SEC Approval of First 24-Hour Stock Exchange
The Securities and Exchange Commission has given the green light to the first-ever 24-hour stock exchange in the US, marking a significant change in the world of trading. This new exchange, 24 Exchange (24X), is financially backed by Steve Cohen’s Point72 Ventures and will roll out in two phases.
Initially, 24X will operate during regular market hours. But the real game-changer is its plan to extend trading hours to overnight sessions, running from Sunday through Thursday, from 8 PM to 4 AM. This move comes in response to the increasing demand from retail investors who are used to the non-stop nature of cryptocurrency markets.
Dmitri Galinov, the CEO and founder of 24X, highlighted the risk traders face when the market is closed in their time zone. This new exchange aims to bridge that gap by providing a regulated and transparent market where trades are part of the official record, unlike the existing “dark pool” after-hours trading.
While this development is exciting, there are concerns from institutional investors about potential market volatility during overnight sessions when trading volumes are low. Tyler Gellasch, CEO of Healthy Markets Association, warned that small trades during these hours could lead to significant price movements impacting larger positions.
The New York Stock Exchange is also looking to extend its trading day to 22 hours, showing a broader industry trend towards longer trading hours. Before 24X can launch its overnight sessions, it needs to collaborate with other exchanges to manage the consolidated price tape system.
This approval is a big step forward for US equity markets, which have historically been constrained by settlement complexities and stringent investor protection regulations. It brings them more in line with other markets like Treasuries and major currencies, which have been operating almost continuously for a long time.
Overall, the introduction of a 24-hour stock exchange in the US marks a significant shift in the world of trading, offering new opportunities and challenges for both retail and institutional investors alike.
