CFTC Swap-Trading Rules May Limit Market Entrants, Moody's Says
A U.S. proposal that swaps-execution facilities have tighter market oversight than the exchanges they'll compete with may limit competition among the systems meant to increase transparency, according to Moody's Investors Service. "It's a barrier to entry in the sense that they can't just comply by slapping together pieces of software and saying we're a SEF," said Alexander Yavorsky, a senior analyst at Moody's in New York.
The CFTC has proposed limiting the ability of swap-execution facilities to outsource their trade oversight duties and wants to require them to have a year's worth of funding on hand at all times, both standards that exchanges don't have to meet.
Publication
Bloomberg
Date
Feb. 2, 2011
Cross References
Dodd-Frank Act, Title VII, Sec. 733; CEA Sec. 5h