Capital markets exchanges made progress in September on rolling out around-the-clock trading and market participants took steps in broadening the acceptance of digital assets. The month also saw advancements in technological innovation, with capital markets organizations offering both mobile and upgraded cloud solutions. These developments underscore the shift in how exchanges, clearinghouses, broker-dealers and investors engage with the market.
Here’s a look at key trends from last month:
Around-the-clock trading
24 Exchange announced a date change for the launch of its 24X National Exchange, adjusting the initial go-live date from September to Oct. 14. The extra time allows the exchange to onboard additional broker-dealers, facilitating further liquidity and a robust market, which are critical components for exchanges offering extended, around-the-clock trading for both retail and institutional investors.
Upon launch, the market will be available between 4 a.m. and 8 p.m. Eastern Time on weekdays. Upon phase two of the launch, 24 Exchange plans on extending trading hours further, from 8 p.m. Eastern on Sundays to 8 p.m. Eastern on Fridays. This structure mirrors cryptocurrency and foreign exchange markets. The coming debut of this extended-hours exchange is the latest news in the shift toward around-the-clock trading in the U.S. capital markets and could set the stage for other exchanges to follow suit.
Digital asset acceptance and regulatory clarity
Bitnomial, a Chicago-based derivatives exchange, announced in September that it would start to accept digital assets as margin collateral, starting with bitcoin and ether to back positions in leveraged perpetuals, futures and options. This advancement will mark Bitnomial as the first Commodity Futures Trading Commission-regulated exchange to accept digital assets as collateral. Retail investors have access to the same capabilities through Botanical, Bitnomial’s retail trading platform.
This change enhances capital efficiency, as investors can deploy their digital assets without having to convert them to U.S. dollars, avoiding unnecessary conversion costs. This also signals an appetite to shift to alternative risk management models and collateral frameworks.
Relatedly, on Sept. 29, the CFTC and the U.S. Securities Exchange Commission conducted a joint round table that focused on regulatory harmonization across digital and traditional asset classes. Historically, overlapping mandates have created friction and hindered innovation in the digital asset space. This landmark roundtable signaled a commitment toward collaboration and joint supervision for crypto trading platforms and market participants.
Leading crypto exchanges and established players from traditional finance circles were in attendance, bridging the gap between old and new market structures. Greater regulatory clarity and cohesion could unlock more innovation and pave the way for new digital products and greater adoption of those products.
Read more financial services industry insights at RSMUS.com.
Market infrastructure and software innovation
Nasdaq and Amazon Web Services announced an extension of their strategic technology partnership, giving financial institutions the opportunity to deploy Nasdaq Calypso on AWS. Nasdaq Calypso is a treasury and risk management platform that supports financial institutions from front office to back office, including risk management and regulatory compliance. Nasdaq will manage the underlying technology while AWS will provide the secure, resilient cloud infrastructure. Financial institutions will benefit from more seamless software support, improved scalability, and enhanced operational resilience, all while leveraging cutting edge and secure AWS cloud technology.
Also last month, MarketAxess announced the launch of its new mobile-friendly platform, Axess IQ Connect. The newly introduced platform is an extension of their traditional execution management system designed for private banks and wealth managers. The mobile platform services as a seamless integration point between client advisors and trading desks, and allows for real-time access to market insights, data, and streamlined fixed income trading from any device. Advisors can also leverage CP+ on the go, which is MarketAxess’s AI-driven pricing engine. This allows advisors to respond quickly to market movements, supporting their clients more effectively. This innovative technology solution signals a trend toward real-time, mobile-enabled technology solutions.
Combined, the news of these technological advancements show how capital markets organizations are prioritizing frictionless systems, which will ultimately better enable more efficient, real-time responses to market movements. Other organizations in the space should assess their current technology ecosystems to identify opportunities for improvement, such as ease and availability of end user access and streamlined transaction capabilities.
The takeaway
The capital markets ecosystem is continuing to rapidly evolve, driven by extended trading hours, innovative digital assets products and cutting-edge technologies. These shifts point to a future where markets are more accessible, interconnected, and technology driven, challenging the status quo of traditional markets and redefining how and where participants engage on a global scale.
