SEC Proposes Changes to Simplify Market Structure
- The SEC has proposed rescinding Regulation NMS Rules 611 and 610(e), which have been in place since the mid-2000s.
- Rule 611, known as the trade-through rule, prevents trades from executing at worse prices when better quotes are available elsewhere.
- The proposal aims to reduce market complexity by eliminating mandatory routing obligations and focusing on execution quality.
- Tokenized equity platforms and blockchain-based alternative trading systems may indirectly benefit from a simplified execution framework.
- The proposal is open for public comment and is not yet final policy.
The SEC’s proposal to rescind Rules 611 and 610(e) could simplify US equity markets by removing complex routing requirements, potentially benefiting blockchain-based trading systems looking to enter the market. The focus is on enhancing competition and execution quality rather than adhering to rigid frameworks.
While the proposal does not directly address tokenized equities, it signals a willingness to revisit outdated rules that could hinder new market entrants. (Source)
