IEX, a private trading venue designed to prevent high frequency traders from scalping, will officially launch as a stock exchange on Friday. IEX was depicted by Michael Lewis as a team of crusaders fighting a rigged system in his 2014 book 'Flash Boys.' IEX is backed by investors including mutual funds, hedge funds, and VCs.
IEX’s transition from a private trading venue, known as a dark pool, with a less than 2 per cent share of daily trading to a fully regulated exchange may also reflect changes in how US exchanges and the broader market operate. “We are ready,” Bradley Katsuyama told the FT at IEX’s offices two weeks before the launch. Looking happy and relaxed in the classic sleeveless fleece vest of a trader over a button down-shirt with the sleeves rolled up, the IEX chief said he feels a lot less stress now. The application process lasted months and was marked by a bitter debate among industry participants about whether IEX’s speed bump, designed to slow trading, was permissible under market rules.