About a-team Marketing Services
The knowledge platform for the financial technology industry

A-Team Insight Blogs

Nasdaq Suspends High-Speed Trading Service Amid Regulatory Scrutiny

Subscribe to our newsletter

Nasdaq has halted a high-speed trading service following concerns raised by competitors and regulatory scrutiny from the U.S. Securities and Exchange Commission (SEC). The service, which offered select clients access to lower-latency hollow-core fiber optic cables, was not publicly disclosed and had not undergone the SEC’s rule-filing process.

Low-latency network provider McKay Brothers brought the issue to the attention of regulators, alleging that Nasdaq had been offering the service to certain colocation clients for an additional monthly fee of $10,000. This undisclosed latency advantage, McKay argued, created an uneven playing field and contradicted regulatory requirements for transparency and fairness in exchange access.

In response, Nasdaq announced that it would discontinue the service. The decision highlights the competitive and regulatory pressures faced by exchanges as they seek to provide advanced trading infrastructure while maintaining compliance with market rules.

Sylvain Thieullent, CEO at Horizon Trading Solutions, shared his thoughts with TradingTech Insight on the broader implications of such technological advancements: “The trading environment has developed to a point where securing marginal gains is critical to success. Whether this is through faster execution speed achieved via infrastructure or technological upgrades, systems that can perform better during periods of high volatility, or the provision of additional insights into pre-trade analytics, traders are always looking for an edge.”

Nasdaq has also outlined plans to upgrade its data centre infrastructure, including an “Equalization Project” intended to standardise latency across colocation customers. The move is aimed at addressing concerns about preferential access while ensuring that technological improvements benefit all market participants equitably.

As exchanges continue to navigate the balance between innovation and regulatory compliance, the scrutiny over Nasdaq’s service serves as a reminder of the ongoing debate surrounding market fairness and the role of speed in trading competition.

Subscribe to our newsletter

Related content

WEBINAR

Upcoming Webinar: Post-Trade Transformation: Automating Clearing & Settlement

Date: 1 December 2026 Time: 10:00am ET / 3:00pm London / 4:00pm CET Duration: 50 minutes The UK, EU and Swiss markets move to T+1 settlement on 11 October 2027, but the first binding compression arrives almost a year earlier. ESMA’s amended settlement discipline RTS expects allocation and confirmation completed by 23:00 CET on trade...

BLOG

How AI is Reshaping the Buy/Build Calculus for Capital Markets Technology

Artificial intelligence is changing the economics of technology development across capital markets, making it faster and cheaper for firms to build their own applications. But while AI is lowering the barriers to software development, it is also raising questions about long-term ownership costs, the pace of vendor innovation and where firms should focus their technology...

EVENT

RegTech Summit New York

Now in its 10th year, the RegTech Summit in New York will bring together the RegTech ecosystem to explore how the North American capital markets financial industry can leverage technology to drive innovation, cut costs and support regulatory change.

GUIDE

Institutional Digital Assets Handbook 2023

After initial hesitancy, interest in digital assets from institutional market participants has grown over the past three to four years. Early focus inevitably centred on the market opportunities presented by bitcoin and other cryptocurrencies. But this has evolved into a broad acceptance of a potentially meaningful role for digital assets in institutional markets. It’s now...