TeraExchange joins the short but growing list of those which have filed applications with the Commodity Futures Trading Commission (CFTC) to become a Swap Execution Facility (SEF). So far GFI, Bloomberg, MarketAxxess, Truex and Tradeweb are the other platforms to have registered.
Christian Martin, TeraExchange CEO, said, “We are committed to being a leading SEF by delivering the most transparent and innovative marketplace available. We are providing customers across the entire marketplace with a robust solution that has been tailored to meet the new regulatory requirements as well as the myriad needs of traders.”
The financial instruments market participants will be able to trade on TeraExchange include Interest Rate Swaps, Collateralised Default Swaps (CDS) Indices, CDS Options and Single Name, Non-Deliverable Forwards and other cleared OTC products.
Dodd-Frank requires all US financial transactions to clear their swap trades with central counterparties, and transact them on an SEF - or a Designated Contract Market for non-security-based swaps. The deadline for CDS and interest-rate swaps has already passed, and financial institutions should comply with the guidelines for other brands of swap by September 2013.