ 956,487 $ 13,826 $ 1,398,303 $ 342,105 $ 1,740,408 
 
 See accompanying Notes to the Condensed Consolidated Financial Statements (Unaudited). 
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 Table of Contents 
 Virtu Financial, Inc. and Subsidiaries 
 Condensed Consolidated Statements of Cash Flows (Unaudited) 

 Six Months Ended June 30, 
 (in thousands) 2023 2022 
 Cash flows from operating activities 
 Net income $ 139,626 $ 348,820 
 
 Adjustments to reconcile net income to net cash used by operating activities: 
 Depreciation and amortization 31,261 33,812 
 Amortization of purchased intangibles and acquired capitalized software 32,040 32,757 
 Debt issue cost related to debt refinancing and prepayment 306 24,316 
 Amortization of debt issuance costs and deferred financing fees 3,452 4,184 
 Termination of office leases ( 50 ) 1,384 
 Share-based compensation 31,754 32,709 
 
 Deferred taxes 13,165 16,604 
 
 Other 2,742 5,335 
 Changes in operating assets and liabilities: 
 Securities borrowed ( 477,505 ) ( 20,294 ) 
 Securities purchased under agreements to resell ( 456,816 ) ( 3,313 ) 
 Receivables from broker-dealers and clearing organizations ( 350,768 ) ( 392,821 ) 
 Trading assets, at fair value ( 1,821,748 ) ( 923,766 ) 
 Receivables from customers ( 49,793 ) ( 80,457 ) 
 Operating lease right-of-use assets 13,306 16,852 
 Other assets 6,104 ( 71,206 ) 
 Securities loaned 246,462 ( 92,439 ) 
 Securities sold under agreements to repurchase 492,602 ( 13,132 ) 
 Payables to broker-dealers and clearing organizations 574,434 195,306 
 Payables to customers ( 6,785 ) 51,970 
 Trading liabilities, at fair value 1,615,913 960,450 
 Operating lease liabilities ( 15,116 ) ( 21,072 ) 
 Accounts payable, accrued expenses and other liabilities ( 50,970 ) ( 48,377 ) 
 Net cash (used in) provided by operating activities ( 26,384 ) 57,622 
 
 Cash flows from investing activities 
 Development of capitalized software ( 26,411 ) ( 26,769 ) 
 Acquisition of property and equipment ( 21,865 ) ( 14,246 ) 
 
 Other investing activities ( 6,860 ) 45,018 
 
 Net cash (used in) provided by investing activities ( 55,136 ) 4,003 
 
 Cash flows from financing activities 
 
 Dividends to stockholders and distributions from Virtu Financial to noncontrolling interest ( 145,656 ) ( 228,778 ) 
 
 Repurchase of Class C common stock ( 424 ) ( 8,256 ) 
 Purchase of treasury stock ( 134,962 ) ( 353,051 ) 
 Stock options exercised — 5,109 
 Short-term borrowings, net 111,056 94,945 
 Proceeds from long-term borrowings — 1,800,000 
 
 Repayment of long term borrowings ( 18,000 ) ( 1,599,774 ) 
 
 Payment of tax receivable agreement obligations ( 23,216 ) ( 21,343 ) 
 Debt issuance costs ( 3,888 ) ( 35,882 ) 
 
 Contributions from noncontrolling interests — 39,200 
 Net cash used in financing activities ( 215,090 ) ( 307,830 ) 
 
 Effect of exchange rate changes on cash and cash equivalents 4,175 ( 24,978 ) 
 
 Net decrease in cash and cash equivalents ( 292,435 ) ( 271,183 ) 
 Cash, cash equivalents, and restricted or segregated cash, beginning of period 1,038,242 1,120,953 
 Cash, cash equivalents, and restricted or segregated cash, end of period $ 745,807 $ 849,770 
 
 Supplementary disclosure of cash flow information 

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 Table of Contents 
 Virtu Financial, Inc. and Subsidiaries 
 Condensed Consolidated Statements of Cash Flows (Unaudited) 

 Six Months Ended June 30, 
 (in thousands) 2023 2022 
 Cash paid for interest $ 225,332 $ 104,765 
 Cash paid for taxes 15,345 86,495 
 
 Non-cash investing activities 
 Share-based and accrued incentive compensation to developers relating to capitalized software 9,811 8,234 
 
 See accompanying Notes to the Condensed Consolidated Financial Statements (Unaudited). 
 9 

 Virtu Financial, Inc. and Subsidiaries 
 Notes to the Condensed Consolidated Financial Statements (Unaudited) 
 (dollars in thousands, except shares and per share amounts, unless otherwise noted) 
 
 1. Organization and Basis of Presentation 
 
 Organization 
 
 The accompanying Condensed Consolidated Financial Statements include the accounts and operations of Virtu Financial, Inc. (“VFI” or, collectively with its wholly owned or controlled subsidiaries, “Virtu” or the “Company”). VFI is a Delaware corporation whose primary asset is its ownership interest in Virtu Financial LLC (“Virtu Financial”). As of June 30, 2023, VFI owned approximately 58.9 % of the membership interests of Virtu Financial. VFI is the sole managing member of Virtu Financial and operates and controls all of the businesses and affairs of Virtu Financial and its subsidiaries (the “Group”). 
 
 The Company is a leading financial firm that leverages cutting edge technology to deliver liquidity to the global markets and innovative, transparent trading solutions to its clients. The Company provides deep liquidity in over 25,000 financial instruments, on over 235 venues, in 36 countries worldwide to help create more efficient markets. Leveraging its global market structure expertise and scaled, multi-asset infrastructure, the Company provides its clients with a robust product suite including offerings in execution, liquidity sourcing, analytics and broker-neutral, multi-dealer platforms in workflow technology. The Company’s product offerings allow its clients to trade on hundreds of venues in over 50 countries and across multiple asset classes, including global equities, Exchange-Traded Funds ("ETFs"), options, foreign exchange, futures, fixed income, cryptocurrencies, and other commodities. The Company’s integrated, multi-asset analytics platform provides a range of pre- and post-trade services, data products and compliance tools that its clients rely upon to invest, trade and manage risk across global markets. 
 
 The Company has completed two significant acquisitions that have expanded and complemented Virtu Financial's original electronic trading and marking making business. On July 20, 2017, the Company completed the all-cash acquisition of KCG Holdings, Inc. (“KCG”) (the “Acquisition of KCG”). On March 1, 2019 (the “ITG Closing Date”), the Company completed the acquisition of Investment Technology Group, Inc. and its subsidiaries (“ITG”) in an all-cash transaction (the “ITG Acquisition”). 
 
 Virtu Financial’s principal United States ("U.S.") subsidiary is Virtu Americas LLC (“VAL”), which is a U.S. broker-dealer. Other principal U.S. subsidiaries include Virtu Financial Global Markets LLC, a U.S. trading entity focused on futures and currencies; Virtu ITG Analytics LLC, a provider of pre- and post-trade analysis, fair value, and trade optimization services; and Virtu ITG Platforms LLC, a provider of workflow technology solutions and network connectivity services. Principal foreign subsidiaries include Virtu Financial Ireland Limited (“VFIL”) and Virtu Europe Trading Limited (“VETL”) (f/k/a Virtu ITG Europe Limited), each formed in Ireland; Virtu ITG UK Limited (“VIUK”), formed in the United Kingdom; Virtu Canada Corp (f/k/a Virtu ITG Canada Corp.), formed in Canada; Virtu Financial Asia Pty Ltd. and Virtu ITG Australia Limited, each formed in Australia; Virtu ITG Hong Kong Limited, formed in Hong Kong; and Virtu Financial Singapore Pte. Ltd. and Virtu ITG Singapore Pte. Ltd., each formed in Singapore, all of which are trading entities focused on asset classes in their respective geographic regions. 
 
 The Company has two operating segments: (i) Market Making and (ii) Execution Services; and one non-operating segment: Corporate. See Note 20 "Geographic Information and Business Segments" for a further discussion of the Company’s segments. 
 
 Basis of Consolidation and Form of Presentation 
 
 These Condensed Consolidated Financial Statements are presented in U.S. dollars, have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) regarding financial reporting with respect to Form 10-Q and accounting standards generally accepted in the United States of America (“U.S. GAAP”) promulgated by the Financial Accounting Standards Board (“FASB”) in the Accounting Standards Codification (“ASC” or the “Codification”), and reflect all adjustments that, in the opinion of management, are normal and recurring, and that are necessary for a fair statement of the results for the periods presented. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted in accordance with SEC rules and regulations. The Condensed Consolidated Financial Statements of the Company include its equity interests in Virtu Financial and its subsidiaries. As sole managing member of Virtu Financial, the Company exerts control over the Group’s operations. The Company consolidates Virtu Financial and its subsidiaries’ financial statements and records the interests in Virtu Financial that 
 10 

 the Company does not own as noncontrolling interests. All intercompany accounts and transactions have been eliminated in consolidation. 
 
 2. Summary of Significant Accounting Policies 
 
 For a detailed discussion of the Company's significant accounting policies, see Note 2 "Summary of Significant Accounting Policies" in our consolidated financial statements included in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2022. 
 
 Accounting Pronouncements Recently Adopted 
 
 Derivatives and Hedging - In March 2022, the FASB issued ASU 2022-01, Derivatives and Hedging - Fair Value Hedging - Portfolio Layer Method (Topic 815) . The ASU expands the scope of permissible hedging, and permits the use of different derivative structures as hedging instruments. The Company adopted this ASU on January 1, 2023 and it did not have a material impact on its condensed consolidated financial statements. 
 
 Liabilities - Supplier Finance Programs - In September 2022, the FASB issued ASU 2022-04, Liabilities—Supplier Finance Programs (Subtopic 405-50) . This ASU requires new quantitative and qualitative disclosure requirements for a buyer who enters into supplier financing programs. The Company adopted this ASU on January 1, 2023 and it did not have a material impact on its condensed consolidated financial statements. 
 
 Accounting Pronouncements Not Yet Adopted as of June 30, 2023 
 
 Fair Value Measurement - In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions (Topic 326) . The ASU clarifies the impact of contractual sale restrictions on the fair value of an equity security. Additionally, this ASU requires disclosure of the nature and remaining duration of the sale restriction. This ASU is effective for periods beginning after December 15, 2023. The Company is currently evaluating the impact of this ASU but does not expect it to have a material impact on its condensed consolidated financial statements. 
 
 Leases - Common Control Arrangements - In March 2023, the FASB issued ASU 2023-01, Leases—Common Control Arrangements (Topic 842) . This ASU provides updated guidance for accounting for common control leases and leasehold improvements. This ASU is effective for periods beginning after December 15, 2023. The Company is currently evaluating the impact of this ASU but does not expect it to have a material impact on its condensed consolidated financial statements. 
 
 Investments - Equity Method and Joint Ventures - In March 2023, the FASB issued ASU 2023-02, Investments—Equity Method and Joint Ventures (Topic 323) . This ASU provides updated guidance for accounting for investments in tax credit structures. This ASU is effective for periods beginning after December 15, 2023. The Company is currently evaluating the impact of this ASU but does not expect it to have a material impact on its condensed consolidated financial statements. 
 
 3. Earnings per Share 
 
 The below table contains a reconciliation of Net income before income taxes and noncontrolling interest to Net income available for common stockholders: 
 
 Three Months Ended June 30, Six Months Ended June 30, 
 (in thousands) 2023 2022 2023 2022 
 Income before income taxes and noncontrolling interest $ 35,467 $ 173,784 $ 170,231 $ 415,494 
 Provision for income taxes 5,923 24,888 30,605 66,674 
 Net income 29,544 148,896 139,626 348,820 
 
 Noncontrolling interest ( 12,842 ) ( 63,729 ) ( 65,044 ) ( 151,397 ) 
 
 Net income available for common stockholders $ 16,702 $ 85,167 $ 74,582 $ 197,423 

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 The calculation of basic and diluted earnings per share is presented below: 
 
 Three Months Ended June 30, Six Months Ended June 30, 
 (in thousands, except for share or per share data) 2023 2022 2023 2022 
 Basic earnings per share: 
 Net income available for common stockholders $ 16,702 $ 85,167 $ 74,582 $ 197,423 
 
 Less: Dividends and undistributed earnings allocated to participating securities ( 1,176 ) ( 3,305 ) ( 3,853 ) ( 7,164 ) 
 Net income available for common stockholders, net of dividends and undistributed earnings allocated to participating securities 15,526 81,862 70,729 190,259 
 
 Weighted average shares of common stock outstanding: 
 Class A 94,973,489 104,960,826 96,376,926 107,133,079 
 
 Basic earnings per share $ 0.16 $ 0.78 $ 0.73 $ 1.78 

 Three Months Ended June 30, Six Months Ended June 30, 
 (in thousands, except for share or per share data) 2023 2022 2023 2022 
 Diluted earnings per share: 
 Net income available for common stockholders, net of dividends and undistributed earnings allocated to participating securities $ 15,526 $ 81,862 $ 70,729 $ 190,259 
 
 Weighted average shares of common stock outstanding: 
 Class A 
 Issued and outstanding 94,973,489 104,960,826 96,376,926 107,133,079 
 Issuable pursuant to Amended and Restated 2015 Management Incentive Plan — 517,452 — 626,705 
 94,973,489 105,478,278 96,376,926 107,759,784 
 
 Diluted earnings per share (1) $ 0.16 $ 0.78 $ 0.73 $ 1.77 
 
 (1) The dilutive impact of unexercised stock options excludes from the computation of EPS 54,618 options for the three months ended June 30, 2023, and 17,647 options for the six months ended June 30, 2023 because inclusion of the options would have been anti-dilutive. 
 
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 4. Tax Receivable Agreements 
 
 For a detailed discussion of the Company's tax receivable agreements, see Note 5 "Tax Receivable Agreements" in our consolidated financial statements included in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2022. 
 
 For the purposes of the tax receivable agreements discussed above, the cash savings realized by the Company are computed by comparing the actual income tax liability of the Company to the amount of such taxes the Company would have been required to pay had there been (i) no increase to the tax basis of the assets of Virtu Financial as a result of the purchase or exchange of Virtu Financial Units, (ii) no tax benefit from the tax basis in the intangible assets of Virtu Financial on the date of the IPO and (iii) no tax benefit as a result of the Net Operating Losses (“NOLs”) and other tax attributes of Virtu Financial. Subsequent adjustments of the tax receivable agreements obligations due to certain events (e.g., changes to the expected realization of NOLs or changes in tax rates) will be recognized within income before taxes and noncontrolling interests in the Condensed Consolidated Statements of Comprehensive Income. 
 
