๐๏ธ SEC Rulemaking
The SEC is proposing to rescind Rule 611 (the trade-through/order-protection rule) and Rule 610(e) (the prohibition on locked and crossed markets) of Regulation NMS, arguing that today's fast, automated, interconnected markets no longer need these rules and that they have driven exchange proliferation, fragmentation, complexity, and cost. This is a proposed rule with a comment period ending August 17, 2026 โ it is not yet binding and could be modified or abandoned; the SEC is also soliciting comment on related knock-on changes to best execution, market data revenue formulas, SRO rules, and Rule 610(c) access fee caps. If adopted, trading centers would no longer be required to prevent trade-throughs of protected quotations or avoid locking/crossing markets, potentially reshaping order routing, quoting incentives, and competition among exchanges and off-exchange venues.
IEX RELEVANT Rescinding Rule 611 removes the intermarket price protection that underpins IEX's competitive positioning and the value of its protected quote, while eliminating the locked/crossed prohibition and the 'automated quotation' framework could directly implicate the treatment of IEX's 350ฮผs speed bump and D-Limit order type, making this an existential market-structure change IEX must engage on aggressively.
โฐ Comments close 2026-08-17
๐ต IEX Competitive Intel
24X National Exchange, a newer equities venue, is adjusting its liquidity rebates: cutting the rebate for non-retail displayed adds (from $0.0034 to $0.00295) while raising the rebate for non-displayed adds (from $0.0025 to $0.0027), aiming to attract more order flow and build market share. Notably, the exchange is running at 'zero net capture' on non-retail displayed adds โ paying out the same rebate it charges to remove that liquidity โ as a loss-leader to bootstrap participation. As an immediate-effectiveness fee filing, the change took effect on June 1, 2026 without needing SEC approval; the SEC could suspend it within 60 days but rarely does for routine fee tweaks, so this is effectively live and operative.
IEX RELEVANT A small competitor exchange aggressively using zero-net-capture rebate economics to win order flow signals continued fee-driven competition for liquidity that IEX must monitor, though IEX's non-rebate, investor-protection model is less directly threatened by these incremental changes.
Texas Stock Exchange (TXSE) filed a proposal to amend parts of its Opening and Closing Auction rules, and the SEC is extending its review deadline from June 13 to July 28, 2026 to give itself more time to evaluate the proposal. This is a routine procedural extension โ it does not kill the proposal or signal disapproval; it simply means the SEC needs more time before deciding to approve, reject, or open a formal review process. For market participants, nothing changes yet โ TXSE's auction mechanics remain as-is until the SEC makes a substantive decision.
IEX RELEVANT TXSE is a direct competitor exchange entering the market with its own auction mechanisms, and how the SEC shapes TXSE's opening/closing auction rules could affect competition for listed company auctions and order flow that IEX also seeks to capture.
๐ Other Notable Filings
Nasdaq wants to loosen its generic listing standards for commodity-based trust shares (a type of ETP) by allowing up to 15% of holdings in digital commodities or securities that don't otherwise qualify, defining 'digital commodity' in line with recent SEC/CFTC crypto guidance, and permitting actively-managed (not just passive) strategies. The SEC published Nasdaq's amended proposal for comment and extended its own decision deadline to July 27, 2026 โ this is a routine procedural step that pauses the clock to give the SEC more time to evaluate, not a sign of approval or rejection; the proposal remains alive and pending. Nothing changes yet for issuers or investors, but if approved it would make it faster and easier to launch crypto and actively-managed commodity ETPs on Nasdaq without case-by-case SEC review.