Squaring the speed of light? Regulating market access in algorithmic finance. Issue 2 (2nd April 2016)

• Record Type: Journal Article
• Authors: Lenglet, Marc; Mol, Joeri
• Is Part Of: Economy and society. Volume 45:Issue 2(2016)
• Page Start: 201
• Page End: 229
• Publication Date: 2016-04-02
• Subjects: actor-network theory -- algorithm -- financial markets -- financial regulation -- high-frequency trading -- market access; Economics -- Sociological aspects -- Periodicals; Economics -- Periodicals; Social sciences -- Periodicals; 300
• DOI: 10.1080/03085147.2016.1213080
• Languages: English
• ISSNs: 0308-5147

Abstract

Abstract: We examine the sociomaterial regulation of algorithmic trading against the background of the European Union's directives on Markets in Financial Instruments (MiFID/MiFIR). Tracing the purification and translation of regulatory practices within a French brokerage firm, we examine the impact of electronic trading on the nature of market access. Central to our analysis is the 'Blackbox', a tool designed to manage market access efficiently by collating trade flows and automatically pairing them with trading algorithms. Our findings show that, through a process of 'abstracting', purification and translation are kept strictly separate, allowing the broker to meet the regulatory requirements de jure whilst retaining de facto the unregulated advantages of high-speed materiality. We discuss the implications for both the policy and practice of high-speed financial trading.