🔵 IEX Competitive Intel
Cboe BZX filed a proposal in November 2025 to allow Intermarket Sweep Orders (ISOs) — which are typically Immediate-or-Cancel orders used to sweep multiple exchanges simultaneously — to be entered with a time-in-force other than IOC and to rest as non-displayed (hidden) orders on BZX's book. This is a new order type variant that could give traders more flexibility in how they access liquidity across venues without displaying their interest. The SEC is simply extending its review deadline from January 12 to April 12, 2026, which is a routine procedural step — it does not kill or endorse the proposal, just gives the SEC more time to evaluate it. Nothing changes for market participants yet; the proposal remains under review and could still be approved, disapproved, or sent to formal proceedings.
IEX RELEVANT A non-displayed ISO with a resting time-in-force (e.g., day or GTC) is a meaningful new order type that could attract sophisticated order flow to BZX by giving traders a way to sweep across exchanges while leaving residual hidden interest on the book — a capability that currently doesn't exist in this form. If approved, this could make BZX more attractive for certain institutional and algorithmic strategies, potentially diverting order flow away from IEX. IEX's value proposition centers on protecting investors from latency arbitrage and providing transparent, fair execution; a resting non-displayed ISO could introduce complexity that benefits speed-sensitive market makers over long-term investors. IEX should monitor whether this proposal gains traction and consider whether any analogous functionality would be consistent with its own market model.
IEX is raising its physical connectivity fee to the Primary Data Center from $4,000 to $7,000 per month, adding a new $3,000/month fee for Disaster Recovery Data Center connections (previously free), and introducing a $450/month fee per Drop Copy Port (also previously free), all effective January 1, 2026. This is an immediately effective fee filing, meaning IEX did not need SEC approval — the changes went live automatically upon filing, though the SEC retains the right to suspend them within 60 days if it finds a public interest concern. The fees bring IEX in line with or below comparable charges at peer exchanges like Cboe BZX and MIAX Pearl, and affect roughly 35% of IEX members with direct Primary Data Center connections, 11% with Disaster Recovery connections, and 28% who use Drop Copy Ports.
IEX RELEVANT This is IEX's own filing, so it directly reflects IEX's internal revenue and pricing strategy rather than a competitive threat. The fee increases improve IEX's connectivity revenue and help fund infrastructure, but they also raise the cost of direct access to IEX for a subset of members. Since IEX is already priced at or below comparable competitors (Cboe BZX at $8,500, MIAX at $8,000 for primary physical ports), this move closes the gap with peers without making IEX more expensive in relative terms. The main competitive risk is marginal: higher fees could nudge some smaller members toward third-party connectivity providers or reduce IEX's attractiveness compared to lower-cost venues like MEMX ($6,000 primary port fee), particularly for cost-sensitive participants. However, the impact is unlikely to materially shift order flow given that connectivity fees are a small component of overall trading economics.