 The Company made its first payment of $ 7.0 million in February 2017, and subsequent payments of $ 12.4 million in September 2018, $ 13.3 million in March 2020, $ 16.5 million in April 2021, $ 21.3 million in March 2022, and $ 23.3 million in April 2023. Tax receivable payments are expected to range from approximately $ 36.4 thousand to $ 22.0 million per year over the next 15 years. 
 
 At June 30, 2023 and December 31, 2022, the Company’s remaining deferred tax assets that relate to the matters described above were approximately $ 151.8 million and $ 162.1 million, respectively, and the Company’s liabilities over the next 15 years pursuant to the tax receivable agreements were approximately $ 215.5 million and $ 238.8 million for June 30, 2023 and December 31, 2022, respectively. The amounts recorded as of June 30, 2023 and December 31, 2022 are based on best estimates available at the respective dates and may be subject to change after the filing of the Company’s U.S. federal and state income tax returns for the years in which tax savings were realized. 
 
 5. Goodwill and Intangible Assets 
 
 The Company has two operating segments: (i) Market Making; and (ii) Execution Services; and one non-operating segment: Corporate. As of June 30, 2023 and December 31, 2022, the Company’s total amount of goodwill recorded was $ 1,148.9 million. No goodwill impairment was recognized during the three and six months ended June 30, 2023 and 2022. 
 
 The following table presents the details of goodwill by segment as of June 30, 2023 and December 31, 2022: 
 
 (in thousands) Market Making Execution Services Corporate Total 
 
 Balance as of period-end $ 755,292 $ 393,634 $ — $ 1,148,926 

 As of June 30, 2023 and December 31, 2022, the Company's total amount of intangible assets recorded was $ 289.4 million and $ 321.5 million, respectively. Acquired intangible assets consisted of the following as of June 30, 2023 and December 31, 2022: 
 
 As of June 30, 2023 
 (in thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Useful Lives
(Years) 
 Customer relationships $ 486,600 $ ( 213,907 ) $ 272,693 10 to 12 
 Technology 136,000 ( 125,853 ) 10,147 1 to 6 
 Favorable occupancy leases 5,895 ( 4,793 ) 1,102 3 to 15 
 Exchange memberships 3,998 — 3,998 Indefinite 
 Trade name 3,600 ( 3,600 ) — 3 
 ETF issuer relationships 950 ( 950 ) — 9 
 ETF buyer relationships 950 ( 950 ) — 9 
 Other $ 1,500 $ — $ 1,500 Indefinite 
 $ 639,493 $ ( 350,053 ) $ 289,440 

 13 

 As of December 31, 2022 
 (in thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Useful Lives
(Years) 
 Customer relationships $ 486,600 $ ( 189,986 ) $ 296,614 10 to 12 
 Technology 136,000 ( 118,119 ) 17,881 1 to 6 
 Favorable occupancy leases 5,895 ( 4,408 ) 1,487 3 to 15 
 Exchange memberships 3,998 — 3,998 Indefinite 
 Trade name 3,600 ( 3,600 ) — 3 
 ETF issuer relationships 950 ( 950 ) — 9 
 ETF buyer relationships 950 ( 950 ) — 9 
 Other $ 1,500 $ — $ 1,500 Indefinite 
 $ 639,493 $ ( 318,013 ) $ 321,480 

 Amortization expense relating to finite-lived intangible assets was approximately $ 16.0 million and $ 16.3 million for the three months ended June 30, 2023, and 2022, respectively, and $ 32.0 million, and $ 32.8 million for the six months ended June 30, 2023, and 2022, respectively. This is included in Amortization of purchased intangibles and acquired capitalized software in the accompanying Condensed Consolidated Statements of Comprehensive Income. 
 
 The Company expects to record amortization expense as follows over the next five subsequent years: 
 
 (in thousands) 
 Remainder of 2023 $ 31,921 
 2024 50,845 
 2025 47,879 
 2026 47,879 
 2027 47,879 
 2028 47,879 

 14 

 6. Receivables from/Payables to Broker-Dealers and Clearing Organizations 
 
 The following is a summary of receivables from and payables to brokers-dealers and clearing organizations at June 30, 2023 and December 31, 2022: 
 
 (in thousands) June 30, 2023 December 31, 2022 
 Assets 
 Due from prime brokers $ 966,509 $ 560,111 
 Deposits with clearing organizations 175,060 146,927 
 Net equity with futures commission merchants 106,101 137,312 
 Unsettled trades with clearing organizations 852 87,145 
 Securities failed to deliver 179,709 149,747 
 Commissions and fees 31,595 33,943 
 Total receivables from broker-dealers and clearing organizations $ 1,459,826 $ 1,115,185 
 
 Liabilities 
 Due to prime brokers $ 501,100 $ 229,424 
 Net equity with futures commission merchants (1) ( 45,685 ) ( 32,381 ) 
 Unsettled trades with clearing organizations 274,522 38 
 Securities failed to receive 113,734 70,576 
 Commissions and fees 4,606 6,186 
 Total payables to broker-dealers and clearing organizations $ 848,277 $ 273,843 

 (1) The Company presents its balances, including outstanding principal balances on all broker credit facilities, on a net-by-counterparty basis within receivables from and payables to broker-dealers and clearing organizations when the criteria for offsetting are met . 
 
 Included as a deduction from “Due from prime brokers” and “Net equity with futures commission merchants” is the outstanding principal balance on all of the Company’s prime brokerage credit facilities (described in Note 8 "Borrowings") of approximately $ 140.6 million and $ 212.9 million as of June 30, 2023 and December 31, 2022, respectively. The loan proceeds from the credit facilities are available only to meet the initial margin requirements associated with the Company’s ordinary course futures and other trading positions, which are held in the Company’s trading accounts with an affiliate of the respective financial institutions. The credit facilities are fully collateralized by the Company’s trading accounts and deposit accounts with these financial institutions. “Securities failed to deliver” and “Securities failed to receive” include amounts with a clearing organization and other broker-dealers. 
 
 7. Collateralized Transactions 
 
 The Company is permitted to sell or repledge securities received as collateral and use these securities to secure repurchase agreements, enter into securities lending transactions or deliver these securities to counterparties or clearing organizations to cover short positions. At June 30, 2023 and December 31, 2022, substantially all of the securities received as collateral have been repledged. 
 
 The fair value of the collateralized transactions at June 30, 2023 and December 31, 2022 are summarized as follows: 
 
 (in thousands) June 30, 2023 December 31, 2022 
 Securities received as collateral: 
 Securities borrowed $ 1,631,134 $ 1,148,238 
 Securities purchased under agreements to resell 793,815 336,849 
 $ 2,424,949 $ 1,485,087 

 In the normal course of business, the Company pledges qualified securities with clearing organizations to satisfy daily margin and clearing fund requirements. 
 
 Financial instruments owned and pledged, where the counterparty has the right to repledge, at June 30, 2023 and December 31, 2022 consisted of the following: 
 
 (in thousands) June 30, 2023 December 31, 2022 
 Equities $ 1,285,503 $ 957,443 
 
 Exchange traded notes 11,713 5,628 
 $ 1,297,216 $ 963,071 

 15 

 8. Borrowings 
 
 Short-term Borrowings, net 
 
 The following summarizes the Company's short-term borrowing balances outstanding, net of related debt issuance costs, with each described in further detail below. 
 
 June 30, 2023 
 (in thousands) Borrowing Outstanding Deferred Debt Issuance Cost Short-term Borrowings, net 
 Broker-dealer credit facilities $ 115,000 $ ( 3,279 ) $ 111,721 
 
 $ 115,000 $ ( 3,279 ) $ 111,721 

 December 31, 2022 
 (in thousands) Borrowing Outstanding Deferred Debt Issuance Cost Short-term Borrowings, net 
 
 Short-term bank loans 3,944 — 3,944 
 
 $ 3,944 $ — $ 3,944 

 Broker-Dealer Credit Facilities 
 
 The Company is a party to two secured credit facilities with a financial institution to finance overnight securities positions purchased as part of its ordinary course broker-dealer market making activities. One of the facilities (the “Uncommitted Facility”) is provided on an uncommitted basis with an aggregate borrowing limit of $ 400 million, and is collateralized by VAL's trading and deposit account maintained at the financial institution. The second credit facility (the “Committed Facility”) with the same financial institution has a borrowing limit of $ 650 million. The Committed Facility consists of two borrowing bases: Borrowing Base A Loan is to be used to finance the purchase and settlement of securities; Borrowing Base B Loan is to be used to fund margin deposit with the National Securities Clearing Corporation. Borrowing Base A Loans are available up to $ 650 million and bear interest at the adjusted Secured Overnight Financing Rate ("SOFR") or base rate plus 1.25 % per annum. Borrowing Base B Loans are subject to a sublimit of $ 300 million and bear interest at the adjusted SOFR or base rate plus 2.50 % per annum. A commitment fee of 0.50 % per annum on the average daily unused portion of this facility is payable quarterly in arrears. 
 
 On May 25, 2022, Virtu Financial Singapore Pte. Ltd. entered into a revolving credit facility with a financial institution (the "Overdraft Facility") to provide a source of short-term financing. The facility has an aggregate borrowing limit of $ 10 million, and bears interest at the adjusted SOFR or base rate plus 3.5 % per annum. 
 
 On March 20, 2020, VAL entered into a Loan Agreement (the “Founder Member Loan Facility”) with TJMT Holdings LLC (the “Founder Member”), as lender and administrative agent, providing for unsecured term loans from time to time (the “Founder Member Loans”) in an aggregate original principal amount not to exceed $ 300 million. The Founder Member Loans were available to be borrowed in one or more borrowings on or after March 20, 2020 and prior to September 20, 2020 (the "Founder Member Loan Term"). The Founder Member Loan Facility Term expired as of September 20, 2020 without VAL having borrowed any Founder Member Loans at any time. The Founder Member is an affiliate of Mr. Vincent Viola, the Company’s founder and Chairman Emeritus. Upon the execution of and in consideration for the Lender’s (as defined in the Founder Member Loan Facility) commitments under the Founder Member Loan Facility, the Company delivered to the Founder Member a warrant to purchase shares of the Company’s Class A Common Stock. Terms of the warrant are set forth in further detail in Note 17 "Capital Structure". 
 
 The following summarizes the Company’s broker-dealer credit facilities' carrying values, net of unamortized debt issuance costs, where applicable. These balances are included within Short-term borrowings on the Condensed Consolidated Statements of Financial Condition. 
 
 16 

 At June 30, 2023 
 (in thousands) Interest Rate Financing Available Borrowing Outstanding Deferred Debt Issuance Cost Outstanding Borrowings, net 
 Broker-dealer credit facilities: 
 Uncommitted facility 6.26 % $ 400,000 $ 110,000 $ ( 3,279 ) $ 106,721 
 Committed facility 8.47 % 650,000 — — — 
 Overdraft facility 8.59 % 10,000 5,000 — 5,000 
 
 $ 1,060,000 $ 115,000 $ ( 3,279 ) $ 111,721 
 
 At December 31, 2022 
 (in thousands) Interest Rate Financing Available Borrowing Outstanding Deferred Debt Issuance Cost Outstanding Borrowings, net 
 Broker-dealer credit facilities: 
 Uncommitted facility 5.50 % $ 400,000 $ — $ — $ — 
 Committed facility 7.67 % 650,000 — — — 
 Overdraft facility 7.80 % 10,000 — — — 
 $ 1,060,000 $ — $ — $ — 

 The following summarizes interest expense for the broker-dealer facilities. Interest expense is included within Interest and dividends expense in the accompanying Condensed Consolidated Statements of Comprehensive Income. 
 
 Three Months Ended June 30, Six Months Ended June 30, 
 (in thousands) 2023 2022 2023 2022 
 Broker-dealer credit facilities: 
 Uncommitted facility $ 1,987 $ 789 $ 3,547 $ 1,293 
 Committed facility — 23 — 38 
 
 $ 1,987 $ 812 $ 3,547 $ 1,331 

 Short-Term Bank Loans 
 
 The Company’s international securities clearance and settlement activities are funded with operating cash or with short-term bank loans in the form of overdraft facilities. At June 30, 2023, there was no balance associated with international settlement activities outstanding under these facilities. At December 31, 2022, there was $ 3.9 million associated with international settlement activities outstanding under these facilities at a weighted average interest rate of approximately 3.8 %. These short-term bank loan balances are included within Short-term borrowings on the Condensed Consolidated Statements of Financial Condition. 
 
 17 

 Prime Brokerage Credit Facilities 
 
 The Company maintains short-term credit facilities with various prime brokers and other financial institutions from which it receives execution or clearing services. The proceeds of these facilities are used to meet margin requirements associated with the products traded by the Company in the ordinary course, and amounts borrowed are collateralized by the Company’s trading accounts with the applicable financial institution. 
 
 At June 30, 2023 
 (in thousands) Weighted Average
Interest Rate Financing
Available Borrowing
Outstanding 
 Prime Brokerage Credit Facilities: 
 Prime brokerage credit facilities (1) 7.87 % $ 591,000 $ 140,644 
 $ 591,000 $ 140,644 

 At December 31, 2022 
 (in thousands) Weighted Average
Interest Rate Financing
Available Borrowing
Outstanding 
 Prime Brokerage Credit Facilities: 
 Prime brokerage credit facilities (1) 7.42 % $ 591,000 $ 212,912 
 $ 591,000 $ 212,912 

 (1) Outstanding borrowings are included with Receivables from/Payables to broker-dealers and clearing organizations within the Condensed Consolidated Statements of Financial Condition. 
 
 Interest expense in relation to the facilities was $ 3.6 million and $ 1.7 million for the three months ended June 30, 2023 and 2022, respectively, and $ 7.1 million and $ 3.3 million for the six months ended June 30, 2023 and 2022, respectively. 
 
 Long-Term Borrowings 
 
 The following summarizes the Company’s long-term borrowings, net of unamortized discount and debt issuance costs, where applicable: 
 
 At June 30, 2023 
 (in thousands) Maturity
Date Interest
Rate Outstanding Principal Discount Deferred Debt Issuance Cost Outstanding Borrowings, net 
 Long-term borrowings: 
 First Lien Term Loan Facility January 2029 8.19 % $ 1,782,000 $ ( 3,526 ) $ ( 24,457 ) $ 1,754,017 
 
 SBI bonds January 2026 5.00 % 24,253 — — 24,253 
 $ 1,806,253 $ ( 3,526 ) $ ( 24,457 ) $ 1,778,270 

 At December 31, 2022 
 (in thousands) Maturity
Date Interest
Rate Outstanding Principal Discount Deferred Debt Issuance Cost Outstanding Borrowings, net 
 Long-term borrowings: 
 First Lien Term Loan Facility January 2029 7.42 % $ 1,800,000 $ ( 3,881 ) $ ( 26,858 ) $ 1,769,261 
 
 SBI bonds January 2026 5.00 % 26,693 — ( 2 ) 26,691 
 $ 1,826,693 $ ( 3,881 ) $ ( 26,860 ) $ 1,795,952 

 Credit Agreements 
 
 In connection with the ITG Acquisition, Virtu Financial, VFH, and Impala Borrower LLC (the "Acquisition Borrower") entered into a credit agreement, with the lenders party thereto, Jefferies Finance LLC, as administrative agent and Jefferies Finance LLC and RBC Capital Markets, as joint lead arrangers and joint bookrunners (the "Acquisition Credit Agreement"). 
 
