A new foreign exchange trade association has been set up to tackle global regulations set to transform the market in the coming years.
Based in Washington DC, the Foreign Exchange Professionals Association (FXPA) will be led by Adam Cooper, senior managing director and chief legal officer of Citadel.
Its founding members include buy-side firms, exchanges and technology companies.
Among them are The Bank of New York Mellon, CalPERs, CME Group, GFI Group, LCH.Clearnet and Traiana.
CME Group’s senior managing director, global head of commodity and options products, Derek Sammann, used to head up the exchange’s FX operations out of its London office and described the establishment of the FXPA as a “watershed moment”.
“FX is facing some hurdles globally: there is historically low volatility; reputational concerns around benchmarking have led to higher levels of scrutiny; and there remains a lack of clarity around regulations,” he added.
“None of us can do anything about the cyclical factors such as volatility, zero interest rate policies or the macros, but we can more strongly represent the voice of the FX industry to positively impact the coming market structure changes resulting from unfolding market regulations, capital changes and client product choice.”
Highlighting the uncertainty around FX regulations, theTRADEnews.com reported earlier this week that clearing mandates for the asset class in the US still remain up in the air, with non-deliverable forwards and further interest rate currencies the next to be considered by regulators.