Leading names in the US financial market have suggested that Wall Street could buck a decades-long trend and offer 24/7 trading, following in the footsteps of the largely unregulated cryptocurrency market, as well as gold and foreign exchange markets.
The heads of the SEC and CFTC have mooted the idea of extended trading hours due to the global demand for US. Although the move points to a global market, it would pose several challenges and raise a number of questions, but it certainly isn’t without precedent.
Cryptocurrency’s Advance
Cryptocurrency has changed a lot of aspects of life and business. It provides banking services for unbanked citizens around the world. It can be used to send overseas transactions for very little money, and it offers greater privacy.
These benefits have seen it become popular for remittances, ecommerce, and gaming. Bitcoin casino websites have also proven popular, offering large selections of games combined with instant withdrawals and secure, anonymous gaming.
Cryptocurrency For Trading
However, despite its increased use cases, cryptocurrency remains most popular as a form of investment. During Bitcoin’s early bull runs, speculators made considerable sums of money for relatively little investment. It has become more difficult to enjoy similarly sized returns for equally meager Bitcoin investments, due to its price above $100,000.
However, Bitcoin is one of thousands, potentially even tens of thousands, of cryptocurrencies. And, while holding Bitcoin and hoping for 1,000x returns is not as viable a trading strategy as it once was, there are still profits to be had here, too.
Borderless Bitcoin
One of the main selling points of Bitcoin, when it first launched and still today, is that it offers borderless transactions. Unlike shares, which are floated on stock exchanges in specific countries, and some other investments, the global trading of cryptocurrencies, as well as the unregulated and decentralized nature of most early trading platforms, meant cryptocurrencies could be traded 24 hours a day.
Wall Street And The NYSE
Wall Street, on the other hand, is home to the New York Stock Exchange. Foreign companies can float on the NYSE, but they must meet strict criteria to do so. It’s estimated that only around one in five companies listed on the exchange are considered overseas interests. The NYSE, like most stock exchanges, is primarily a national trading vehicle.
How Things Change
However, times have changed. Borders have become less important when it comes to trading stocks and shares.
Apps like Robin Hood, which itself started in the US market but has since expanded into the UK and EU, have made it easier to buy US shares from abroad.
They also make it easier for potential investors to research and trade shares any time of the day, and major financial groups in the US have taken notice of this.
SEC And CFTC Working Together
Chairman of the Securities and Exchange Commission (SEC), Paul Atkins, and Acting Chairman of the Commodity Futures Trading Commission (CFTC) issued a joint statement saying: “For on-chain finance to scale, the SEC and the CFTC should collaborate to consider the possibility of further expanding trading hours, where appropriate,” before going on to say: “Certain markets, including foreign exchange, gold, and crypto assets, already trade continuously.”
However, the pair did temper expectations somewhat by saying that 24-hour trading is more viable for some asset classes than others. The statement was primarily concerned with opening up trading hours for other markets.
However, the statement, which also called for greater regulatory collaboration between the two parties, went on to say that by “collaborating on innovative products and trading platforms, the two agencies could unlock new opportunities for market participants, foster innovation, and solidify the United States as the global leader in crypto and blockchain technology.”
Extending Extended Hours Trading
Extended hours trading already exists. Pre-market trading occurs between 8 a.m. and 9.20 a.m., while after-hours trading can run until as late as 8 p.m. However, the use of extended hours trading is still considered highly volatile, and the majority of trading is still currently conducted during normal, scheduled trading hours.