The CFTC, in its desire to catch up to the rapidly changing market structure, may have bitten off a little more than it could chew with Regulation Automated Trading. Responding to industry concerns, the regulator recently revised the proposal. But the changes dont go far enough and may expose the industry to added risk, says TABBs Tom Lehrkinder.
On Nov. 4, 2016, one year after its original proposal, the CFTC, led by chairman Timothy Massad, released a supplemental notice regarding Regulation Automated Trading (Reg AT). During the past year, there were countless roundtables, comment letters, conference calls, analyst reports, and industry panels focused exclusively on this proposed regulation. I attended many of them, participated in a few, and witnessed the passion and thoughtfulness of the futures industry, regulators, and especially the Futures Industry Association (FIA). They all are tireless workers who sincerely are trying to make the US futures markets the best and safest in the world.
My contention close to a year ago, and which still holds true today, is that the CFTC, in its desire to catch up to the rapidly changing market structure, bit off a little more than it could chew with Reg AT (Too Big to Pass: CFTC Reg AT
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