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American Journal of Applied Science and Technology

Peer Reviewed | Open Access | E-ISSN: 2771-2745
Published Article

Enhanced Multicast Scaling in Low-Latency Trading Colocation Environments: A Critical Analysis of VXLAN/BGP EVPN Architectures

Enhanced Multicast Scaling in Low-Latency Trading Colocation Environments: A Critical Analysis of VXLAN/BGP EVPN Architectures

Authors

  • Elias J. Sterling
    Department of Advanced Networking and Telecommunications, Global School of Financial Engineering, London, United Kingdom
  • Sarah N. Reynolds
    Faculty of Data Center Architecture, Institute for Computational and Financial Sciences, Singapore, Singapore

Keywords:

VXLAN/BGP EVPN IP Multicast Scaling High-Frequency Trading (HFT) Colocation Networks Low Latency Network Virtualization Multicast Group Capacity (MGC)

Abstract

Context: High-Frequency Trading (HFT) relies critically on ultra-low latency dissemination of market data via IP Multicast within colocation facilities. The adoption of VXLAN/BGP EVPN has provided scalable Layer 2/3 virtualization for these multi-tenant environments. However, the sheer volume of market data feeds presents a significant and often overlooked challenge to the multicast scaling capabilities of standard EVPN architectures.

Objective: This paper provides a critical analysis of the scaling limitations of multicast forwarding mechanisms within VXLAN/BGP EVPN overlays, specifically examining their suitability for the stringent latency and group count demands of HFT colocation networks.

Methods: We analytically model and evaluate two primary EVPN multicast forwarding strategies: Ingress Replication (IR) and PIM-integrated Underlay Multicast. Key performance metrics, including Control-Plane Convergence Time, Data-Plane Latency Jitter, and Multicast Group Capacity (MGC), are defined and used for a comparative assessment based on typical HFT traffic profiles.

Results: Our analysis reveals that standard IR suffers from significant control-plane state proliferation (BGP EVPN Type-6 route explosion) and bandwidth inefficiency. Conversely, PIM-integrated solutions, while data-plane efficient, introduce complexity and potential for forwarding-state synchronization issues and hardware resource exhaustion (TCAM). Neither approach optimally meets the combined low-latency and high-MGC requirements.

Conclusion: The conventional implementations of VXLAN/BGP EVPN are insufficient to support the massive, low-latency multicast scaling required by modern HFT colocation. Architectural enhancements, including SDN-based control-plane optimization and innovative route aggregation techniques, are necessary to ensure the continued performance and resilience of these critical financial networks.

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