Now that I’m back from Seoul, here are my reflections on the WFE Clear 2025 conference. The two days I attended were packed with thoughtful discussions and frank exchanges about the future of clearing and derivatives markets. What sets these events apart is their educational nature – they establish a common language for our industry, something increasingly important as markets evolve rapidly. The refreshingly honest case studies presented allowed participants to exchange perspectives on the adoptance of Central Counterparty Clearing Houses (CCPs) and increasingly shorter settlement cycles.

CCP trends

One key session explored how to evaluate the feasibility of introducing a CCP, examining benefits, risks and implications for market structure. We identified critical enablers for successful transitions, including technological readiness, regulatory alignment, and comprehensive training for market participants.

The industry’s movement toward T+0, or at least shorter settlement cycles, was evident throughout discussions. We’re seeing 24×5 trading slowly becoming reality, with variations like 20×7 and even 24×7 in some cases. FX and crypto markets are leading this charge, though the wider ecosystem remains a significant hindrance to full implementation.

An important concept that resonated was “skin-in-the-game” for managing CCP risk – especially critical if competition is introduced. This becomes even more relevant when considering the evolving landscape of market participants.

Trading trends

An interesting revelation was that retail options trading in the US is considerably more sophisticated than previously assumed. The notion of “stupid money” deserves reconsideration, especially given CME’s recent announcement about launching smaller-sized, longer-dated futures contracts targeting retail investors in cryptocurrency and equity-index markets. We also see extensive plans for retail market engagement in Africa; I’m curious to see how this trend will play out in Europe and APAC.

According to Han, Huang, and Tang’s working paper presented at the conference, “Understanding Retail Investors’ Dynamic Trading Behavior in the US Options Market,” retail traders are seeking advanced investment vehicles that offer flexibility to either maintain positions aligned with longer-term views or more easily trade in and out of positions without frequent rolling.

DLT trends

Discussions on distributed ledger technology revealed critical gaps. A fundamental question remains unanswered: who bears responsibility when something goes wrong on a DLT or with a smart contract? The developer?

Many experts emphasised that atomic settlement doesn’t require blockchain technology. A settlement window of a few seconds is sufficient and actually beneficial as it allows for real-time netting. The consensus was clear: the industry can achieve its objectives without this specific technology in most cases.

Meanwhile, regulatory uncertainty in the US – particularly around crypto – continues to slow innovation.

Collaborating through conversation

The true value of this conference was learning from jurisdictions that have already navigated the CCP journey – gaining practical takeaways, understanding challenges, and identifying proven strategies for success. Thanks again to the World Federation of Exchanges and Korea Exchange for bringing us together. These honest conversations foster collaboration – something our entire industry benefits from.