Top Headlines

FXPA Webinar: “The CFTC’s SEF Reform Rule: Its Key Aspects and Prognosis” Tuesday,December 11th at 9-10am (ET) – FXPA

Justin Slaughter, former counsel to a CFTC Commissioner and current counsel to the Foreign Exchange Professionals Association (FXPA), will provide a detailed breakdown of the CFTC’s new regulatory proposal to fully overhaul SEFs. Justin will provide a summary of the major changes contemplated, including changes to the made-available-to-trade process, SEF accessibility, and pre-execution communication requirements. Justin will alsodiscuss the timeline for the rule, the motivations underlying it within the CFTC, and its prospects for finalization in its current form.

Pound Traders Glued to Desks as Brexit Vote Meets Witching Hour – Bloomberg

Currency traders are taking no chances as the UK Parliament’s Brexit vote late Tuesday will come during thin liquidity heading into the market’s witching hour.

It’s Been a Tough Year for the FX Global Code (opinion) – Profit & Loss

In FX Global Code terms, a practice that it endorses (with the appropriate disclosures and intent, of course) was deemed worthy of a jail sentence by a US judge, while a case that surrounded behaviour that the Code explicitly warns against – the inappropriate sharing of information – ended in an acquittal. To lay my cards on the table, I don’t think either case should have gone as far as a courtroom, and looking back I don’t think the industry has any better understanding of what, or what will not, land you on the wrong side of a US criminal charge – and that is a challenge for the Code going forward.

Building Out Spot Vs. Non-Spot FX Liquidity – Profit & Loss

Which is harder for a trading venue: building out a spot FX business or non-spot FX business? This is the question that was posed to Carlo Koezler, CEO of 360T and global head of FX at Deutsche Börse Group, in a video interview with Profit & Loss.

The Challenges of Managing Risk in Machine Driven Markets – Profit & Loss

The increasing automation of the FX markets is changing how firms manage their risk.

In the FICC of It (podcast) – Profit & Loss

The podcasters discuss the potential implications of Cboe’s agreement with UBS to help broaden the reach of its FX platform – and why Refinitiv might want to sit up and pay attention. They also discuss the multi-dealer platform world looking at how platforms can differentiate themselves. Are these firms really taking the single dealer model and deploying it in a multi-dealer landscape? Will this work? What are the USPs of a single and multi-dealer platform?

Regulatory News

Goldman Subject of Whistleblower Complaint over Mifid II – Financial Times (subscription)

A whistleblower at Goldman Sachs has gone to the UK’s financial watchdog to allege that the Wall Street bank has improperly recorded trading data. The UK’s Financial Conduct Authority has been made aware of the allegations by the whistleblower and is now weighing whether to take the matter further.

Finance Groups Call for Legal Certainty on Post-Brexit Clearing – Financial News (subscription)

Isda, FIA, Afme and Icma are concerned that UK clearing houses will serve termination notices to EU members.

Don’t Let Brexit Mess with Your Client Relationships – Bloomberg

Amidst the current political uncertainty, financial institutions are already preparing to move thousands of contractual relationships impacted by the potential loss of passporting. Brexit represents a challenge to financial services firms looking to continue to offer their existing suite of products and services between the UK and continental Europe. 

New CFTC Pursues New Priorities But Old Challenges Linger – WilmerHale

On August 28, 2018, the US Senate confirmed Dan Berkowitz (D) and Dawn Stump (R) as Commissioners of the US Commodity Futures Trading Commission. With the addition of these two Commissioners—and Chairman J.Christopher Giancarlo (R), Commissioner Brian Quintenz (R), and CommissionerRostin Behnam (D)—the CFTC once again has a full five-person complement after four years of persistent empty seats. But what will the new Commission accomplish? 

Value of City Watchdog Fines Touches Near-Record Lows for 2018 – Financial Times (subscription)

Fines levied over 2018 stand at just £27.6m so far, compared with £229.5m last year.

Crypto News

Crypto Diehards Say Slump Is `Bump in the Road’ Before Growth – Bloomberg

The future of cryptocurrencies will entail greater regulation, more involvement by large institutions, lower volatility and greater integration with traditional assets.

