On May 6, 2020, the U.S. Securities and Exchange Commission (“SEC”) issued an order that required equity exchanges and FINRA to submit a new National Market System (“NMS”) plan with a modernized governance structure for the production of public consolidated equity market data and the dissemination of trade and quote data. As explained in its order, the SEC hopes that a consolidation of equity market data systems will help to eliminate duplicative systems and reduce lags in data dissemination as well as data inaccuracies.

On May 4, 2020, the U.S. Securities and Exchange Commission (“SEC”) approved MEMX LLC (“MEMX”), standing for “Members Exchange,” as a new national securities exchange under Section 6 of the Securities Exchange Act of 1934. According to the MEMX website, the investors in MEMX include global financial institutions, comprised of online retail broker-dealers, global banks and financial services firms, and global market makers. MEMX will operate a fully automated electronic order book, and will not operate a physical trading floor. Similar to other national securities exchanges, only broker-dealer members of MEMX and entities that enter into market access arrangements with members will have access to the MEMX system. As a national securities exchange, MEMX will be a self-regulatory organization and will be responsible for oversight of its members.

In the midst of the COVID-19 pandemic, the financial markets have experienced significant volatility. During the course of this volatility, exchanges have halted trading multiple times after declines in trading trigged circuit breakers. In addition, trading floors are transitioning to electronic trading in efforts to prevent the transmission of COVID-19 on physical trading floors. With the recent turmoil, this post provides a high-level summary of the various types of circuit breakers and what can be expected.