 18 

 On January 13, 2022 (the “Credit Agreement Closing Date”), Virtu Financial, VFH Parent LLC, a Delaware limited liability company and a subsidiary of Virtu Financial (“VFH”), entered into a credit agreement with the lenders party thereto, JPMorgan Chase Bank, N.A. as administrative agent and JPMorgan Chase Bank, N.A., Goldman Sachs Bank USA, RBC Capital Markets, Barclays Bank plc, Jefferies Finance LLC, BMO Capital Markets Corp., and CIBC World Markets Corp., as joint lead arrangers and bookrunners (the “Credit Agreement”). The Credit Agreement provides (i) a senior secured first lien term loan in an aggregate principal amount of $ 1,800.0 million, drawn in its entirety on the Credit Agreement Closing Date, the proceeds of which were used by VFH to repay all amounts outstanding under the Acquisition Credit Agreement, to pay fees and expenses in connection therewith, to fund share repurchases under the Company’s repurchase program, and for general corporate purposes, and (ii) a $ 250.0 million senior secured first lien revolving facility to VFH, with a $ 20.0 million letter of credit subfacility and a $ 20.0 million swingline subfacility. 
 
 The term loan borrowings and revolver borrowings under the Credit Agreement bear interest at a per annum rate equal to, at the Company’s election, either (i) the greatest of (a) the prime rate in effect, (b) the greater of (1) the federal funds effective rate and (2) the overnight bank funding rate, in each case plus 0.50 %, (c) an adjusted term SOFR rate with an interest period of one month plus 1.00 % and (d)(1) in the case of term loan borrowings, 1.50 % and (2) in the case of revolver borrowings, 1.00 %, plus, (x) in the case of term loan borrowings, 2.00 % and (y) in the case of revolver borrowings, 1.50 %, or (ii) the greater of (a) an adjusted term SOFR rate for the interest period in effect and (b) (1) in the case of term loan borrowings, 0.50 % and (2) in the case of revolver borrowings, 0.00 %, plus, (x) in the case of term loan borrowings, 3.00 % and (y) in the case of revolver borrowings, 2.50 %. In addition, a commitment fee accrues at a rate of 0.50 % per annum on the average daily unused amount of the revolving facility, with step-downs to 0.375 % and 0.25 % per annum based on VFH’s first lien leverage ratio, and is payable quarterly in arrears. 
 
 The revolving facility under the Credit Agreement is subject to a springing net first lien leverage ratio test which may spring into effect as of the last day of a fiscal quarter if usage of the aggregate revolving commitments exceeds a specified level as of such date. VFH is also subject to contingent principal prepayments based on excess cash flow and certain other triggering events. Borrowings under the Credit Agreement are guaranteed by Virtu Financial and VFH’s material non-regulated domestic restricted subsidiaries and secured by substantially all of the assets of VFH and the guarantors, in each case, subject to certain exceptions. 
 
 The Credit Agreement contains certain customary covenants and events of default, including relating to a change of control. If an event of default occurs and is continuing, the lenders under the Credit Agreement will be entitled to take various actions, including the acceleration of amounts outstanding under the Credit Agreement and all actions permitted to be taken by a secured creditor in respect of the collateral securing the obligations under the Credit Agreement. 
 
 Under the Credit Agreement, the term loans will mature on January 13, 2029. The term loans amortize in annual installments equal to 1.0 % of the original aggregate principal amount of the term loans and the Company repaid $ 18.0 million on January 13, 2023. The revolving commitments will terminate on January 13, 2025. As of June 30, 2023, $ 1,782 million was outstanding under the term loans, and there were no amounts outstanding under the first lien revolving facility. 
 
 In October 2019, the Company entered into a five-year $ 525 million floating-to-fixed interest rate swap agreement. In January 2020, the Company also entered into a five-year $ 1,000 million floating-to-fixed interest rate swap agreement. These two interest rate swaps met the criteria to be considered and were designated qualifying cash flow hedges under ASC 815 in the first quarter of 2020, and they effectively fixed interest payment obligations on $ 525.0 million and $ 1,000 million of principal under the Acquisition First Lien Term Loan Facility at rates of 4.3 % and 4.4 % through September 2024 and January 2025, respectively, based on the interest rates set forth in the Acquisition Credit Agreement. In April 2021, each of the swap agreements described above was novated to another counterparty and amended in connection with such novation. The amendments included certain changes to collateral posting obligations, and also had the effect of increasing the effective fixed interest payment obligations to rates of 4.5 %, with respect to the earlier maturing swap arrangement, and 4.6 % with respect to the later maturing swap arrangement. In January 2022, in order to align the swap agreements with the Credit Agreement, the Company amended each of the swap agreements to align the floating rate term of such swap agreements to SOFR. The effective fixed interest payment obligations remained at 4.5 %, with respect to the earlier maturing swap arrangement, and 4.6 % with respect to the later maturing swap arrangement. 
 19 

 SBI Bonds 
 
 On July 25, 2016, VFH issued Japanese Yen Bonds (collectively the “SBI Bonds”) in the aggregate principal amount of ¥ 3.5 billion ($ 33.1 million at issuance date) to SBI Life Insurance Co., Ltd. and SBI Insurance Co., Ltd. The proceeds from the SBI Bonds were used to partially fund the investment in Japannext Co., Ltd. (as described in Note 9 "Financial Assets and Liabilities"). The SBI Bonds are guaranteed by Virtu Financial. The SBI Bonds are subject to fluctuations on the Japanese Yen currency rates relative to the Company’s reporting currency (U.S. Dollar) with the changes reflected in Other, net in the Condensed Consolidated Statements of Comprehensive Income. In December 2022, the maturity of the SBI Bonds was extended to 2026. The principal balance was ¥ 3.5 billion ($ 24.3 million) as of June 30, 2023 and ¥ 3.5 billion ($ 26.7 million) as of December 31, 2022. The Company had a gain of $ 2.1 million and a gain of $ 3.0 million for the three months ended June 30, 2023 and 2022, respectively, and a gain of $ 2.4 million, and a gain of $ 4.9 million, during the six months ended June 30, 2023 and 2022, respectively, due to changes in foreign currency rates. 
 
 As of June 30, 2023, aggregate future required minimum principal payments based on the terms of the long-term borrowings were as follows: 
 
 (in thousands) June 30, 2023 
 Remainder of 2023 $ — 
 2024 18,000 
 2025 18,000 
 2026 42,253 
 2027 18,000 
 2028 18,000 
 Thereafter 1,692,000 
 Total principal of long-term borrowings $ 1,806,253 

 9. Financial Assets and Liabilities 
 
 Financial Instruments Measured at Fair Value 
 
 The fair value of equities, options, on-the-run U.S. government obligations and exchange traded notes is estimated using recently executed transactions and market price quotations in active markets and are categorized as Level 1 with the exception of inactively traded equities and certain other financial instruments, which are categorized as Level 2. The Company’s corporate bonds, derivative contracts and other U.S. and non-U.S. government obligations have been categorized as Level 2. Fair value of the Company’s derivative contracts is based on the indicative prices obtained from a number of banks and broker-dealers, as well as management’s own analyses. The indicative prices have been independently validated through the Company’s risk management systems, which are designed to check prices with information independently obtained from exchanges and venues where such financial instruments are listed or to compare prices of similar instruments with similar maturities for listed financial futures in foreign exchange. 
 
 The Company prices certain financial instruments held for trading at fair value based on theoretical prices, which can differ from quoted market prices. The theoretical prices reflect price adjustments primarily caused by the fact that the Company continuously prices its financial instruments based on all available information. This information includes prices for identical and near-identical positions, as well as the prices for securities underlying the Company’s positions, on other exchanges that are open after the exchange on which the financial instruments is traded closes. The Company validates that all price adjustments can be substantiated with market inputs and checks the theoretical prices independently. Consequently, such financial instruments are classified as Level 2. 
 
 20 

 Fair value measurements for those items measured on a recurring basis are summarized below as of June 30, 2023: 
 
 June 30, 2023 
 (in thousands) Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Counterparty and Cash Collateral Netting Total Fair Value 
 Assets 
 Financial instruments owned, at fair value: 
 Equity securities $ 781,837 $ 1,724,573 $ — $ — $ 2,506,410 
 U.S. and Non-U.S. government obligations 775,363 524,523 — — 1,299,886 
 Corporate Bonds — 1,323,402 — — 1,323,402 
 Exchange traded notes 57 12,989 — — 13,046 
 Currency forwards — 611,584 — ( 603,560 ) 8,024 
 Options 4,316 — — — 4,316 
 $ 1,561,573 $ 4,197,071 $ — $ ( 603,560 ) $ 5,155,084 
 
 Financial instruments owned, pledged as collateral: 
 Equity securities $ 770,965 $ 514,538 $ — $ — $ 1,285,503 
 
 Exchange traded notes 6 11,707 — — 11,713 
 $ 770,971 $ 526,245 $ — $ — $ 1,297,216 
 
 Other Assets 
 Equity investment $ — $ — $ 71,059 $ — $ 71,059 
 Exchange stock 2,376 — — — 2,376 
 $ 2,376 $ — $ 71,059 $ — $ 73,435 
 
 Receivables from broker dealers and clearing organizations: 
 Interest rate swap $ — $ 81,141 $ — $ — $ 81,141 
 
 Liabilities 
 Financial instruments sold, not yet purchased, at fair value: 
 Equity securities $ 1,495,283 $ 1,428,486 $ — $ — $ 2,923,769 
 U.S. and Non-U.S. government obligations 55,665 1,581,936 — — 1,637,601 
 Corporate Bonds — 1,202,295 — — 1,202,295 
 Exchange traded notes 7 44,682 — — 44,689 
 Currency forwards — 657,348 ( 657,348 ) — 
 Options 4,533 — 4,533 
 $ 1,555,488 $ 4,914,747 $ — $ ( 657,348 ) $ 5,812,887 
 
 21 

 Fair value measurements for those items measured on a recurring basis are summarized below as of December 31, 2022: 
 
 December 31, 2022 
 (in thousands) Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Counterparty and Cash Collateral Netting Total Fair Value 
 Assets 
 Financial instruments owned, at fair value: 
 Equity securities $ 461,487 $ 1,545,116 $ — $ — $ 2,006,603 
 U.S. and Non-U.S. government obligations 251,708 575,946 — — 827,654 
 Corporate Bonds — 803,880 — — 803,880 
 Exchange traded notes 51 16,777 — — 16,828 
 Currency forwards — 500,553 — ( 493,237 ) 7,316 
 Options 5,200 — — — 5,200 
 $ 718,446 $ 3,442,272 $ — $ ( 493,237 ) $ 3,667,481 
 Financial instruments owned, pledged as collateral: 
 Equity securities $ 552,641 $ 404,802 $ — $ — $ 957,443 
 
 Exchange traded notes 6 5,622 — — 5,628 
 $ 552,647 $ 410,424 $ — $ — $ 963,071 
 Other Assets 
 Equity investment $ — $ — $ 76,613 $ — $ 76,613 
 Exchange stock 2,352 — — — 2,352 
 
 $ 2,352 $ — $ 76,613 $ — $ 78,965 
 
 Receivables from broker dealers and clearing organizations: 
 Interest rate swap — 87,268 — — 87,268 
 
 Liabilities 
 Financial instruments sold, not yet purchased, at fair value: 
 Equity securities $ 1,146,701 $ 1,016,893 $ — $ — $ 2,163,594 
 U.S. and Non-U.S. government obligations 147,418 690,480 — — 837,898 
 Corporate Bonds — 1,183,394 — — 1,183,394 
 Exchange traded notes — 8,199 — — 8,199 
 Currency forwards — 497,799 — ( 497,799 ) — 
 Options 3,889 — — — 3,889 
 $ 1,298,008 $ 3,396,765 $ — $ ( 497,799 ) $ 4,196,974 
 
 JNX Investment 
 
 The Company has a minority investment (the “JNX Investment”) in Japannext Co., Ltd. (“JNX”), formerly known as SBI Japannext Co., Ltd., a proprietary trading system based in Tokyo. In connection with the JNX Investment, the Company issued the SBI Bonds (as described in Note 8 "Borrowings") and used the proceeds to partially finance the transaction. The JNX Investment is included within Level 3 of the fair value hierarchy. As of June 30, 2023 and December 31, 2022, the fair value of the JNX Investment was determined using a weighted average of valuations using 1) the discounted cash flow method, an income approach; 2) a market approach based on average enterprise value/EBITDA ratios of comparable companies; and to a lesser extent 3) a transaction approach based on transaction values of comparable companies. The fair value measurement is highly sensitive to significant changes in the unobservable inputs, and significant increases (decreases) in discount rate or decreases (increases) in enterprise value/EBITDA multiples would result in a significantly lower (higher) fair value measurement. 
 
 22 

 The table below presents information on the valuation techniques, significant unobservable inputs and their ranges for the JNX Investment: 
 
 June 30, 2023 
 (in thousands) Fair Value Valuation Technique Significant Unobservable Input Range Weighted Average 
 
 Equity investment $ 71,059 Discounted cash flow Estimated revenue growth 0.8 % - 6.4 % 
 4.1 % 
 Discount rate 15.5 % - 15.5 % 
 15.5 % 
 Market Future enterprise value/ EBIDTA ratio 7.4 x - 18.3 x 
 11.4 x 
 
 December 31, 2022 
 (in thousands) Fair Value Valuation Technique Significant Unobservable Input Range Weighted Average 
 
 Equity investment $ 76,613 Discounted cash flow Estimated revenue growth ( 5.7 )% - 5.0 % 
 3.1 % 
 Discount rate 15.5 % - 15.5 % 
 15.5 % 
 Market Future enterprise value/ EBIDTA ratio ( 1.2 )x - 18.1 x 
 12.2 x 
 
 Changes in the fair value of the JNX Investment are included within Other, net in the Consolidated Statements of Comprehensive Income. 
 
