Wall Street Eyes the Clock: NYSE Contemplates 24/7 Trading to Rival Crypto

The New York Stock Exchange (NYSE), under the stewardship of its owner Intercontinental Exchange (NYSE:ICE), is contemplating a transition towards round-the-clock trading.

The NYSE is aware that its current market structure, with its set business hours and iconic opening and closing bells, might be leaving money on the table by not catering to the around-the-clock trading appetite demonstrated by the rising demographic of retail investors. A potential shift toward a 24/7 operation could be seen as a push to directly compete with cryptocurrency exchanges, notorious for their continuous trading activity. But will Wall Street really break against time and tradition?

This modern crave for constant market access has seen a notable surge in recent years, particularly among retail traders who value the flexibility to trade outside the traditional 9:30 AM to 4:00 PM Eastern Time window. To harness this momentum, the NYSE is exploring the expansion of its services to offer after-hours trading options that could potentially keep the exchange active 24 hours a day, seven days a week. If this comes to pass, international traders may rejoice at not having to set their schedules by EST any longer.

Any potential transformation does not come without its complications, and this being a very significant consideration will have more issues to resolve than most.

One of the primary concerns is liquidity—or the potential lack thereof—during the off-hours when fewer market participants are typically active. The difficulty in finding buyers and sellers for stocks during night-time hours, for example, could lead to poor execution and wider spreads.

A further worry is the complex issue of settlement risk that multiplies within a non-stop trading environment. The intricacies involved in settling trades become even more pronounced in a market that never sleeps, particularly when dealing with international transactions that must navigate across different time zones and regulatory landscapes.

Despite these challenges, experts exhibit a cautious optimism regarding the benefits of a continuous trading paradigm. A shift to 24/7 trading could foster heightened engagement among investors and provide access to a global investment landscape that matches the ever-increasing international nature of business and finance.

The possibility of a future devoid of the iconic NYSE opening and closing bells signals a radical departure from tradition yet also underscores the mounting pressure traditional exchanges face to innovate, where the decentralised and ‘always-on' model of cryptocurrencies is increasingly setting new expectations.

The ultimate verdict on whether Wall Street will indeed share the stars with the crypto world remains hanging in the balance, as the NYSE's discussions progress and it meticulously weighs the desires of investors against the logistical hurdles of a 24/7 trading landscape. We don't see it happening anytime soon, but to be forward looking is not a bad thing.