Intercontinental Exchange Plans First ‘Speed Bump’ in U.S. Futures Markets

According to a story in The Wall Street Journal, ICE’s futures exchange can now introduce a three-millisecond pause to help slower-moving firms, if the CFTC lets the plan proceed. Intercontinental Exchange Inc. can launch the first “speed bump” in U.S. futures markets after the Commodity Futures Trading Commission didn’t block the proposal. But two of the CFTC’s five commissioners disagreed with the decision, saying ICE’s speed bump would unfairly punish firms that focused on speedy trading strategies. Traders had been closely watching the CFTC’s decision because of the potential precedent it could set. Under CFTC rules, the agency had the ability to block the proposal within a 90-day period that ended last week. It took no action, meaning ICE is free to introduce its speed bump. Some of the world’s largest high-frequency trading firms had opposed the plan.