 The following presents the changes in the Company's Level 3 financial instruments measured at fair value on a recurring basis: 
 
 Three Months Ended June 30, 2023 
 (in thousands) Balance at March 31, 2023 Purchases Total Realized and Unrealized Gains / (Losses) (1) Net Transfers into (out of) Level 3 Settlement Balance at June 30, 2023 Change in Net Unrealized Gains / (Losses) on Investments still held at June 30, 2023 
 Assets 
 Other assets: 
 Equity investment $ 79,726 $ — $ ( 8,667 ) $ — $ — $ 71,059 $ ( 8,667 ) 
 
 Total $ 79,726 $ — $ ( 8,667 ) $ — $ — $ 71,059 $ ( 8,667 ) 
 (1) Total realized and unrealized gains/(losses) includes gains and losses due to fluctuations in currency rates as well as gains and losses recognized on changes in the fair value of the JNX Investment. 
 
 Three Months Ended June 30, 2022 
 (in thousands) Balance at March 31, 2022 Purchases Total Realized and Unrealized Gains / (Losses) (1) Net Transfers into (out of) Level 3 Settlement Balance at June 30, 2022 Change in Net Unrealized Gains / (Losses) on Investments still held at June 30, 2022 
 Assets 
 Other assets: 
 Equity investment $ 84,482 $ — $ ( 6,920 ) $ — $ — $ 77,562 $ ( 6,920 ) 
 
 Total $ 84,482 $ — $ ( 6,920 ) $ — $ — $ 77,562 $ ( 6,920 ) 
 (1) Total realized and unrealized gains/(losses) includes gains and losses due to fluctuations in currency rates as well as gains and losses recognized on changes in the fair value of the JNX Investment. 
 
 23 

 Six Months Ended June 30, 2023 
 (in thousands) Balance at December 31, 2022 Purchases Total Realized and Unrealized Gains / (Losses) (1) Net Transfers into (out of) Level 3 Settlement Balance at June 30, 2023 Change in Net Unrealized Gains / (Losses) on Investments still held at June 30, 2023 
 Assets 
 Other assets: 
 Equity investment $ 76,613 $ — $ ( 5,554 ) $ — $ — $ 71,059 $ ( 5,554 ) 
 
 Total $ 76,613 $ — $ ( 5,554 ) $ — $ — $ 71,059 $ ( 5,554 ) 
 (1) Total realized and unrealized gains/(losses) includes gains and losses due to fluctuations in currency rates as well as gains and losses recognized on changes in the fair value of the JNX Investment. 
 
 Six Months Ended June 30, 2022 
 (in thousands) Balance at December 31, 2021 Purchases Total Realized and Unrealized Gains / (Losses) (1) Net Transfers into (out of) Level 3 Settlement Balance at June 30, 2022 Change in Net Unrealized Gains / (Losses) on Investments still held at June 30, 2022 
 Assets 
 Other assets: 
 Equity investment $ 81,358 $ — $ ( 3,796 ) $ — $ — $ 77,562 $ ( 3,796 ) 
 
 Total $ 81,358 $ — $ ( 3,796 ) $ — $ — $ 77,562 $ ( 3,796 ) 
 (1) Total realized and unrealized gains/(losses) includes gains and losses due to fluctuations in currency rates as well as gains and losses recognized on changes in the fair value of the JNX Investment. 

 Financial Instruments Not Measured at Fair Value 
 
 The table below presents the carrying value, fair value and fair value hierarchy category of certain financial instruments that are not measured at fair value on the Condensed Consolidated Statements of Financial Condition. The table below excludes non-financial assets and liabilities. The carrying value of financial instruments not measured at fair value categorized in the fair value hierarchy as Level 1 and Level 2 approximates fair value due to the relatively short-term nature of the underlying assets. The fair value of the Company’s long-term borrowings is based on quoted prices from the market for similar instruments, and is categorized as Level 2 in the fair value hierarchy. 
 
 24 

 The table below summarizes financial assets and liabilities not carried at fair value on a recurring basis as of June 30, 2023: 
 
 June 30, 2023 
 Carrying Value Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs 
 (in thousands) 
 Fair Value (Level 1) (Level 2) (Level 3) 
 Assets 
 Cash and cash equivalents $ 698,674 $ 698,674 $ 698,674 $ — $ — 
 Cash restricted or segregated under regulations and other 47,133 47,133 47,133 — — 
 Securities borrowed 1,665,179 1,665,179 — 1,665,179 — 
 Securities purchased under agreements to resell 793,815 793,815 — 793,815 — 
 Receivables from broker-dealers and clearing organizations 1,378,685 1,378,685 — 1,378,685 — 
 Receivables from customers 130,623 130,623 — 130,623 — 
 Other assets (1) 32,967 32,967 11,758 21,209 — 
 Total Assets $ 4,747,076 $ 4,747,076 $ 757,565 $ 3,989,511 $ — 
 
 Liabilities 
 Short-term borrowings $ 111,721 $ 115,000 $ — $ 115,000 $ — 
 Long-term borrowings 1,778,270 1,801,798 — 1,801,798 — 
 Securities loaned 1,306,894 1,306,894 — 1,306,894 — 
 Securities sold under agreements to repurchase 1,120,151 1,120,151 — 1,120,151 — 
 Payables to broker-dealers and clearing organizations 848,277 848,277 — 848,277 — 
 Payables to customers 39,740 39,740 — 39,740 — 
 Other liabilities (2) 24,255 24,255 — 24,255 — 
 Total Liabilities $ 5,229,308 $ 5,256,115 $ — $ 5,256,115 $ — 
 (1) Includes cash collateral and deposits, and interest and dividends receivables. 
 
 (2) Includes deposits, interest and dividends payable. 

 25 

 The table below summarizes financial assets and liabilities not carried at fair value on a recurring basis as of December 31, 2022: 
 
 December 31, 2022 
 Carrying Value Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs 
 (in thousands) 
 Fair Value (Level 1) (Level 2) (Level 3) 
 Assets 
 Cash and cash equivalents $ 981,580 $ 981,580 $ 981,580 $ — $ — 
 Cash restricted or segregated under regulations and other 56,662 56,662 56,662 — — 
 Securities borrowed 1,187,674 1,187,674 — 1,187,674 — 
 Securities purchased under agreements to resell 336,999 336,999 — 336,999 — 
 Receivables from broker-dealers and clearing organizations 1,027,917 1,027,917 — 1,027,917 — 
 Receivables from customers 80,830 80,830 — 80,830 — 
 Other assets (1) 30,579 30,579 — 30,579 — 
 Total Assets $ 3,702,241 $ 3,702,241 $ 1,038,242 $ 2,663,999 $ — 
 
 Liabilities 
 Short-term borrowings 3,944 3,944 — 3,944 — 
 Long-term borrowings 1,795,952 1,783,943 — 1,783,943 — 
 Securities loaned 1,060,432 1,060,432 — 1,060,432 — 
 Securities sold under agreements to repurchase 627,549 627,549 — 627,549 — 
 Payables to broker dealer and clearing organizations 273,843 273,843 — 273,843 — 
 Payables to customers 46,525 46,525 — 46,525 — 
 Other liabilities (2) 23,776 23,776 — 23,776 — 
 Total Liabilities $ 3,832,021 $ 3,820,012 $ — $ 3,820,012 $ — 
 (1) Includes cash collateral and deposits, and interest and dividends receivables. 
 (2) Includes deposits, interest and dividends payable. 
 
 Offsetting of Financial Assets and Liabilities 
 
 The Company does not net securities borrowed and securities loaned, or securities purchased under agreements to resell and securities sold under agreements to repurchase. These financial instruments are presented on a gross basis in the Condensed Consolidated Statements of Financial Condition. In the tables below, the amounts of financial instruments owned that are not offset in the Condensed Consolidated Statements of Financial Condition, but could be netted against financial liabilities with specific counterparties under legally enforceable master netting agreements in the event of default, are presented to provide financial statement readers with the Company’s estimate of its net exposure to counterparties for these financial instruments. 
 
 26 

 The following tables set forth the gross and net presentation of certain financial assets and financial liabilities as of June 30, 2023 and December 31, 2022: 
 
 June 30, 2023 
 Gross Amounts of Recognized Assets Amounts Offset in the Condensed Consolidated Statement of Financial Condition Net Amounts of Assets Presented in the Condensed Consolidated Statements of Financial Condition Amounts Not Offset in the Condensed Consolidated Statements of Financial Condition 
 
 (in thousands) Financial Instrument Collateral Counterparty Netting/ Cash Collateral Net Amount 
 Offsetting of Financial Assets: 
 Securities borrowed $ 1,665,179 $ — $ 1,665,179 $ ( 1,631,134 ) $ ( 6,261 ) $ 27,784 
 Securities purchased under agreements to resell 793,815 — 793,815 ( 793,815 ) — — 
 Receivables from broker-dealers and clearing organizations: 
 Interest rate swaps 81,141 — 81,141 — — 81,141 
 Trading assets, at fair value: 
 Currency forwards 611,584 ( 603,560 ) 8,024 — — 8,024 
 Options 4,316 — 4,316 — ( 3,978 ) 338 
 Total $ 3,156,035 $ ( 603,560 ) $ 2,552,475 $ ( 2,424,949 ) $ ( 10,239 ) $ 117,287 

 Gross Amounts of Recognized Liabilities Amounts Offset in the Condensed Consolidated Statement of Financial Condition Net Amounts of Liabilities Presented in the Consolidated Statement of Financial Condition Amounts Not Offset in the Condensed Consolidated Statements of Financial Condition 
 
 (in thousands) Financial Instruments Counterparty Netting/ Cash Collateral Net Amount 
 Offsetting of Financial Liabilities: 
 Securities loaned $ 1,306,894 $ — $ 1,306,894 $ ( 1,287,973 ) $ ( 6,614 ) $ 12,307 
 Securities sold under agreements to repurchase 1,120,151 — 1,120,151 ( 1,120,151 ) — — 
 
 Trading liabilities, at fair value: 
 Currency forwards 657,348 ( 657,348 ) — — — — 
 Options 4,533 — 4,533 — ( 3,978 ) 555 
 Total $ 3,088,926 $ ( 657,348 ) $ 2,431,578 $ ( 2,408,124 ) $ ( 10,592 ) $ 12,862 

 December 31, 2022 
 Gross Amounts of Recognized Assets Amounts Offset in the Condensed Consolidated Statement of Financial Condition Net Amounts of Assets Presented in the Condensed Consolidated Statements of Financial Condition Amounts Not Offset in the Condensed Consolidated Statements of Financial Condition 
 
 (in thousands) Financial Instrument Collateral Counterparty Netting/ Cash Collateral Net Amount 
 Offsetting of Financial Assets: 
 Securities borrowed $ 1,187,674 $ — $ 1,187,674 $ ( 1,148,238 ) $ ( 5,138 ) $ 34,298 
 Securities purchased under agreements to resell 336,999 — 336,999 ( 336,849 ) — 150 
 Receivables from broker-dealers and clearing organizations 
 Interest rate swaps 87,268 — 87,268 — — 87,268 
 Trading assets, at fair value: 
 Currency forwards 500,553 ( 493,237 ) 7,316 — — 7,316 
 Options 5,200 — 5,200 — ( 3,889 ) 1,311 
 Total $ 2,117,694 $ ( 493,237 ) $ 1,624,457 $ ( 1,485,087 ) $ ( 9,027 ) $ 130,343 

 27 

 Gross Amounts of Recognized Assets Amounts Offset in the Condensed Consolidated Statement of Financial Condition Net Amounts of Liabilities Presented in the Consolidated Statement of Financial Condition Amounts Not Offset in the Condensed Consolidated Statements of Financial Condition 
 
 (in thousands) Financial Instrument Collateral Counterparty Netting/ Cash Collateral Net Amount 
 Offsetting of Financial Liabilities: 
 Securities loaned $ 1,060,432 $ — $ 1,060,432 $ ( 1,027,062 ) $ ( 9,100 ) $ 24,270 
 Securities sold under agreements to repurchase 627,549 — 627,549 ( 627,388 ) — 161 
 
 Trading liabilities, at fair value: 
 Currency forwards 497,799 ( 497,799 ) — — — — 
 Options 3,889 — 3,889 — ( 3,889 ) — 
 Total $ 2,189,669 $ ( 497,799 ) $ 1,691,870 $ ( 1,654,450 ) $ ( 12,989 ) $ 24,431 

 The following table presents gross obligations for securities sold under agreements to repurchase and for securities lending transactions by remaining contractual maturity and the class of collateral pledged as of June 30, 2023 and December 31, 2022: 
 
 June 30, 2023 
 Remaining Contractual Maturity 
 (in thousands) Overnight and Continuous Less than 30 days 30 - 60
days 61 - 90
Days Greater than 90
days Total 
 
 Securities sold under agreements to repurchase: 
 Equity securities $ — $ 140,000 $ 150,000 $ 110,000 $ — $ 400,000 
 U.S. and Non-U.S. government obligations 720,151 — — — 720,151 
 Total $ 720,151 $ 140,000 $ 150,000 $ 110,000 $ — $ 1,120,151 
 
 Securities loaned: 
 Equity securities $ 1,306,894 $ — $ — $ — $ — $ 1,306,894 
 Total $ 1,306,894 $ — $ — $ — $ — $ 1,306,894 

 December 31, 2022 
 Remaining Contractual Maturity 
 (in thousands) Overnight and Continuous Less than 30 days 30 - 60
days 61 - 90
Days Greater than 90
days Total 
 
 Securities sold under agreements to repurchase: 
 Equity securities $ — $ 250,000 $ 100,000 $ 50,000 $ — $ 400,000 
 U.S. and Non-U.S. government obligations 227,549 — — — — 227,549 
 Total $ 227,549 $ 250,000 $ 100,000 $ 50,000 $ — $ 627,549 
 
 Securities loaned: 
 Equity securities 1,060,432 — — — — 1,060,432 
 Total $ 1,060,432 $ — $ — $ — $ — $ 1,060,432 

 28 

 10. Derivative Instruments 
 
 The fair value of the Company’s derivative instruments on a gross basis consisted of the following at June 30, 2023 and December 31, 2022: 
 
 (in thousands) June 30, 2023 December 31, 2022 
 Derivatives Assets Financial Statement Location Fair Value Notional Fair Value Notional 
 Derivative instruments not designated as hedging instruments: 
 Equities futures Receivables from broker-dealers and clearing organizations $ ( 304 ) $ 774,998 $ ( 575 ) $ 663,110 
 Commodity futures Receivables from broker-dealers and clearing organizations ( 3,636 ) 5,706,595 ( 31,007 ) 7,597,057 
 Currency futures Receivables from broker-dealers and clearing organizations ( 8,169 ) 3,226,865 ( 24,023 ) 7,460,531 
 Fixed income futures Receivables from broker-dealers and clearing organizations 9 24,469 ( 360 ) 30,292 
 
 Options Financial instruments owned 4,316 1,288,736 5,200 691,737 
 Currency forwards Financial instruments owned 611,584 44,930,685 500,553 30,286,330 
 
 Derivative instruments designated as hedging instruments: 
 Interest rate swap Receivables from broker-dealers and clearing organizations 81,141 1,525,000 87,268 1,525,000 
 
 Derivatives Liabilities Financial Statement Location Fair Value Notional Fair Value Notional 
 Derivative instruments not designated as hedging instruments: 
 Equities futures Payables to broker-dealers and clearing organizations $ ( 951 ) $ 1,303,263 $ 1,819 $ 3,238,651 
 Commodity futures Payables to broker-dealers and clearing organizations 358 35,234 597 39,046 
 Currency futures Payables to broker-dealers and clearing organizations ( 3,252 ) 566,817 8 6,386 
 Fixed income futures Payables to broker-dealers and clearing organizations ( 136 ) 149,069 ( 264 ) 123,043 
 Options Financial instruments sold, not yet purchased 4,533 1,245,988 3,889 742,531 
 Currency forwards Financial instruments sold, not yet purchased 657,348 44,953,567 497,799 30,284,952 
 
 Amounts included in receivables from and payables to broker-dealers and clearing organizations represent net variation margin on long and short futures contracts as well as amounts receivable or payable on interest rate swaps. 
 
