John Lothian News interviewed John Fildes of Bain & Company, Inc. of Australia at FIA Boca 2022 about the crypto space, exchange consolidation, payment for order flow and his perspective from down under. Fildes, who was formerly the CEO of Chi-X Australia, is now the capital markets practice lead and expert partner with Bain & Company.
Fildes weighed in on Jump Trading and the wormhole hack, Citadel’s getting into crypto and the 24/7 nature of the crypto business and its impact.
He also talked about consolidation in the South American exchange sector and why some of the deals failed because they only focused on trading and not post trading. Fildes also spoke about the proposed merger of the exchanges in Columbia, Peru and Chile. Shareholders at the three exchanges have all approved the merger, Fildes said. Additionally, the two exchanges in Ecuador are merging, he said, and there is an initiative to merge the exchanges in the Caribbean.
Fildes said one of the issues for the South American exchanges is that liquidity has leached from local exchanges to the U.S. in the form of ADR trading. Now those changes need to get global liquidity providers on their platforms, Fildes said. Euronext’s growth was another factor in exchange consolidation, he said.
He also spoke about payment for order flow and how it is a uniquely U.S. phenomenon. The view of regulators in other parts of the world tends to be less positive for payment for order flow, Fildes said.
The former Australian exchange leader also shared his thoughts on Cboe’s coming to Australia by buying Chi-X -Asia and how that will help drive Chi-X Australia.
Fildes mentioned that the ASX’s CHESS clearing system seems to be struggling; the CEO of ASX has announced his retirement and no replacement has been named, causing uncertainty in the Australian market space.