Prospects for 24-hour trading in 2022 are ‘bright’: 24 Exchange CEO
The CEO of an exchange is negotiating with Securities and Exchange Commission for 24-hour trading in the U.S.
CNBC’s Dmitri Galinov, CEO of 24 Exchange said “The prospects for it to be approved in 2022 are very bright.” “ETF Edge”This Thursday
Launched in 2020, and supported by hedge fund billionaire Steve CohenGalinov stated that 24 Exchange hopes to close its negotiations with the SEC before the end of December to receive a license for next year’s operation.
This company is a specialist in cryptocurrency, stock trading, and foreign exchange. It aims to enable its clients to trade various assets at minimal friction and low costs.
Galinov explained that cryptocurrency trading has created a large demand for a 24 hour stock exchange.
Equity side: “If you take a look at what is trading shortly after 4 o’clock in the afternoon, it’s very little.” “It’s just 4%,” said the CEO. But if we look at cryptocurrency, more than a third trades outside regular hours on weekends and other weekend days. However, it is the same traders.
Galinov explained that global traders are also seeking greater access to U.S. securities. Large banks and hedge funds told 24 Exchange they were excited by the pitch.
According to the SEC website, extended trading is a concern because of potential limited liquidity and large spreads. They also fear higher volatility, greater price uncertainty, professional competition from institutional trader professionals, as well as lower prices.
Galinov however paints a completely different picture. His back and forth dealings with regulators is described as productive and focused on the small details.
ETF Trends’ Dave Nadig stated in the same interview that there are some issues with this move. The idea is a good one. The firm’s chief investor officer and director, research, said that he was skeptical about immediate demand.
Nadig explained that even if crypto traders are not in demand, problems could occur with exchange-traded mutual funds. These funds trade stocks as well.
He stated that he was skeptical about trading ETFs based on after-hours news because it is impossible to imagine any liquidity so large that one could arbitrage entire portfolios on Thursday mornings.
Nadig recognized, however that it was probable for trading to continue around the clock.
If we look at the future, whether it is in two years, five or ten years, we will be heading towards an even more global 24/7 market. It’s only a matter of how to get there. However, I believe it’s valid to be skeptical,” said he. Volumes in the aftermarket market are low. If you pull up any stock which is trading on earnings, you can see an incredible spike in liquidity at say 4:05. Then, there’s the immediate drop-off in liquidity.