The Committee on Capital Markets Regulation submitted a comment letter on the Proposed Rule released by the U.S. Commodity Futures Trading Commission regarding Regulation Automated Trading. We are supportive of the Proposed Rule’s stated purpose to reduce the risk that algorithmic trading will cause trading disruptions. However, we are concerned that the Proposed Rule’s requirement that covered entities make their source code available for discretionary inspections lacks a sound legal basis; departs markedly from the approaches taken by other financial regulators; and creates serious cybersecurity risks. We recommend the creation of a separate process for source code access.

Read the full comment letter here.