The shutdown of the Tokyo Stock Exchange (TSE) for a whole day last week took the financial world by surprise, not so much because it hit the world’s third biggest equity market by size ($6 trillion) but because of how long it lasted.
A team of journalists at Bloomberg (opens in new tab) identified the process that sparked the domino effect - one that ultimately caused the catastrophic crash.
A storage peripheral called the “No. 1 shared disk device” (one of two cubic devices that store data for the TSE) flagged a memory error and an automatic failover to “No. 2 shared disk device” did not occur. The likely source of the crash was therefore a defective hard disk drive (opens in new tab), solid state drive or memory module.
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The incident, as described by the financial news outlet, caused a knock-on effect on vital servers that send market information to trading desks. Administrators had to instigate the switchover to the backup disk device by hand instead and the fateful decision was taken by the Tokyo Stock Exchange to shut down for the entire day.
Hardware does (and will) fail regardless of the size of your business and, as we've seen, trading systems are not immune, due partly to their complexity and the need to operate in quasi real-time.
Add in the additional threat of ransomware (opens in new tab) and other cyberattacks and similar events are bound to happen in the future. It's a case of when, not if.
Businesses can mitigate the risk using cloud backup (opens in new tab) and cloud storage (opens in new tab) solutions, as well as adopting a 3-2-1 backup strategy (opens in new tab): three copies of the data, stored on two types of media (e.g. NAS drive (opens in new tab)), with one copy stored offsite.
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