Nasdaq poised to launch FX trading platform, says top executive

Nasdaq is poised to launch a platform for foreign exchange trading which it says would make the US$5 trillion-a-day global market more transparent and would diversify its own business, a top executive from the stock market operator said on Monday.

Nasdaq co-president Hans-Ole Jochumsen, one of two presidents who are both second in command of the tech-oriented stock market operator, said the foreign exchange trading platform is ready to be tested with banks although a launch was more likely next year. 

Authorities in the United States and Europe have fined major banks more than US$10 billion for failing to stop traders from trying to manipulate foreign exchange rates on the largely unregulated foreign exchange market.

"There are two main problems in retail FX markets. How can customers be sure they receive the correct price and secondly the counterparty risk," said Jochumsen, also the head of Nasdaq’s transaction business.

"The criticism of banks and the fines show the market is not transparent and compliant and it speaks for it to be organised more like a stock market," Jochumsen said at the stock exchange in Copenhagen which is owned by Nasdaq.