Bart Chilton, CFTC Commissioner (Golden Networking)
As reported by Bloomberg’s Silla Brush, the U.S. Commodity Futures Trading Commission (CFTC) is seeking comment on whether to require registration for automated trading firms, taking a first step in potential restrictions on high-speed and algorithmic derivatives trading.
CFTC members voted unanimously to issue a concept release requesting input on more than 100 questions, including whether to expand testing and supervision of high-speed trading strategies. Today’s release, a step prior to a formal proposal by the top U.S. derivatives regulator, also considers ways to limit the maximum number of trading orders a firm can place in a given amount of time.
“Traditional risk controls and system safeguards, many of which were developed according to human speed and floor-based trading, must be evaluated in light of new market realities,” CFTC Chairman Gary Gensler said in a statement.
“In general, those involved in financial markets seem to have blindly accepted that technology is almost always a good thing,” Bart Chilton, a Democratic CFTC commissioner, said in a statement. “But it doesn’t work well enough if we continue to see aberrations.”
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