🔵 IEX Competitive Intel
Texas Stock Exchange (TXSE) is adding an Offset Peg order type — a non-displayed order that pegs to the national best bid or offer plus or minus a user-specified offset amount, capped at a limit price. This is a standard order type already offered by Nasdaq, NYSE Arca, and Cboe BZX, and TXSE is essentially playing catch-up to round out its pegged order suite. The filing took immediate effect under the SEC's non-controversial fast-track process, meaning it is already live and does not require further SEC approval, though the SEC retains the right to suspend it within 60 days. In practice, TXSE members now have more granular control over where their resting, non-displayed orders sit relative to the NBBO, which modestly enhances TXSE's competitiveness as a trading venue.
IEX RELEVANT The filing explicitly cites IEX's own Offset Peg order (SR-IEX-2020-16) as a precedent, noting IEX 'previously offered' this order type — a subtle signal that IEX has since discontinued it. This is mildly notable: TXSE is positioning itself as building out the full suite of order types that established exchanges (including a former IEX offering) have provided, which is part of TXSE's broader effort to attract order flow and compete directly with IEX and others. As TXSE matures its product set, it becomes a more credible alternative venue for institutional order flow that IEX currently courts. However, since the Offset Peg is already widely available at Nasdaq, Arca, and BZX, this does not materially shift the competitive landscape against IEX in the near term — it is incremental table-stakes functionality rather than a novel differentiator.
FINRA, MEMX, and the newly formed MX2 LLC (a second MEMX exchange) are updating their existing regulatory sharing agreement so that FINRA takes on examination and enforcement responsibilities for broker-dealers that are members of both FINRA and either MEMX or MX2. The amendment primarily adds MX2 as a party to the existing FINRA-MEMX regulatory allocation plan, updates procedures around statutory disqualifications, and clarifies notice requirements if FINRA ever decides to charge for its services. This is a routine administrative step — the SEC is soliciting public comments before potentially approving the plan, and approval is likely given it mirrors the existing MEMX agreement. Nothing changes for most market participants; this simply extends the existing regulatory housekeeping arrangement to cover MX2 once it launches.
IEX RELEVANT The filing confirms that MEMX is preparing to launch a second exchange, MX2 LLC, which would add another competitor venue to the U.S. equity exchange landscape. While this specific filing is purely administrative, the underlying development — MEMX operating two exchanges — is strategically relevant to IEX. More MEMX venues could mean additional competition for order flow and market share. IEX should monitor MX2's eventual rule filings closely to understand its fee structure, order types, and market model, as these will determine whether MX2 meaningfully competes with IEX for flow or primarily targets other segments of the market.