 The following table summarizes the net gain (loss) from derivative instruments not designated as hedging instruments under ASC 815, which are recorded in total revenues, and from those designated as hedging instruments under ASC 815, which are initially recorded in other comprehensive income in the accompanying Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2023 and 2022. 
 29 

 Three Months Ended June 30, Six Months Ended June 30, 
 (in thousands) Financial Statements Location 2023 2022 2023 2022 
 Derivative instruments not designated as hedging instruments: 
 Futures Trading income, net $ ( 4,449 ) $ 118,455 $ 120,017 $ 195,801 
 Currency forwards Trading income, net 16,750 ( 44,665 ) ( 46,187 ) ( 35,754 ) 
 Options Trading income, net ( 1,510 ) 157 1,145 ( 938 ) 
 Interest rate swap on term loan Other, net ( 469 ) ( 469 ) ( 932 ) ( 932 ) 
 $ 10,322 $ 73,478 $ 74,043 $ 158,177 
 
 Derivative instruments designated as hedging instruments: 
 Interest rate swaps (1) Other comprehensive income $ 9,514 $ 16,430 $ ( 5,879 ) $ 72,575 
 
 $ 9,514 $ 16,430 $ ( 5,879 ) $ 72,575 

 (1) The Company entered into a five-year $ 1,000 million floating-to-fixed interest rate swap agreement in the first quarter of 2020 and a five-year $ 525 million floating-to-fixed interest rate swap agreement in the fourth quarter of 2019. These two interest rate swaps met the criteria to be considered qualifying cash flow hedges under ASC 815 in the first quarter of 2020, and as such, the mark-to-market gains (losses) on the instruments were deferred within Other comprehensive income on the Condensed Consolidated Statements of Comprehensive Income beginning in the first quarter of 2020. 
 
 11. Variable Interest Entities 
 
 A variable interest entity (“VIE”) is an entity that lacks one or more of the following characteristics: (i) the total equity investment at risk is sufficient to enable the entity to finance its activities independently and (ii) the equity holders have the power to direct the activities of the entity that most significantly impact its economic performance, the obligation to absorb the losses of the entity and the right to receive the residual returns of the entity. 
 
 The Company will be considered to have a controlling financial interest and will consolidate a VIE if it has both (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. 
 
 The Company has interests in two joint ventures (“JV”) that build and maintain microwave communication networks in the U.S., Europe, and Asia. The Company and its JV partners each pay monthly fees for the use of the microwave communication networks in connection with their respective trading activities, and the JVs may sell excess bandwidth that is not utilized by the JV members to third parties. As of June 30, 2023, the Company held noncontrolling interests of 11.1 % and 50.0 %, respectively, in these JVs. 
 
 The Company has an interest in a JV that offers derivatives trading technology and execution services to broker-dealers, professional traders and select hedge funds. As of June 30, 2023, the Company held approximately a 9.8 % noncontrolling interest in this JV. 
 
 The Company has an interest in a JV that operates a member-owned equities exchange with the goal of increasing competition and transparency, while reducing fixed costs and simplifying execution of equity trading in the U.S. As of June 30, 2023, the Company held approximately a 14.2 % noncontrolling interest in this JV. 
 
 In the second quarter of 2022, the Company invested in a JV that was formed for the purpose of developing and operating a cryptocurrency trading platform with the goal of increasing competition and transparency, while improving trading performance and reducing operational risk. As of June 30, 2023, the Company held approximately a 9.3 % noncontrolling interest in this JV. 
 
 The Company's five JVs noted above meet the criteria to be considered VIEs, which it does not consolidate. The Company records its interest in each JV under the equity method of accounting and records its investment in the JVs within Other assets and its amounts payable for communication services provided by the applicable JVs within Accounts payable, accrued expenses and other liabilities on the Statements of Financial Condition. The Company records its pro-rata share of each JV's earnings or losses within Other, net and fees related to the use of communication services provided by the JVs within Communications and data processing on the Condensed Consolidated Statements of Comprehensive Income. 
 
 The Company’s exposure to the obligations of these VIEs is generally limited to its interests in each respective JV, which is the carrying value of the equity investment in each JV. 
 30 

 The following table presents the Company’s nonconsolidated VIEs at June 30, 2023: 
 
 Carrying Amount Maximum Exposure to Loss VIEs' assets 
 (in thousands) Asset Liability 
 Equity investment $ 50,939 $ — $ 50,939 $ 264,860 

 The following table presents the Company’s nonconsolidated VIEs at December 31, 2022: 
 
 Carrying Amount Maximum Exposure to Loss VIEs' assets 
 (in thousands) Asset Liability 
 Equity investment $ 43,589 $ — $ 43,589 $ 239,682 

 During the second quarter of 2022, the Company formed a JV to support the growth and expansion of a multi-asset request-for-quote communication platform. As of June 30, 2023, the Company held a 51 % controlling interest in this entity. This JV meets the criteria to be considered a VIE, and based on the standard for control set forth above, the Company consolidates this entity and records the interest that the Company does not own as noncontrolling interest in the Condensed Consolidated Financial Statements. 
 
 12. Revenues from Contracts with Customers 
 
 For more information on revenue recognition and the nature of services provided, see Note 2 "Summary of Significant Accounting Policies" and Note 13 "Revenues from Contracts with Customers" to the Consolidated Financial Statements of the Company's 2022 Annual Report on Form 10-K. 
 
 Disaggregation of Revenues 
 
 The following tables present the Company’s revenue from contracts with customers disaggregated by service, and timing of revenue recognition, reconciled to the Company’s segments, for the three and six months ended June 30, 2023, and 2022: 
 
 Three Months Ended June 30, 2023 
 (in thousands) Market Making Execution Services Corporate Total 
 Revenues from contracts with customers: 
 Commissions, net $ 6,634 $ 69,993 $ — $ 76,627 
 
 Workflow technology — 22,576 — 22,576 
 Analytics — 10,301 — 10,301 
 Total revenue from contracts with customers 6,634 102,870 — 109,504 
 
 Other sources of revenue 398,616 6,246 ( 7,512 ) 397,350 
 
 Total revenues $ 405,250 $ 109,116 $ ( 7,512 ) $ 506,854 
 
 Timing of revenue recognition: 
 Services transferred at a point in time $ 405,250 $ 90,940 $ ( 7,512 ) $ 488,678 
 Services transferred over time — 18,176 — 18,176 
 Total revenues $ 405,250 $ 109,116 $ ( 7,512 ) $ 506,854 

 31 

 Three Months Ended June 30, 2022 
 (in thousands) Market Making Execution Services Corporate Total 
 Revenues from contracts with customers: 
 Commissions, net $ 11,145 $ 90,998 $ — $ 102,143 
 Workflow technology — 24,334 — 24,334 
 
 Analytics — 9,863 — 9,863 
 Total revenue from contracts with customers 11,145 125,195 — 136,340 
 
 Other sources of revenue 421,450 5,802 41,146 468,398 
 
 Total revenues $ 432,595 $ 130,997 $ 41,146 $ 604,738 
 
 Timing of revenue recognition: 
 Services transferred at a point in time $ 432,595 $ 112,989 $ 41,146 $ 586,730 
 Services transferred over time — 18,008 — 18,008 
 Total revenues $ 432,595 $ 130,997 $ 41,146 $ 604,738 

 Six Months Ended June 30, 2023 
 (in thousands) Market Making Execution Services Corporate Total 
 Revenues from contracts with customers: 
 Commissions, net $ 16,334 $ 147,251 $ — $ 163,585 
 
 Workflow technology — 47,532 — 47,532 
 Analytics — 19,831 — 19,831 
 Total revenue from contracts with customers 16,334 214,614 — 230,948 
 
 Other sources of revenue 887,835 12,979 ( 4,529 ) 896,285 
 
 Total revenues $ 904,169 $ 227,593 $ ( 4,529 ) $ 1,127,233 
 
 Timing of revenue recognition: 
 Services transferred at a point in time $ 904,169 $ 191,419 $ ( 4,529 ) $ 1,091,059 
 Services transferred over time — 36,174 — 36,174 
 Total revenues $ 904,169 $ 227,593 $ ( 4,529 ) $ 1,127,233 

 Six Months Ended June 30, 2022 
 (in thousands) Market Making Execution Services Corporate Total 
 Revenues from contracts with customers: 
 Commissions, net $ 20,194 $ 199,187 $ — $ 219,381 
 
 Workflow technology — 51,270 — 51,270 
 Analytics — 20,344 20,344 
 Total revenue from contracts with customers 20,194 270,801 — 290,995 
 
 Other sources of revenue 958,964 11,941 44,100 1,015,005 
 
 Total revenues $ 979,158 $ 282,742 $ 44,100 $ 1,306,000 
 
 Timing of revenue recognition: 
 Services transferred at a point in time $ 979,158 $ 246,303 $ 44,100 $ 1,269,561 
 Services transferred over time — 36,439 — 36,439 
 Total revenues $ 979,158 $ 282,742 $ 44,100 $ 1,306,000 

 32 

 Remaining Performance Obligations and Revenue Recognized from Past Performance Obligations 
 
 As of June 30, 2023 and 2022, the aggregate amount of the transaction price allocated to the performance obligations relating to workflow technology and analytics revenues that are unsatisfied (or partially unsatisfied) was not material. 
 
 Contract Assets and Contract Liabilities 
 
 The timing of the revenue recognition may differ from the timing of payment from customers. The Company records a receivable when revenue is recognized prior to payment, and when the Company has an unconditional right to payment. The Company records a contract liability when payment is received prior to the time at which the satisfaction of the service obligation occurs. 
 
 Receivables related to revenues from contracts with customers amounted to $ 55.8 million and $ 56.1 million as of June 30, 2023 and December 31, 2022, respectively. The Company did not identify any contract assets. There were no impairment losses on receivables as of June 30, 2023. 
 
 Deferred revenue primarily relates to deferred commissions allocated to analytics products and subscription fees billed in advance of satisfying the performance obligations. Deferred revenue related to contracts with customers was $ 14.0 million and $ 9.6 million as of June 30, 2023 and December 31, 2022, respectively. The Company recognized the full amount of revenue during the six months ended June 30, 2023 and 2022, that had been recorded as deferred revenue in the respective prior year. 
 
 The Company has not identified any costs to obtain or fulfill its contracts under ASC 606. 
 
 13. Income Taxes 
 
 The Company is subject to U.S. federal, state and local income tax at the rate applicable to corporations less the rate attributable to the noncontrolling interest in Virtu Financial. These noncontrolling interests are subject to U.S. taxation as partnerships. Accordingly, for the three and six months ended June 30, 2023 and 2022, the income attributable to these noncontrolling interests was reported in the Condensed Consolidated Statements of Comprehensive Income, but the related U.S. income tax expense attributable to these noncontrolling interests was not reported by the Company as it is the obligation of the individual partners. The Company’s non-U.S. subsidiaries are subject to foreign income taxes in the jurisdictions in which they operate. The Company’s provisions for income taxes and effective tax rates were $ 5.9 million, and 16.7 %, and $ 24.9 million, and 14.3 % for the three months ended June 30, 2023 and 2022, respectively and $ 30.6 million, and 18.0 %, and $ 66.7 million, and 16.0 % for the six months ended June 30, 2023 and 2022, respectively. Income tax expense is also affected by the differing effective tax rates in foreign, state and local jurisdictions where certain of the Company’s subsidiaries are subject to corporate taxation. 
 
 Included in Other assets on the Condensed Consolidated Statements of Financial Condition at June 30, 2023 and December 31, 2022 are current income tax receivables of $ 48.3 million and $ 54.1 million, respectively. The balances at June 30, 2023 and December 31, 2022 primarily comprised income tax benefits due to the Company from federal, state, local, and foreign tax jurisdictions based on income before taxes. Included in Accounts payable, accrued expenses and other liabilities on the Condensed Consolidated Statements of Financial Condition at June 30, 2023 and December 31, 2022 are current tax liabilities of $ 9.3 million and $ 13.4 million, respectively. The balances at June 30, 2023 and December 31, 2022 primarily comprise income taxes owed to federal, state and local, and foreign tax jurisdictions based on income before taxes. 
 
 Deferred income taxes arise primarily due to the amortization of the deferred tax assets recognized in connection with the IPO (see Note 4 "Tax Receivable Agreements"), the Acquisition of KCG and the ITG Acquisition, differences in the valuation of financial assets and liabilities, and other temporary differences arising from the deductibility of compensation, depreciation, and other expenses in different time periods for book and income tax return purposes. 
 
 33 

 There are no expiration dates on the deferred tax assets. The provisions of ASC 740 require that carrying amounts of deferred tax assets be reduced by a valuation allowance if, based on the available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Accordingly, the need to establish valuation allowances for deferred tax assets is assessed periodically with appropriate consideration given to all positive and negative evidence related to the realization of the deferred tax assets. At June 30, 2023 and December 31, 2022, the Company did not have any U.S. federal net operating loss carryforwards and therefore the Company did not record a deferred tax asset related to federal net operating loss carryforwards. At June 30, 2023 and December 31, 2022, the Company recorded deferred income taxes related to state and local net operating losses of $ 0.4 million. These net operating losses will begin to expire in 2039. The Company did not record a valuation allowance against this deferred tax asset. 
 
