SEC Considers Allowing Continuous Stock Trading

The US Securities and Exchange Commission (SEC) is exploring the possibility of allowing 24-hour stock trading. This initiative aims to bridge the gap between cryptocurrency markets, which operate continuously, and traditional equity markets, which follow a set schedule.

Cryptocurrency networks, such as Bitcoin, can experience significant price swings at any time, unlike US stocks, which are only available during limited hours. The SEC is holding a roundtable discussion to address the challenges of implementing continuous trading in equities.

The main challenge lies in ensuring that the complex network of institutions behind the scenes operates with flexibility, including brokers, custodians, and clearinghouses. Currently, US equities settle on a T+1 basis, but adopting continuous trading requires settlement and related infrastructure to remain operational for longer windows without disruption.

The New York Stock Exchange (NYSE) is planning an expanded model that would operate about 23 hours per day, five days a week. However, weekends still present significant hurdles due to the closure of banks and settlement systems.