just now
BGC Group, Inc. has announced that its FMX Futures Exchange received Commodity Futures Trading Commission ("CFTC") approval to operate an exchange for U.S. Treasury and SOFR futures, the most widely traded futures contracts in the world, for trading on FMX.
Howard W. Lutnick, Chairman and CEO of BGC Group, a leading global brokerage and financial technology company, said, "With this CFTC approval, we will combine our leading Fenics UST cash Treasury platform with our FMX Futures Exchange to deliver competition across the CME's U.S. interest rate complex. For the first time, the most valuable futures market in the world will have real competition."
Howard W. Lutnick also commented, "Similar to U.S. interest rate futures, the wholesale U.S. Treasury market had historically been dominated by the CME until we launched Fenics UST. Since our launch, Fenics UST has grown rapidly, reaching 25 percent market share during the third quarter of 2023, up from 18 percent only a year ago2. We will execute the same playbook with our FMX Futures Exchange."
FMX's clearing agreement with LCH SwapClear, one of the largest holders of interest rate collateral in the world, potentially positions FMX to compete and reshape the U.S. interest rate market.
Robert Allen, President of FMX Futures Exchange, added, "FMX's global connectivity and vast distribution, combined with LCH's highly efficient cross-margin benefits will challenge CME's most valuable vertical, its U.S. interest rate complex. FMX is the first and only exchange to launch with all the tools necessary to compete and grow in the world's most important market."
Isabelle Girolami, CEO, LCH Limited said, "Our relationship with FMX is a key example of our commitment to open markets, collaboration and delivering further choice to the market. We are delighted to be working with a highly innovative exchange to bring a complete service offering across USD swaps, UST futures and SOFR STIRs to our members and clients. Our clearing capabilities will allow for portfolio margining across all these expressions of rates risk, meaningful margin efficiencies and effective risk management."
