WASHINGTON – Federal regulators signaled Monday that they may more strictly oversee the high-speed trading that’s come to dominate financial markets and impose risk controls in response to a series of market-disrupting technology glitches.
The 137-page “concept release” from the Commodity Futures Trading Commission comes at a time when regulators are struggling to cope with a technological revolution that has transformed trading from a humancentric endeavor to one driven by computers that execute orders at blink-of-an-eye speeds — sometimes with disastrous results.
One of the most harrowing episodes was the May 2010 “flash crash,” when the stock market plunged nearly 1,000 points in minutes, then whipped back up.
Monday’s CFTC document, which took nearly two years to complete, was unanimously approved before it was released to the public for comment. The document solicits input on more than 100 questions, including whether the government should intervene and impose risk controls on the industry.