The SEC wants to scrap Reg NMS Rules 611 and 610(e), citing outdated costs. Crypto venues face parallel structure questions as regulated trading grows.
The SEC wants to scrap two rules that have governed U.S. equity trading for nearly 20 years. Proposed rescissions target Rules 611 and 610(e) of Regulation NMS, according to a Thursday filing. Rule 611, known as the Order Protection Rule, requires trading centers to route orders to venues showing better prices. Rule 610(e) governs fair access to market data. Together they shaped how exchanges, dark pools, and wholesalers interact.
The SEC argues both rules have outlived their usefulness. Markets moved fast since 2005, the commission said. Venues multiplied. Technology changed how orders flow. The Order Protection Rule now creates compliance costs that outweigh the benefits, the SEC said. Critics have made that case for years. The rule forces brokers into routing decisions that satisfy a technical check, not a price improvement goal, they said. Removing both rules at once avoids creating internal inconsistencies.
The proposal is open for public comment. No deadline has been set. The SEC asked for feedback on how the changes might affect liquidity and competition. No vote is scheduled.
For crypto markets, the move matters even though it targets equities. Regulated digital-asset venues in the U.S. are building formal market structures. They face questions about order protection, best execution, and venue competition – the same questions Reg NMS tried to answer. How the SEC handles its own rules will influence any future crypto framework, several compliance officers said. The agency's willingness to revisit old frameworks sends a signal that rule reviews are possible.
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The SEC said it is particularly interested in how removing the rules might reshape competition among trading venues. A simpler regime could lower entry barriers for new platforms, some market participants said. It could also reduce routing complexity for broker-dealers handling both stocks and crypto. The comment period gives stakeholders a chance to weigh in. Until the SEC acts, both rules stay in place.
Prepared with AlphaScala research tooling and grounded in primary market data: live prices, fundamentals, SEC filings, hedge-fund holdings, and insider activity. Each story is checked against AlphaScala publishing rules before release. Educational coverage, not personalized advice.