 As a result of the ITG Acquisition, the Company had non-U.S. net operating losses of $ 66.9 million and $ 64.6 million at June 30, 2023 and December 31, 2022, respectively, and recorded a related deferred tax asset of $ 12.8 million and $ 12.4 million, respectively. A valuation allowance of $ 12.8 million and $ 12.4 million was recorded against this deferred tax asset at June 30, 2023 and December 31, 2022, respectively as it is more likely than not that a substantial portion of this deferred tax asset will not be realized. As a result of the Acquisition of KCG, the Company had non-U.S. net operating losses at June 30, 2023 and December 31, 2022 of $ 239.3 million, and recorded a related deferred tax asset of $ 44.9 million in both years. A full valuation allowance was also recorded against this deferred tax asset at both June 30, 2023 and December 31, 2022 as it is more likely than not that this deferred tax asset will not be realized. 
 
 No valuation allowance against the remaining deferred taxes was recorded as of June 30, 2023 and December 31, 2022 because it is more likely than not that these deferred tax assets will be fully realized. 
 
 The Company is subject to taxation in U.S. federal, state, local and foreign jurisdictions. As of June 30, 2023, the Company’s tax years for 2015 through 2021 and 2016 through 2021 were subject to examination by U.S. and non-U.S. tax authorities, respectively. As a result of the ITG Acquisition and the Acquisition of KCG, the Company assumed any ITG and KCG tax exposures. In addition, the Company is subject to state and local income tax examinations in various jurisdictions for the tax years 2013 through 2021. The final outcome of these examinations is not yet determinable. However, the Company anticipates that adjustments related to these examinations, if any, will not result in a material change to its financial condition, results of operations and cash flows. 
 
 The Company’s policy for recording interest and penalties associated with audits is to record such items as a component of income or loss before income taxes and noncontrolling interest. Penalties, if any, are recorded in Operations and administrative expense and interest received or paid is recorded in Other, net or Operations and administrative expense in the Condensed Consolidated Statements of Comprehensive Income, respectively. 
 
 The Company had $ 6.8 million of unrecognized tax benefits as of June 30, 2023, all of which would affect the Company’s effective tax rate if recognized. The Company has determined that there are no uncertain tax positions that would have a material impact on the Company’s financial position as of June 30, 2023. 
 
 14. Commitments, Contingencies and Guarantees 
 
 Legal and Regulatory Proceedings 
 
 In the ordinary course of business, the nature of the Company’s business subjects it to claims, lawsuits, regulatory examinations or investigations and other proceedings, any of which could result in the imposition of fines, penalties or other sanctions against the Company. The Company and its subsidiaries are subject to several of these matters at the present time, including, among others, a matter in which the Company has been responding to requests for information from the U.S. Securities and Exchange Commission in connection with an investigation of aspects of the Company’s internal information access barriers. The Company has continued to cooperate with this civil investigation and engaged in settlement discussions. The Company has been unable to reach a settlement and, consistent with its previous disclosure, has received a Wells Notice from the SEC, to which it has responded. The Company expects the SEC to file an action against the Company alleging violations of federal securities laws with respect to the Company’s information barriers policies and procedures for a specified time period in and around January 2018 to April 2019 and related statements made by the Company during such period. The Company believes it would have meritorious defenses in the event of such an action and intends to defend itself vigorously. Specifically, the Company would plan to assert, among other defenses, that it maintained reasonable policies, procedures and controls to protect data during the period consistent with applicable law, that related statements made to clients and investors were true and accurate, and that the statute of limitations has expired with respect to certain claims. 
 
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 In a matter related to the SEC investigation noted above, on May 19, 2023, the Company and certain of its current and former executive officers were named as defendants in Hiebert v. Virtu Financial, Inc., No. 23-cv-03770. The complaint was filed by a purported stockholder in the Eastern District of New York on behalf of a putative class and asserts that the Company made materially false and misleading statements and omissions in its public filings in violation of federal securities laws. The Company also received a request for information pursuant to Section 220 of the Delaware General Corporation Law from counsel for a purported stockholder. The Company believes it has meritorious defenses against pending or contemplated claims that its public disclosures in relation to the SEC investigation were inadequate or misleading. The Company maintains that such disclosures were true and accurate and compliant with applicable law and will defend itself vigorously. 
 
 On November 30, 2020, the Company was named as a defendant in In re United States Oil Fund, LP Securities Litigation , No. 20-cv-4740. The consolidated amended complaint was filed in federal district court in New York on behalf of a putative class, and asserts claims against the Company and numerous other financial institutions under Section 11 of the Securities Act of 1933 in connection with trading in United States Oil Fund, LP, a crude oil ETF. The complaint also names the ETF, its sponsor, and related individuals as defendants. The complaint did not specify the amount of alleged damages. Defendants moved to dismiss the consolidated amended complaint on January 29, 2021; the motion is fully briefed and pending before the court. The Company believes that the claims are without merit and is defending itself vigorously. 
 
 On March 7, 2022, the Company was named as a defendant in Iron Workers Local No. 55 Pension Fund v. Virtu Financial, Inc. , No. 2022-0211-PAF pending in the Court of Chancery of the State of Delaware. The complaint, filed by a purported stockholder, seeks to compel the inspection of certain Company books and records pursuant to Section 220 of the Delaware General Corporation Law. The complaint alleges that the stockholder seeks Company information to investigate (a) whether wrongdoing or mismanagement occurred in connection with distributions made to the partners of Virtu Financial pursuant to the Company’s Up-C corporate structure; (b) the independence and disinterestedness of the Company’s directors and/or officers and whether the directors breached their fiduciary duties; and (c) potential damages relating thereto. The Company believes that the claims are without merit and is defending itself vigorously. 
 
 On October 17, 2022, the Company’s subsidiary, along with several other parties, was named as a defendant in Mallinckrodt PLC, et al. (Reorganized Debtors); Opioid Master Disbursement Trust II v. Argos Capital Appreciation Master Fund LP et al No. 20-12522. The complaint alleges that Mallinckrodt PLC engaged in a share repurchase program from 2015 through 2018 pursuant to which it repurchased its own shares in various open market transactions, a period during which it was allegedly insolvent. The plaintiff is seeking to unwind the transactions consummated under the program, alleging such transactions constituted fraudulent transfers by the debtor. The Company believes that the claims are without merit and is defending itself vigorously. 
 
 On December 1, 2022, the Company’s subsidiary, along with several other parties, was named as a defendant in Northwest Biotherapeutics, Inc. v. Canaccord Genuity LLC, et al No. 1:22-cv-10185. The complaint alleges that defendants engaged in market manipulation in the plaintiff’s stock during a period from 2018 to 2022. The complaint did not specify the amount of alleged damages. The Company believes that the claims are without merit and is defending itself vigorously. 
 
 Given the inherent difficulty of predicting the outcome of litigation and regulatory matters, particularly in regulatory examinations or investigations or other proceedings in which substantial or indeterminate judgments, settlements, disgorgements, restitution, penalties, injunctions, damages or fines are sought, or where such matters are in the early stages, the Company cannot estimate losses or ranges of losses for such matters where there is only a reasonable possibility that a loss may be incurred, and utilizes its judgment in accordance with applicable accounting standards in booking any associated estimated liability. It is not presently possible to determine the ultimate exposure to these matters and it is possible that the resolution of the outstanding matters will significantly exceed any estimated liabilities accrued by the Company. In addition, there are numerous factors that result in a greater degree of complexity in class-action lawsuits as compared to other types of litigation. There can be no assurance that these various legal proceedings will not significantly exceed any estimated liability accrued by the Company or have a material adverse effect on the Company’s results of operations in any future period, and a material judgment, fine or sanction could have a material adverse impact on the Company’s financial condition, results of operations and cash flows. However, it is the opinion of management, after consultation with legal counsel that, based on information currently available, the ultimate outcome of these matters will not have a material adverse impact on the business, financial condition or operating results of the Company, although they might be material to the operating results for any particular reporting period. The Company carries directors’ and officers’ liability insurance coverage and other insurance coverage for potential claims, including securities actions, against the Company and its respective directors and officers. 
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 Other Legal and Regulatory Matters 
 
 The Company owns subsidiaries including regulated entities that are subject to extensive oversight under federal, state and applicable international laws as well as self-regulatory organization (“SRO”) rules. Changes in market structure and the need to remain competitive require constant changes to the Company's systems, order routing and order handling procedures. The Company makes these changes while continuously endeavoring to comply with many complex laws and rules. Compliance, surveillance and trading issues common in the securities industry are monitored by, reported to, and/or reviewed in the ordinary course of business by the Company's regulators in the U.S. and abroad. As a major order flow execution destination, the Company is named from time to time in, or is asked to respond to a number of regulatory matters brought by U.S. regulators, foreign regulators, SROs, as well as actions brought by private plaintiffs, which arise from its business activities. There has recently been an increased focus by regulators on Anti-Money Laundering and sanctions compliance by broker-dealers and similar entities, as well as an enhanced interest on suspicious activity reporting and transactions involving microcap and low-priced securities. In addition, there has been increased regulatory, congressional and media scrutiny of U.S. equities market structure, the retail trading environment in the U.S., wholesale market making and the relationships between retail broker-dealers and market making firms including, but not limited to, payment for order flow arrangements, other remuneration arrangements such as profit-sharing relationships and exchange fee and rebate structures, alternative trading systems and off-exchange trading more generally, high frequency trading, short selling, market fragmentation, colocation, and access to market data feeds. Specifically, in 2022 the SEC proposed several rule changes focused on equity market structure reform. These proposals include, but are not limited to, (i) Proposed Rule 615 of Regulation NMS, which proposes to dramatically change U.S. equities market structure, the routing, handling and potentially the amount, character and cost of retail order flow, (ii) Regulation Best Execution, which would impose best execution requirements on broker-dealers which would be distinct from, but overlapping with, FINRA’s existing best execution rule (Rule 5310), (iii) proposed rule amendments to minimum pricing increments under Rule 612 or Regulation NMS, access fee caps under Rule 610 of Regulation NMS, acceleration of the implementation of certain Market Data Infrastructure Rules, and amendment to the odd-lot information definition adopted under the MDI rules (collectively referred to as the “tick size, access fees and infostructure rule proposals”), and (iv) amendments to Rule 605 of Regulation NMS, along with a series of amendments to the definition of Exchange and Alternative Trading Systems (ATS), which would expand the scope of exchange and ATS registration and compliance requirements. Further, in 2023, the SEC proposed amendments to expand and update Regulation Systems Compliance and Integrity (SCI) and has indicated that additional rule proposals may be forthcoming. If adopted, these or other potential rule changes could adversely affect the Company’s business or the Company’s industry. As indicated above, from time to time, the Company is the subject of requests for information and documents from the SEC, the Financial Industry Regulatory Authority ("FINRA"), state attorneys general, and other regulators and governmental authorities. It is the Company's practice to cooperate and comply with the requests for information and documents. 
 
 As indicated above, the Company is currently the subject of various regulatory reviews and investigations by state, federal and foreign regulators and SROs, including the SEC and FINRA. In some instances, these matters may result in a disciplinary action and/or a civil or administrative action. 
 
 Representations and Warranties; Indemnification Arrangements 
 
 In the normal course of its operations, the Company enters into contracts that contain a variety of representations and warranties in addition to indemnification obligations, including indemnification obligations in connection with the Acquisition of KCG and the ITG Acquisition. The Company's maximum exposure under these arrangements is currently unknown, as any such exposure could relate to claims not yet brought or events which have not yet occurred. For example, in November 2013, KCG sold Urban Financial of America, LLC (“Urban”), the reverse mortgage origination and securitization business previously owned by Knight Capital Group, Inc., to an investor group now known as Finance of America Reverse, LLC (“FAR”). Pursuant to the terms of the Stock Purchase Agreement between KCG and FAR, Virtu has certain continuing obligations related to KCG's prior ownership of Urban. 
 
 Consistent with standard business practices in the normal course of business, the Company enters into contracts that contain a variety of representations and warranties and general indemnifications. The Company has also provided general indemnifications to its managers, officers, directors, employees, and agents against expenses, legal fees, judgments, fines, settlements, and other amounts actually and reasonably incurred by such persons under certain circumstances as more fully disclosed in its operating agreement. The overall maximum amount of the obligations (if any) cannot reasonably be estimated as it will depend on the facts and circumstances that give rise to any future claims. 
 
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 15. Leases 
 
 The Company primarily enters into lessee arrangements for corporate office space, data centers, and technology equipment. For more information on lease accounting, see Note 2 "Summary of Significant Accounting Policies" and Note 16 "Leases" to the Consolidated Financial Statements of the Company's 2022 Annual Report on Form 10-K 
 
 Lease assets and liabilities are summarized as follows: 
 
 (in thousands) Financial Statement Location June 30, 2023 December 31, 2022 
 Operating leases 
 Operating lease right-of-use assets Operating lease right-of-use assets $ 174,136 $ 187,442 
 Operating lease liabilities Operating lease liabilities 224,086 239,202 
 
 Finance leases 
 Property and equipment, at cost Property, equipment, and capitalized software, net 36,343 27,908 
 Accumulated depreciation Property, equipment, and capitalized software, net ( 12,985 ) ( 12,736 ) 
 Finance lease liabilities Accounts payable, accrued expenses, and other liabilities 23,682 15,323 

 Weighted average remaining lease term and discount rate are as follows: 
 
 June 30, 2023 December 31, 2022 
 Weighted average remaining lease term 
 Operating leases 6.10 years 6.21 years 
 Finance leases 3.1 years 2.84 years 
 Weighted average discount rate 
 Operating leases 5.51 % 5.43 % 
 Finance leases 4.36 % 3.92 % 

 The components of lease expense are as follows: 
 
 Three Months Ended June 30, Six Months Ended June 30, 
 (in thousands) 2023 2022 2023 2022 
 Operating lease cost: 
 Fixed $ 19,487 $ 18,426 $ 38,365 $ 36,494 
 Variable 1,292 1,349 3,056 3,245 
 
 Total Operating lease cost $ 20,779 $ 19,775 $ 41,421 $ 39,739 
 
 Sublease income 4,917 4,923 9,806 9,846 
 
 Finance lease cost: 
 Amortization of ROU Asset $ 2,428 $ 1,986 $ 4,552 $ 3,894 
 Interest on lease liabilities 312 96 520 174 
 Total Finance lease cost $ 2,740 $ 2,082 $ 5,072 $ 4,068 

 37 

 Future minimum lease payments under operating and finance leases with non-cancelable lease terms, as of June 30, 2023, are as follows: 
 
 (in thousands) Operating Leases Finance Leases 
 2023 $ 36,932 $ 4,607 
 2024 46,498 8,385 
 2025 38,395 4,798 
 2026 35,241 4,020 
 2027 29,117 3,930 
 2028 and thereafter 81,452 490 
 Total lease payments $ 267,635 $ 26,230 
 Less imputed interest ( 43,549 ) ( 2,548 ) 
 Total lease liability $ 224,086 $ 23,682 

 16. Cash 
 
 The following table provides a reconciliation of cash and cash equivalents together with restricted or segregated cash 
 as reported within the Condensed Consolidated Statements of Financial Condition to the sum of the same such amounts shown in the Condensed Consolidated Statements of Cash Flows. 
 
