The Wall Street Journal reports that the IEX Group is set to receive an approval from the U.S. Securities and Exchange Commission (SEC) to become an exchange. With a number of high-frequency trading companies lobbying against the bid, the IEX has faced substantial challenges and delays for its application to get approved.
Sources with knowledge of the matter cited by the Wall Street Journal have stated that the staff of the SEC that is looking into the IEX bid has recommended that the application be granted.
The IEX Group became notorious in the aftermath of the publication of the book “Flash Boys” by bestselling author Michael Lewis. The controversy in the bid of the trading venue led by Brad Katsuyama is that trades have been artificially slowed down in order to prevent front running by high frequency trading shops.
The high-frequency trading lobby has heavily committed to blocking the bid of IEX to become an exchange. According to the WSJ article, the last ditch effort was made by the founder of Citadel LLC Kenneth Griffin, who personally met with the SEC’s Chairman Mary Jo White.
The approval of IEX would make it the 13th exchange in the United States and the first one that gets the green light after a multitude of venues that are now owned by BATS Global Markets got licensed as exchange operators back in 2010.