Comment Text:
May 5, 2025:
To:
Christopher J. Kirkpatrick
Secretary
Commodity Futures Trading Commission
Three Lafayette Centre
1155 21st Street, NW
Washington, DC 20581
Re: Request for Comment on 24-Hour/7-Day Trading for CFTC-Regulated Contracts
Dear Mr. Kirkpatrick, and CTFC Staff:
I appreciate the opportunity to comment on the Commission’s exploration of continuous (“24/7”) trading for U.S.-listed futures, options on futures, and related derivatives. I submit these remarks strictly in my personal capacity; they do not represent the views of my employer—Reink Media Group, ForexBrokers.com, StockBrokers.com, or Investor.com—nor any affiliated entity.
1. Strategic Context—Global Markets Are Already Evolving Toward 24/7
Growing alignment across asset classes. Major spot-FX venues, certain equity index derivatives, and several overseas exchanges already overlap to provide near-round-the-clock liquidity. Extending U.S. futures trading to weekends would harmonize domestic markets with this reality and help maintain U.S. leadership in capital-market innovation.
Precedent in digital assets. Bitcoin and other decentralized networks have demonstrated for more than a decade that deep, algorithmically cleared markets can operate continuously with minimal downtime, despite the challenges that exist in those networks including front-running via gas price auctions on decentralized exchanges (DEXs) and automated market makers (AMMs). These risks are largely mitigated in centrally cleared markets provided the proper controls are in place.
2. Market-Quality Benefits
Liquidity in thin hours. Opening Saturday and Sunday sessions would reduce the “gap risk” currently concentrated into the Monday open, distributing liquidity across the full news cycle (e.g., geopolitical events, natural-disaster headlines).
Price discovery & transparency. Continuous markets improve the informational efficiency of prices; fewer discontinuities mean smaller step-function moves that can otherwise incentivize aggressive front-running or trigger disproportionate margin calls.
Retail access & flexibility. Millions of market participants work traditional weekday hours. Evening and weekend sessions give them agency to manage risk without relying exclusively on stop orders or overnight futures proxies that may not track their desired exposures.
Reduced manipulation windows. Illiquid, closed periods are fertile ground for rumor-driven price formation. Extending trading hours narrows those windows, provided surveillance tools evolve in parallel.
Role of Artificial Intelligence. The rapid maturation of generative and predictive AI is already transforming trade surveillance, market-making, and investor decision support. Continuous, machine-driven liquidity provision—spanning smart order-routing, adaptive quoting, and real-time anomaly detection—means that 24/7 markets need not rely on a proportional increase in human staffing. AI-enabled risk analytics can flag spoofing or price-dislocation patterns in milliseconds, while conversational agents give retail participants round-the-clock access to education and risk disclosures. In short, the same technologies powering today’s always-on digital-asset venues can enhance resiliency, transparency, and user protection as traditional futures and securities markets extend into weekend hours and round-the-clock trading.
3. Transitional Challenges & Risk Mitigants
Clearing-bank liquidity on weekends – start with cash-settled contracts and secured multi-timezone credit lines; longer term, broaden settlement-bank coverage through CLS-style payment-vs-payment and intraday netting.
Operational staffing & fatigue – launch Saturday daytime trading first, expand to full weekend only after capacity metrics improve; over time rely on automation, AIOps monitoring, and follow-the-sun staffing.
Wider spreads/arbitrage early in rollout – require risk disclosures and publish weekend depth-of-book data; as liquidity deepens, market-maker competition should tighten spreads.
Error handling/trade reversals – implement a brief “breakage” window for corrections under current error-trade rules; ultimately migrate to real-time gross settlement to minimize reversal needs.
4. Recommendations
Adopt an incremental launch schedule (this is just a hypothetical example).
Phase 1: cash-settled index futures (e.g., E-mini S&P) on Saturdays 08:00–20:00 ET.
Phase 2: extend to all CME Globex-compatible products for the full weekend.
Phase 3: physical-delivery contracts, contingent on proven delivery-warehouse liquidity.
Mandate enhanced disclosures. Require FCMs to display real-time indicative spreads and weekend margin frameworks, and to alert clients that liquidity may be materially lower until adoption matures.
Leverage modern surveillance and circuit-breaker logic. Existing Globex price-banding rules and clearly articulated halt thresholds should extend seamlessly to weekend sessions. Machine-driven surveillance (pattern-recognition of spoofing, cross-venue arbitrage) must run 24/7.
Coordinate with banking and payment rails. Work jointly with the Federal Reserve, CLS, and large settlement banks to pilot weekend funding windows; consider limited Fedwire hours or alternative real-time payment rails.
5. Bottomline
While continuous trading introduces transitional frictions—especially around liquidity provision and operational staffing—the structural benefits to price discovery, investor access, and U.S. market competitiveness outweigh those costs. Technology, automation, and global banking coverage are advancing rapidly; capital markets will be better served by embracing that trajectory rather than delaying it.
The CFTC can play a pivotal role by supervising a phased rollout, enforcing robust disclosure and surveillance standards, and ensuring clearinghouse resiliency before full 24/7 adoption. Such an approach balances innovation with prudence, delivering a marketplace that is deeper, fairer, and more aligned with the global digital economy.
Thank you for considering my views. I would be pleased to elaborate further or answer any questions.
Respectfully,
Steven Hatzakis
The opinions expressed herein are solely my own and should not be attributed to any organization with which I am or have been affiliated.