 (in thousands) June 30, 2023 December 31, 2022 
 Cash and cash equivalents $ 698,674 $ 981,580 
 Cash restricted or segregated under regulations and other 47,133 56,662 
 Total cash, cash equivalents and restricted cash shown in the statement of cash flows $ 745,807 $ 1,038,242 

 17. Capital Structure 
 
 The Company has four classes of authorized common stock. The Class A Common Stock and the Class C Common Stock have one vote per share. The Class B Common Stock and the Class D Common Stock have 10 votes per share. Shares of the Company’s common stock generally vote together as a single class on all matters submitted to a vote of the Company’s stockholders. The Founder Member controls approximately 85.8 % of the combined voting power of our common stock as a result of its ownership of our Class A, Class C and Class D Common Stock. The Company holds approximately a 58.9 % interest in Virtu Financial at June 30, 2023. 
 
 During the period prior to the Company's IPO and certain reorganization transactions consummated in connection with the IPO, Class A-2 profits interests and Class B interests in Virtu Financial were issued to Employee Holdco (as defined below) on behalf of certain key employees and stakeholders. In connection with these reorganization transactions, all Class A-2 profits interests and Class B interests were reclassified into Virtu Financial Units. As of June 30, 2023 and December 31, 2022, there were 4,289,305 and 4,462,840 Virtu Financial Units outstanding held by Employee Holdco (as defined below), respectively, and 173,535 and 328,999 of such Virtu Financial Units and corresponding Class C Common Stock were exchanged into Class A Common Stock, forfeited or repurchased during the six months ended June 30, 2023, and 2022, respectively. 
 
 Amended and Restated 2015 Management Incentive Plan 
 
 The Company’s Board of Directors and stockholders adopted the 2015 Management Incentive Plan, which became effective upon consummation of the IPO, and was subsequently amended and restated following receipt of approval from the Company’s stockholders on June 30, 2017, June 5, 2020 and June 2, 2022. The Amended and Restated 2015 Management Incentive Plan provides for the grant of stock options, restricted stock units, and other awards based on an aggregate of 26,000,000 shares of Class A Common Stock, subject to additional sublimits, including limits on the total option grant to any one participant in a single year and the total performance award to any one participant in a single year. 
 
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 On November 13, 2020, the Company amended its form award agreement for the issuance of RSUs to provide for the continued vesting of outstanding RSU awards upon the occurrence of a qualified retirement (the "RSU Amendment"). A qualified retirement generally means a voluntary resignation by the participant (i) after five years of service, (ii) the participant attaining the age of 50 and (iii) the sum of the participant's age and service at the time of termination equaling or exceeding 65. Continued vesting is subject to the participant entering into a 2 year non-compete. The RSU Amendment was authorized and approved by the Compensation Committee of the Company's Board of Directors. As a result of the RSU Amendment, currently issued and outstanding RSUs held by the Company's employees, including its executive officers, shall be deemed to be subject to the amended terms of the form award agreement, and any future RSU awards shall also be governed by such amended terms. 
 
 Amended and Restated Investment Technology Group, Inc. 2007 Omnibus Equity Compensation Plan 
 
 On the ITG Closing Date, the Company assumed the Amended and Restated ITG 2007 Equity Plan and the Assumed Awards. As of the ITG Closing Date, the aggregate number of shares of Class A Common Stock subject to such Assumed Awards was 2,497,028 and the aggregate number of shares of Class A Common Stock that remained issuable pursuant to the Amended and Restated ITG 2007 Equity Plan was 1,230,406 . 
 
 Share Repurchase Program 
 
 On November 6, 2020, the Company's Board of Directors authorized a share repurchase program of up to $ 100.0 million in Class A common stock and Virtu Financial Units by December 31, 2021. On February 11, 2021, the Company's Board of Directors authorized the expansion of the program by an additional $ 70 million in Class A Common Stock and Virtu Financial Units. On May 4, 2021, the Company's Board of Directors authorized the expansion of the Company's share repurchase program, increasing the total authorized amount by an additional $ 300 million in Class A Common Stock and Virtu Financial Units and extending the duration of the program through May 4, 2022. On November 3, 2021 the Company's Board of Directors authorized another expansion of the program by an additional $ 750 million to $ 1,220 million and extending the duration of the program through November 3, 2023. The share repurchase program authorizes the Company to repurchase shares from time to time in open market transactions, privately negotiated transactions or by other means. Repurchases are also permitted to be made under Rule 10b5-1 plans. The timing and amount of repurchase transactions are determined by the Company's management based on its evaluation of market conditions, share price, cash sources, legal requirements and other factors. From the inception of the program through June 30, 2023, the Company repurchased approximately 38.5 million shares of Class A Common Stock and Virtu Financial Units for approximately $ 1,016.7 million. As of June 30, 2023, the Company has approximately $ 203.3 million remaining capacity for future purchases of shares of Class A Common Stock and Virtu Financial Units under the program. 
 
 Employee Exchanges 
 
 During the six months ended June 30, 2023, and 2022, pursuant to the exchange agreement by and among the Company, Virtu Financial and holders of Virtu Financial Units, certain current and former employees elected to exchange 152,037 , and 92,930 units, respectively in Virtu Financial held directly or on their behalf by Virtu Employee Holdco LLC (“Employee Holdco”) on a one -for-one basis for shares of Class A Common Stock. 
 
 Warrant Issuance 
 
 On March 20, 2020, in connection with and in consideration of the Founder Member’s commitments under the Founder Member Loan Facility (as described in Note 8 "Borrowings"), the Company delivered to the Founder Member a warrant (the “Warrant”) to purchase shares of the Company’s Class A Common Stock. Pursuant to the Warrant, the Founder Member was entitled to purchase up to 3,000,000 shares of Class A Common Stock on or after May 22, 2020 up to and including January 15, 2022. The Founder Member Loan Facility Term expired on September 20, 2020 without the Company having borrowed any Founder Member Loans thereunder (as described in Note 8 "Borrowings"). The exercise price per share of the Class A Common Stock issuable pursuant to the Warrant was $ 22.98 , which in accordance with the terms of the Warrant, is equal to the average of the volume weighted average prices of the Class A Common Stock for the ten ( 10 ) trading days following May 7, 2020, the date on which the Company publicly announced its earnings results for the first quarter of 2020. On December 17, 2021, the Founder Member exercised in full the Warrant to purchase 3,000,000 shares of the Company's Class A Common Stock. The Warrant and Class A Common Stock issued pursuant to the Warrant were offered, issued and sold, in reliance on the exemption from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act"), set forth under Section 4(a)(2) of the Securities Act relating to sales by an issuer not involving any public offering. 
 
 Upon issuance, the fair value of the Warrant was determined using a Black-Scholes-Merton model, and was recorded as a debt issuance cost within Other assets on the Condensed Consolidated Statements of Financial Condition and as an increase 
 39 

 to Additional paid-in capital on the Condensed Consolidated Statements of Changes in Equity. The balance was amortized on a straight-line basis from March 20, 2020 through September 20, 2020, the date on which the Founder Member Loan Facility expired, and recorded as expense within Debt issue cost related to debt refinancing, prepayment and commitment fees in the Condensed Consolidated Statements of Comprehensive Income. 
 
 Accumulated Other Comprehensive Income 
 
 The following table presents the changes in Other Comprehensive Income for the three and six months ended June 30, 2023, and 2022: 
 
 Three Months Ended June 30, 2023 
 (in thousands) AOCI Beginning Balance Amounts recorded
in AOCI Amounts reclassified from AOCI to income AOCI Ending Balance 
 Net change in unrealized cash flow hedges gains (losses) (1) $ 37,091 $ 12,414 $ ( 7,535 ) $ 41,970 
 Foreign exchange translation adjustment ( 12,341 ) 1,503 — ( 10,838 ) 
 Total $ 24,750 $ 13,917 $ ( 7,535 ) $ 31,132 
 (1) Amounts reclassified from AOCI to income are included within Financing interest expense on long-term borrowings on the Condensed Consolidated Statements of Comprehensive Income. As of June 30, 2023, the Company expects approximately $ 30.1 million to be reclassified from AOCI into earnings over the next 12 months. The timing of the reclassification is based on the interest payment schedule of the long-term borrowings. 
 
 Three Months Ended June 30, 2022 
 (in thousands) AOCI Beginning Balance Amounts recorded
in AOCI Amounts reclassified from AOCI to income AOCI Ending Balance 
 Net change in unrealized cash flow hedges gains (losses) (1) $ 18,906 $ 6,391 $ 2,189 $ 27,486 
 Foreign exchange translation adjustment ( 2,887 ) ( 10,773 ) — ( 13,660 ) 
 Total $ 16,019 $ ( 4,382 ) $ 2,189 $ 13,826 
 (1) Amounts reclassified from AOCI to income are included within Financing interest expense on long-term borrowings on the Consolidated Statements of Comprehensive Income. 

 Six Months Ended June 30, 2023 
 (in thousands) AOCI Beginning Balance Amounts recorded
in AOCI Amounts reclassified from AOCI to income AOCI Ending Balance 
 Net change in unrealized cash flow hedges gains (losses) (1) $ 44,925 $ 11,025 $ ( 13,980 ) $ 41,970 
 Foreign exchange translation adjustment ( 13,321 ) 2,483 — ( 10,838 ) 
 Total $ 31,604 $ 13,508 $ ( 13,980 ) $ 31,132 
 (1) Amounts reclassified from AOCI to income are included within Financing interest expense on long-term borrowings on the Consolidated Statements of Comprehensive Income. As of June 30, 2023, the Company expects approximately $ 30.1 million to be reclassified from AOCI into earnings over the next 12 months. The timing of the reclassification is based on the interest payment schedule of the long-term borrowings. 
 
 Six Months Ended June 30, 2022 
 (in thousands) AOCI Beginning Balance Amounts recorded
in AOCI Amounts reclassified from AOCI to income AOCI Ending Balance 
 Net change in unrealized cash flow hedges gains (losses) (1) $ ( 10,481 ) $ 32,797 $ 5,170 $ 27,486 
 Foreign exchange translation adjustment 285 ( 13,945 ) — ( 13,660 ) 
 Total $ ( 10,196 ) $ 18,852 $ 5,170 $ 13,826 
 (1) Amounts reclassified from AOCI to income are included within Financing interest expense on long-term borrowings on the Consolidated Statements of Comprehensive Income. 
 
 18. Share-based Compensation 
 
 Pursuant to the Amended and Restated 2015 Management Incentive Plan as described in Note 17 "Capital Structure", and in connection with the IPO, non-qualified stock options to purchase shares of Class A Common Stock were granted, each of which vests in equal annual installments over a period of four years from grant date and expires not later than 10 years from the date of grant. 
 
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 The following table summarizes activity related to stock options for the six months ended June 30, 2023 and 2022: 
 
 Options Outstanding Options Exercisable 
 Number of Options Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Life Number of Options Weighted Average Exercise Price
Per Share 
 
 At December 31, 2021 1,795,655 $ 19.00 3.24 1,795,655 $ 19.00 
 Granted — — — — — 
 Exercised ( 268,879 ) 19.00 — ( 268,879 ) 19.00 
 Forfeited or expired ( 5,000 ) — — ( 5,000 ) — 
 At June 30, 2022 1,521,776 $ 19.00 2.74 1,521,776 $ 19.00 
 
 At December 31, 2022 1,521,776 $ 19.00 2.24 1,521,776 $ 19.00 
 Granted — — — — — 
 Exercised — — — — — 
 Forfeited or expired ( 10,000 ) — — — — 
 At June 30, 2023 1,511,776 $ 19.00 1.74 1,521,776 $ 19.00 

 The expected life was determined based on an average of vesting and contractual period. The risk-free interest rate was determined based on the yields available on U.S. Treasury zero-coupon issues. The expected stock price volatility was determined based on historical volatilities of comparable companies. The expected dividend yield was determined based on estimated future dividend payments divided by the IPO stock price. 
 
 Amended and Restated Investment Technology Group, Inc. 2007 Omnibus Equity Compensation Plan 
 
 On the ITG Closing Date, the Company assumed the Amended and Restated ITG 2007 Equity Plan and certain stock option awards, restricted stock unit awards, deferred stock unit awards and performance stock unit awards granted thereunder (" the Assumed Awards"). The Assumed Awards are subject to the same terms and conditions that were applicable to them under the Amended and Restated ITG 2007 Equity Plan, except that (i) the Assumed Awards relate to shares of the Company’s Class A Common Stock, (ii) the number of shares of Class A Common Stock subject to the Assumed Awards was the result of an adjustment based upon an Exchange Ratio (as defined in the ITG Merger Agreement) and (iii) the performance share unit awards were converted into service-based vesting restricted stock unit awards that were no longer subject to any performance based vesting conditions. 
 
 Class A Common Stock, Restricted Stock Units and Restricted Stock Awards 
 
 Pursuant to the Amended and Restated 2015 Management Incentive Plan as described in Note 17 "Capital Structure", subsequent to the IPO, shares of immediately vested Class A Common Stock, restricted stock units ("RSUs") and restricted stock awards ("RSAs") were granted, with RSUs and RSAs vesting over a period of up to 4 years. The fair value of the Class A Common Stock and RSUs was determined based on a volume weighted average price and the expense is recognized on a straight-line basis over the vesting period. The fair value of the RSAs was determined based on the closing price as of the date of grant and the expense is recognized from the date that achievement of the performance target becomes probable through the remainder of the vesting period. Performance targets are based on the Company's adjusted EBITDA for certain future periods. For the six months ended June 30, 2023 and 2022, respectively, there were 868,315 , and 580,710 shares of immediately vested Class A Common Stock granted as part of year-end compensation. In addition, the Company accrued compensation expense of $ 6.1 million and $ 9.6 million for the three months ended June 30, 2023 and 2022, respectively, and $ 12.0 million, and $ 15.5 million for the six months ended June 30, 2023 and 2022, respectively, related to immediately vested Class A Common Stock expected to be awarded as part of year-end incentive compensation, which was included in Employee compensation and payroll taxes on the Condensed Consolidated Statements of Comprehensive Income and Accounts payable, accrued expenses and other liabilities on the Condensed Consolidated Statements of Financial Condition. 
 
