Where do electronic markets come from? Regulation and the transformation of financial exchanges

Michael Castelle, Yuval Millo, Daniel Beunza, David C. Lubin
2016 Economy and Society  
The practices of high-frequency trading (HFT) are dependent on automated financial markets, especially those produced by securities exchanges electronically interconnected with competing exchanges. How did this infrastructural and organizational state of affairs come to be? Employing the conceptual distinction between fixed-role and switch-role markets, we analyse the discourse surrounding the design and eventual approval of the Securities and Exchange Commission's Regulation of Exchanges and
more » ... of Exchanges and Alternative Trading Systems (Reg ATS). We find that the disruption of the exchange industry at the hands of automated markets was produced through an interweaving of both technological and political change. This processual redefinition of the 'exchange', in addition, may provide a suggestive precedent for understanding contemporary regulatory crises generated by other digital marketplace platforms.
doi:10.1080/03085147.2016.1213985 fatcat:vjick2v6y5cklo4lwcgx2au2ay