Comment Text:
I submit this comment to the Commodity Futures Trading Commission (the “Commission”) on behalf of Polygon.io, a financial data infrastructure company that provides real-time and historical market access for equities, options, forex, indices, cryptocurrencies, and soon, futures. Our diverse customer base, from large institutions to retail-focused platforms, relies on our ability to deliver market data across asset classes through unified, modern APIs. As we have commented on round-the-clock trading proposals in the equities markets, we firmly believe that a thoughtful and deliberate move towards round-the-clock markets is not only a logical progression driven by technological capability and market demand but also a necessary step to reinforce the competitiveness, resilience, and integrity of U.S. financial markets.
The notion of “everything now” has permeated nearly every aspect of modern life, and financial markets are increasingly pressured to adapt. Despite shifts in technology, financial market participants and regulators have been able to maintain artificial temporal boundaries on trading venues. Still, the market is signaling a desire to move beyond this. 24/7 trading hours in U.S. equities are on the horizon. We see Alternative Trading Systems, such as Blue Ocean and Bruce ATS, already offering overnight sessions, and national securities exchanges, such as 24X, NYSE Arca, and Nasdaq, are actively pursuing and receiving approval for near 24/7 operation. Notably, last week, the Securities Information Processors (the “SIPs”), the backbone of public equities market data dissemination, announced its intention to propose near 24/7 operating hours to the Securities and Exchange Commission. As the SEC has made clear through its approvals of 24x’s and NYSE Arca’s applications for extended trading hours, equities venues will be able to move to 24/7 trading once the SIPs are ready. This development in the equities space clearly indicates the broader market’s direction and the foundational role that continuous data availability plays in enabling it.
This trend towards continuous market hours is perhaps most acutely relevant when examining cryptocurrency markets. As the Commission has rightly recognized, many major cryptocurrencies are commodities under the Commodity Exchange Act. Yet, while the underlying spot crypto markets trade 24/7 globally, U.S.-regulated futures markets for these commodities largely do not match that availability. While venues like CME currently offer crypto futures, their trading hours are not continuous like the underlying spot markets or many offshore derivatives platforms. We acknowledge recent steps, such as Coinbase's announcement of 24/7 trading for certain Bitcoin and Ethereum futures. This development is a clear indication that 24/7 derivatives markets are indeed feasible from a technological and operational standpoint. However, it is important to note that these are currently futures contracts with expirations, and critically, perpetual futures remain a "view-only experience" for US users. This highlights that the most continuously traded and often highest volume crypto derivatives products, like perpetual futures, are still not fully accessible within the regulated U.S. market structure. This mismatch has tangible consequences. It contributes to regulatory arbitrage, pushing significant liquidity and innovation, particularly in products like perpetual futures, onto offshore platforms operating with potentially fewer regulatory controls and outside of U.S. oversight. The reported interest of U.S. firms, such as Coinbase, in acquiring major offshore venues like Deribit, which explicitly prohibits U.S. participation, underscores how much activity and expertise currently reside beyond the direct reach of U.S. regulators. This status quo is not conducive to U.S. leadership in financial innovation or effective oversight. Enabling 24/7 derivatives trading, especially for crypto-based products, is essential to bring this activity onshore, aligning U.S. regulated markets with global price discovery and risk management needs, and ensuring these markets operate under the Commission's watchful eye.
The Commission’s Request for Comment thoughtfully probes the critical operational and regulatory challenges inherent in a shift to 24/7 trading and clearing. From Polygon’s perspective, these challenges are fundamentally tied to the need for continuous, reliable data flows. Continuous trading demands continuous data availability and integrity. Designated Contract Markets and Swap Execution Facilities must evolve their systems from those designed for scheduled downtime to high-availability architectures capable of seamless live deployments, robust patch management, and rapid rollback mechanisms. The ability to conduct essential system safeguards testing, business continuity planning, and capacity management in this environment is directly contingent on having access to continuous, accurate data feeds that mirror live market conditions. These are not insurmountable obstacles; modern technology is well-equipped to handle the demands of 24/7 operation. The challenges are primarily technological problems with proven solutions in other industries and markets.
Enabling 24/7 trading and clearing of derivatives is a necessary evolution for U.S. financial markets, particularly given the increasing interconnectedness and global nature of trading. The recent move by equities market infrastructure, such as the SIPs, towards near 24/7 operation clearly signals this trend and the underlying market demand. Given the significant correlation between equities and many derivatives products, the futures market must align its trading hours to allow market participants to manage their exposure and access liquidity continuously across these related asset classes. The success of this transition hinges on implementing a comprehensive and reliable 24/7 data infrastructure, ensuring continuous system resilience, powering real-time market surveillance, and providing the necessary data for robust risk management around the clock. Polygon stands ready to partner with the Commission and market participants to offer the data solutions needed to support a safe, transparent, and efficient 24/7 derivatives marketplace.
I appreciate the Commission’s willingness to consider public input on this issue and can provide further commentary as needed.
