Curated News
By: NewsRamp Editorial Staff
March 26, 2024
SEC Adopts New Rules for U.S. Treasury Market Clearing
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GithubTLDR
- New SEC rules for U.S. Treasuries may increase trading costs, giving some traders a competitive advantage.
- The new rules require the majority of trades in the U.S. Treasuries markets to be cleared through a central counterparty clearinghouse.
- The new rules could potentially make the world a better place by increasing market resiliency and liquidity in the U.S. Treasury market.
- CME announced their plan to enter the U.S. Treasury space, raising questions about who will need to clear and access to clearinghouses.
Impact - Why it Matters
The SEC's adoption of new rules for U.S. Treasury market clearing will have significant implications for market participants, including potential impacts on trading costs, market resiliency, and liquidity. These changes could affect a wide range of stakeholders, from institutional investors to retail traders, and may require adjustments in trading strategies and risk management practices.
Summary
The U.S. Securities and Exchange Commission (SEC) has adopted new rules requiring the majority of trades in the $26 trillion U.S. Treasuries markets to be cleared through a central counterparty clearinghouse. These changes represent a significant overhaul to the structure of the world’s largest and most liquid market. The new rules are set to be phased-in beginning in March 2025, with Treasury cash clearing beginning December 31, 2025, and repo clearing beginning June 30, 2026. The mandate has raised concerns about increased trading costs, potential impacts on market resiliency and liquidity, and the challenges associated with clearinghouse access.
Source Statement
This curated news summary relied on this press release disributed by News Direct. Read the source press release here, SEC Adopts New Rules for U.S. Treasury Market Clearing
