The share of US Treasury trading volume carried out electronically bottomed out at 31% in the midst of the global financial crisis but has steadily recovered to hit 48% this year. Greenwich expects the trend to continue, topping 50% soon given the fact that four out of five institutional investors have now embraced e-trading for at least some portion of their Treasury business.

In contrast, the short-term fixed-income market, which experienced a similar falloff in e-trading activity during the crisis, hasn't recovered as quickly. After peaking at 42% in 2008, the share of short-term fixed income trading volume executed electronically now stands at just 30%.

Having fought each other over the last few years, Bloomberg and TradeWeb dominate both markets. They are evenly matched in market share, with Bloomberg pulling slightly ahead in terms of penetration.

Bloomberg has worked aggressively to improve its platform and educate its 300,000 terminal customers that they can trade Treasuries electronically at no additional charge, says Greenwich. Tradeweb has focused on upgrading its platform and offering high-touch service to its traditionally real-money client base.

Kevin McPartland, head, research for market structure and technology, Greenwich Associates, says: "Looking ahead, with dealers re-evaluating how and how much liquidity they provide to clients, and investors putting ever more focus on best execution, a continued examination of trading venues and protocols is inevitable, and we expect dealer-to-dealer platforms to slowly enter the client-execution space as well."