The US Commodity Futures Trading Commission is seeking public comment on further proposals to curb high-speed derivatives trading.
The watchdog has compiled a list of 100 questions for market participants addressing all aspects of trading, from pre- and post-trade risk controls, to the design, testing and supervision of automated trading systems.
The Commission says its Concept Release is driven by Us derivatives markets' transition from human-centered trading venues to highly automated and interconnected trading environments.
"The operational centres of modern markets now reside in a combination of ATSs and electronic trading platforms that can execute repetitive tasks at speeds orders of magnitude greater than any human equivalent," says the CFTC in a statement. "Traditional risk controls and safeguards that relied on human judgment and speeds must be re-evaluated in light of new market structures."
The document is being issued in the wake of a series of market mishaps and technical glitches that have cast doubt on the ability of financial markets to keep pace with the speed of modern trading technology.
CFTC Commissioner Bart Chilton says: "In general, those involved in financial markets seem to have blindly accepted that technology is almost always a good thing...But it doesn't work well enough if we continue to see aberrations."
The regulatory body has scheduled an advisory committee meeting for later this week that will discuss to chief issues raised by the document.