In 2024, BLOX Markets is preparing to launch a new retail-focused trading venue for U.S. equities, according to remarks from CEO and co-founder Khody Azmoon, reported by Traders Magazine. While the venue awaits regulatory approvals, Azmoon noted that the company’s primary theme revolves around the sustained growth of retail trading. Although retail trading has seen a decline from its peak levels in 2020, current trading volumes are still considerably higher than those before the COVID-19 pandemic, with expectations for further growth into 2025.
A significant highlight for the company in 2024 occurred in September when the Securities and Exchange Commission (SEC) approved the second of four proposals aimed at revising the equity market structure. These proposals focus on amendments concerning Tick Sizes, Access Fees, and Transparency of Better-Priced Orders. Azmoon noted that these amendments received unanimous commission support, with a 5-0 vote indicating strong bipartisan backing, thus enhancing their prospects for successful implementation.
However, 2024 brought unexpected developments as well. Legal challenges to these market structure changes were filed by NASDAQ and the Chicago Board Options Exchange (CBOE), which were joined by a third party, We The Investors. Notably, no other exchanges or market participants have aligned with these challenges, perhaps reflecting a perceived low chance of success given the SEC's favourable past rulings in similar instances. The SEC has opted for pragmatism by allowing a partial stay of the proposals until a decision is made by the D.C. Circuit Court.
Looking towards 2025, Azmoon anticipates a host of activities, which will include a change in leadership at the SEC. Experts are suggesting that changes to the equity market structure related to Reg NMS, specifically those addressing Tick Sizes and Access Fees, might see delays until 2026, though implementation remains on the horizon.
Emerging trends within the trading landscape are becoming increasingly evident. Azmoon highlighted that several quantitative trading firms are planning to expand their equities operations into electronic market-making. Simultaneously, established electronic market makers are considering entering the equities space or enhancing their existing operations to include a broader range of symbols. With the anticipated regulatory amendments concerning Tick Sizes, Access Fees, and Transparency of Better-Priced Orders, a shift is expected towards medium-term, alpha-driven strategies from short-duration, spread-based approaches among electronic market makers.
As BLOX Markets prepares for its anticipated launch, flexibility remains a key theme for the company as it navigates the regulatory landscape and prepares to enter this evolving market space in 2025.
Source: Noah Wire Services