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 The following table summarizes activity related to RSUs (including the Assumed Awards) and RSAs for the six months ended June 30, 2023, and 2022: 
 
 Number of RSUs and RSAs Weighted
Average Fair Value 
 
 At December 31, 2021 3,224,447 $ 24.30 
 Granted 2,951,863 30.03 
 Forfeited ( 322,220 ) 25.47 
 Vested ( 1,669,030 ) 25.07 
 At June 30, 2022 4,185,060 $ 27.94 
 
 At December 31, 2022 3,954,833 $ 28.13 
 Granted (1) 3,473,137 19.40 
 Forfeited ( 139,609 ) 27.48 
 Vested ( 2,413,550 ) 23.59 
 At June 30, 2023 4,874,811 $ 24.18 
 (1) Excluded in the number of RSUs and RSAs are 37,500 participating RSAs where the grant date has not been achieved because the performance conditions have not been met. 
 
 The Company recognized $ 10.1 million and $ 9.5 million for the three months ended June 30, 2023 and 2022, respectively, and $ 20.2 million, and $ 18.1 million for the six months ended June 30, 2023 and 2022, respectively, of compensation expense in relation to RSUs. As of June 30, 2023 and December 31, 2022, total unrecognized share-based compensation expense related to unvested RSUs was $ 74.7 million and $ 54.6 million, respectively, and this amount is to be recognized over a weighted average period of 1.3 and 0.9 years, respectively. Awards in which the specific performance conditions have not been met are not included in unrecognized share-based compensation expense. 
 
 On November 13, 2020, the Company adopted the Virtu Financial, Inc. Deferred Compensation Plan (the "DCP"). The DCP permits eligible executive officers and other employees to defer cash or equity-based compensation beginning in the calendar year ending December 31, 2021, subject to certain limitations and restrictions. Deferrals of cash compensation may also be directed to notional investments in certain of the employee investment opportunities. 
 
 19. Regulatory Requirement 
 
 U.S. Subsidiary 
 
 The Company's U.S. broker-dealer subsidiaries VAL and RFQ-Hub Americas LLC ("RAL"), are subject to the SEC Uniform Net Capital Rule 15c3-1, which requires the maintenance of minimum net capital as detailed in the table below. RAL became a U.S. broker-dealer in June 2023. Pursuant to New York Stock Exchange ("NYSE") rules, VAL was also required to maintain $ 1.0 million of capital in connection with the operation of its designated market maker (“DMM”) business as of June 30, 2023. The required amount is determined under the exchange rules as the greater of (i) $ 1 million or (ii) $ 75,000 for every 0.1 % of NYSE transaction dollar volume in each of the securities for which the Company is registered as the DMM. 
 
 The regulatory capital and regulatory capital requirements of the Company's U.S. subsidiaries as of June 30, 2023 was as follows: 
 
 (in thousands) Regulatory Capital Regulatory Capital Requirement Excess Regulatory Capital 
 Virtu Americas LLC $ 455,763 $ 1,577 $ 454,186 
 RFQ-Hub Americas LLC 2,111 5 2,106 
 
 As of June 30, 2023, VAL had $ 40.9 million of cash in special reserve bank accounts for the benefit of customers pursuant to SEC Rule 15c3-3, Computation for Determination of Reserve Requirements, and $ 5.9 million of cash in reserve bank accounts for the benefit of proprietary accounts of brokers. The balances are included within Cash restricted or segregated under regulations and other on the Condensed Consolidated Statements of Financial Condition. 
 
 The regulatory capital and regulatory capital requirements of the Company's U.S. subsidiaries as of December 31, 2022 was as follows: 
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 (in thousands) Regulatory Capital Regulatory Capital Requirement Excess Regulatory Capital 
 Virtu Americas LLC $ 554,550 $ 1,000 $ 553,550 

 As of December 31, 2022, VAL had $ 50.2 million of cash in special reserve bank accounts for the benefit of customers pursuant to SEC Rule 15c3-3, Computation for Determination of Reserve Requirements, and $ 5.8 million of cash in reserve bank accounts for the benefit of proprietary accounts of brokers. 
 
 Foreign Subsidiaries 
 
 The Company’s foreign subsidiaries are subject to regulatory capital requirements set by local regulatory bodies, including the Canadian Investment Regulatory Organization ("CIRO"), the Central Bank of Ireland ("CBI"), the Financial Conduct Authority ("FCA") in the United Kingdom, the Australian Securities and Investments Commission ("ASIC"), the Securities and Futures Commission in Hong Kong ("SFC"), and the Monetary Authority of Singapore ("MAS"). 
 
 The regulatory net capital balances and regulatory capital requirements applicable to the Company's foreign subsidiaries as of June 30, 2023 were as follows: 
 
 (in thousands) Regulatory Capital Regulatory Capital Requirement Excess Regulatory Capital 
 Canada 
 Virtu Canada Corp (1) $ 11,516 $ 189 $ 11,327 
 
 Virtu Financial Canada ULC 2,682 189 2,493 
 Ireland 
 Virtu Europe Trading Limited (1) 119,962 27,176 92,786 
 Virtu Financial Ireland Limited (1) 90,589 51,497 39,092 
 United Kingdom 
 Virtu ITG UK Limited (1) 1,477 953 524 
 Asia Pacific 
 Virtu ITG Australia Limited 22,986 7,452 15,534 
 Virtu ITG Hong Kong Limited 2,340 556 1,784 
 Virtu ITG Singapore Pte Limited 690 87 603 
 Virtu Financial Singapore Pte. Ltd. 126,025 69,227 56,798 
 (1) Preliminary 

 As of June 30, 2023, Virtu Europe Trading Limited had $ 0.1 million of segregated funds on deposit for trade clearing and settlement activity, and Virtu ITG Hong Kong Ltd. had $ 30 thousand of segregated balances under a collateral account control agreement for the benefit of certain customers. 
 
 The regulatory net capital balances and regulatory capital requirements applicable to the Company's foreign subsidiaries as of December 31, 2022 were as follows: 
 
 (in thousands) Regulatory Capital Regulatory Capital Requirement Excess Regulatory Capital 
 Canada 
 Virtu ITG Canada Corp $ 14,248 $ 184 $ 14,064 
 Virtu Financial Canada ULC 2,663 184 2,479 
 Ireland 
 Virtu Europe Trading Limited 78,834 28,502 50,332 
 Virtu Financial Ireland Limited 89,853 39,768 50,085 
 United Kingdom 
 Virtu ITG UK Limited 1,405 906 499 
 Asia Pacific 
 Virtu ITG Australia Limited 30,027 3,115 26,912 
 Virtu ITG Hong Kong Limited 1,683 497 1,186 
 Virtu ITG Singapore Pte Limited 1,147 91 1,056 
 Virtu Financial Singapore Pte. Ltd. 121,166 46,025 75,141 

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 As of December 31, 2022, Virtu Europe Trading Limited and Virtu Canada Corp had $ 0.1 million and $ 0.4 million, respectively, of funds on deposit for trade clearing and settlement activity, and Virtu ITG Hong Kong Ltd had $ 30 thousand of segregated balances under a collateral account control agreement for the benefit of certain customers. 
 
 20. Geographic Information and Business Segments 
 
 The Company operates its business in the U.S. and internationally, primarily in Europe, Asia and Canada. Significant transactions and balances between geographic regions occur primarily as a result of certain of the Company’s subsidiaries incurring operating expenses such as employee compensation, communications and data processing and other overhead costs, for the purpose of providing execution, clearing and other support services to affiliates. Charges for transactions between regions are designed to approximate full costs. Intra-region income and expenses and related balances have been eliminated in the geographic information presented below to accurately reflect the external business conducted in each geographical region. The revenues are attributed to countries based on the locations of the subsidiaries. The following table presents total revenues by geographic area for the three and six months ended June 30, 2023, and 2022 : 
 
 Three Months Ended June 30, Six Months Ended June 30, 
 (in thousands) 2023 2022 2023 2022 
 Revenues: 
 United States $ 415,338 $ 485,744 $ 937,966 $ 1,035,193 
 Ireland 47,493 58,072 101,452 136,030 
 Singapore 28,079 31,043 54,297 77,320 
 Canada 7,782 21,514 16,498 38,711 
 Australia 7,215 7,347 13,855 16,268 
 
 Others 947 1,018 3,165 2,478 
 Total revenues $ 506,854 $ 604,738 $ 1,127,233 $ 1,306,000 

 The Company has two operating segments: (i) Market Making and (ii) Execution Services; and one non-operating segment: Corporate. 
 
 The Market Making segment principally consists of market making in the cash, futures, and options markets across global equities, fixed income, currencies, and commodities. As a market maker, the Company commits capital on a principal basis by offering to buy securities from, or sell securities to, broker-dealers, banks and institutions. The Company engages in principal trading in the Market Making segment direct to clients as well as in a supplemental capacity on exchanges, Electronic Communications Networks ("ECNs") and alternative trading systems ("ATSs"). The Company is an active participant on all major global equity and futures exchanges and also trades on substantially all domestic electronic options exchanges. As a complement to electronic market making, the cash trading business handles specialized orders and also transacts on the OTC Link ATS operated by OTC Markets Group Inc. 
 
 The Execution Services segment comprises client-based trading and trading venues, offering execution services in global equities, options, futures and fixed income on behalf of institutions, banks and broker-dealers. The Company earns commissions and commission equivalents as an agent on behalf of clients as well as between principals to transactions; in addition, the Company will commit capital on behalf of clients as needed. Client-based, execution-only trading in the segment is done primarily through a variety of access points including: (i) algorithmic trading and order routing in global equities and options; (ii) institutional sales traders who offer portfolio trading and single stock sales trading which provides execution expertise for program, block and riskless principal trades in global equities and ETFs; and (iii) matching of client conditional orders in POSIT Alert and client orders in the Company's ATSs, including Virtu MatchIt, and POSIT. The Execution Services segment also includes revenues derived from providing (a) proprietary risk management and trading infrastructure technology to select third parties for a service fee, (b) workflow technology, the Company’s integrated, broker-neutral trading tools delivered across the globe including trade order and execution management and order management software applications and network connectivity and (c) trading analytics, including (1) tools enabling portfolio managers and traders to improve pre-trade, real-time and post-trade execution performance, (2) portfolio construction and optimization decisions and (3) securities valuation. The segment also includes the results of the Company's capital markets business, in which the Company acts as an agent for issuers in connection with at-the-market offerings and buyback programs. 
 
 The Corporate segment contains the Company's investments, principally in strategic trading-related opportunities and maintains corporate overhead expenses and all other income and expenses that are not attributable to the Company's other segments. 
 
 44 

 Management evaluates the performance of its segments on a pre-tax basis. Segment assets and liabilities are not used for evaluating segment performance or in deciding how to allocate resources to segments. The Company’s total revenues and income before income taxes and noncontrolling interest (“Pre-tax earnings”) by segment for the three months ended June 30, 2023, and 2022 are summarized in the following table: 
 
 (in thousands) Market
Making Execution
Services Corporate Consolidated
Total 
 2023: 
 Total revenue $ 405,250 $ 109,116 $ ( 7,512 ) $ 506,854 
 Income before income taxes and noncontrolling interest 43,741 ( 115 ) ( 8,159 ) 35,467 
 
 2022: 
 Total revenue 432,595 130,997 41,146 604,738 
 Income (loss) before income taxes and noncontrolling interest 125,446 7,887 40,451 173,784 
 
 The Company's Pre-tax earnings by segment for the six months ended June 30, 2023, and 2022 are summarized in the following table: 
 
 (in thousands) Market Making Execution Services Corporate Consolidated Total 
 2023 
 Total revenue $ 904,169 $ 227,593 $ ( 4,529 ) $ 1,127,233 
 Income before income taxes and noncontrolling interest 167,850 8,898 ( 6,517 ) 170,231 
 
 2022 
 Total revenue 979,158 282,742 44,100 1,306,000 
 Income before income taxes and noncontrolling interest 349,668 23,013 42,813 415,494 
 
 21. Related Party Transactions 
 
 The Company incurs expenses and maintains balances with its affiliates in the ordinary course of business. As of June 30, 2023, and December 31, 2022 the Company had net payables to its affiliates of $ 1.8 million and receivables from its affiliates of $ 0.5 million, respectively. 
 
 The Company has held a minority interest in JNX since 2016 (see Note 9 "Financial Assets and Liabilities"). The Company pays exchange fees to JNX for the trading activities conducted on its proprietary trading system. The Company paid $ 3.4 million and $ 3.7 million for the three months ended June 30, 2023 and 2022, respectively, and $ 5.9 million and $ 7.5 million for the six months ended June 30, 2023 and 2022, respectively, to JNX for these trading activities. 
 
 The Company pays monthly use fees to two JVs in which it holds interests (see Note 11 "Variable Interest Entities"). These monthly fees are for the use of microwave communication networks operated by each of these JVs and are recorded within Communications and data processing on the Condensed Consolidated Statements of Comprehensive Income. The Company made payments to these JVs of $ 6.3 million and $ 5.5 million for the three months ended June 30, 2023 and 2022, respectively, and $ 12.6 million and $ 10.9 million for the six months ended June 30, 2023 and 2022, respectively. 
 
 The Company has an interest in Members Exchange, a member-owned equities exchange. The Company pays regulatory and transaction fees and receives rebates from trading activities. The Company made payments of $ 0.1 million and received rebates of $ 6.2 million for the three months ended June 30, 2023 and 2022, respectively, and the Company made payments of $ 0.2 million and received rebates of $ 12.8 million for the six months ended June 30, 2023 and 2022, respectively. 
 
 In the second quarter of 2022, the Company formed a JV to support the growth and expansion of a multi-asset request-for-quote communication platform. The Company consolidates this JV, and recorded noncontrolling interest of $ 39.2 million in the condensed consolidated statement of changes in equity as of June 30, 2022. Refer to Note 11 "Variable Interest Entities" for further details. 
 
 22. Subsequent Events 
 
 The Company has evaluated subsequent events for adjustment to or disclosure in its Condensed Consolidated Financial Statements through the date of this report, and has not identified any recordable or disclosable events, not otherwise reported in these Condensed Consolidated Financial Statements or the notes thereto, except for the following: 
 45 

 On July 26, 2023, the Company’s Board of Directors declared a dividend of $ 0.24 per share of Class A Common Stock and Class B Common Stock and per participating Restricted Stock Unit and Restricted Stock Award that will be paid on September 15, 2023 to holders of record as of September 1, 2023. 
 
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Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.
Virtu Financial, Inc. 10-Q

Item 1. Financial Statements