As Bitcoin Trading Shifts Shape, Big Money Stays Away – Reuters

The retail investors behind bitcoin’s dizzying ascent to a record of nearly $20,000 last December have fled, leaving the early adopters and crypto-related firms that traditionally dominated digital coin trading driving exchange volumes.

Seed CX Partners with Deltix for Crypto Trading – Profit & Loss

Seed CX, an exchange for institutional trading and settlement of spot digital asset products, announces that investorscan now access its market via Deltix’s crypto-trading platform, CryptoCortex.

SIX Ponders Regulatory Route for Digital Exchange – Global Investor (subscription)

Valerio Roncone has also revealed the bourse spends CHF 1 million daily on innovation, excluding the crypto build-out.

Coinbase Continues to Explore Support for New Digital Assets – Coinbase

Coinbase is continuing to explore the addition of new assets, and will be working with local banks and regulators to add them in as many jurisdictions as possible.

Company News

CLS Activity Flat on Year, Down on the Month – Profit & Loss

CLS says it handled settlement instructions to the notional value of $1.68 trillion in November, up very slightly from the $1.677 trillion in November 2017 and down from $1.71 trillion in October. This represents a 1.7% drop on a month-on-month basis and is largely in line with data reported earlier by various FX platforms.

FIA and FIA Tech Release Guidelines for the Simplified Execution Source Code – FIA

FIA together with affiliate FIA Tech, have released new technical guidelines for firms to properly identify the correct brokerage when executing and clearing exchange traded derivatives.  

Euronext Global FICC Head Departs – The Trade

Paul Humphrey has decided to leave to pursue other opportunities after almost three years with Euronext. Chris Topple, currently CEO of Euronext London, will lead the FICC business in Humphrey’s absence.

CME Group Completes Eris Swap Futures Migration with 10 Trading Firms – The Trade

CME Group has completed the first trades of USD Eris interest rate swap futures following the migration of the derivatives to its exchange on 3 December, with ten firms actively trading.

Changes at the Top for Flow Traders – Profit & Loss

Flow Traders will propose to appoint Dennis Dijkstra as its sole CEO at the May 2019 AGM.

WM/Reuters Thai baht Benchmarks to be Sourced from Matching Clob – FX Week (subscription)

The WM/Reuters Thai baht spot FX benchmarks are to besourced from Refinitiv’s anonymous central limit order book Matching, following an analysis by the firm as to the viability of introducing transactional data from FX trading platforms.

Regis-TR’s UK Arm Nears Launch – Global Investor (subscription)

Trade repository has set up a local entity to ensure access to clients after Brexit.

Nasdaq/Cinnober Deadline Looms as CMA Consultation Closes – Global Investor (subscription)

The Competition and Markets Authority is reviewing concerns about Nasdaq’s bid for Cinnober.

Moexto Build Out Repo Benchmark Rate – Global Investor (subscription)

Moscow Exchange derivs head says the repo rate can become a new benchmark rate for Russian Ruble.

Rumble in the IM Jungle: How New Platforms Match Up – (subscription)

After testing rival margin services, banks now have to pick a favourite – one has better tech, the other is cheaper.

Germany Willing to Merge Deutsche Bank, Commerzbank, Focus Says – Bloomberg

The German finance ministry is willing to “orchestrate” a merger between Deutsche Bank and Commerzbank.

Market Savvy

Dollar Little Changed after Biggest Weekly Loss in Three Months – Reuters

The dollar consolidated losses on Monday after postingits biggest weekly drop in more than three months last week as weak US data undercut expectations of more interest rate increases in the world’s biggest economy.

JP Morgan Recommends ‘Hefty Arsenal of Hedges’ for In-Flux 2019 – Bloomberg

JP Morgan expects the Standard &Poor’s 500 to rise 18 percent by the end of 2019. That doesn’t mean the firm sees a smooth ride: It’s recommending additional hedges in anticipation of more volatility along the way.

China’s Currency on Track for Biggest Fall in Two Months – Financial Times (subscription)

China’s renminbi started the week off on a poor footing, on track for its worst day in two months, after official inflation and export data disappointed.