Niki Beattie

“There is little basis for most of the feedback and […] and many of the comments are surprising, given that they are based on, and sometimes contradict, the exchanges’ own publicly available information,” said MSP in its latest report.

Among the most vocal in their responses to MSP’s February report entitled ‘There’s No Market in Market Data’ were Euronext, LSEG’s Turquoise and the Federation of European Exchanges (FESE). Wednesday’s comments focus on these three entities.

MSP’s original conclusions suggested that exchanges were supplementing suffering equity market revenues with soaring market data prices, despite the accusation of there being ‘no specific costs for producing market data’.

Exchanges immediately hit back, calling the findings “inaccurate” and “misleading”. However, in today’s latest report, MSP has individually responded to every complaint, reaffirming its original stance and calling for action by regulators.

Read more – Exchanges hit back at ‘inaccurate’ and ‘misleading’ accusations around market data costs

“Market data pricing should reflect exchanges’ actual fixed costs of production – not arbitrarily capitalise on consumers’ variable usage and dissemination patterns,” said Niki Beattie, chief executive of Market Structure Partners.

“When these unjustified charges are removed, the facade of a standalone market data business crumbles, confirming our original conclusion that data is simply a by-product of trading.”

There are some areas where MSP has re-clarified figures. In Wednesday’s report, the market structure specialists acknowledge specific feedback from exchanges regarding Turquoise and LSE disclosures, as well as Euronext’s reporting methodology, where they presented their 2020 market data revenue (MDR) percentage against total group revenue rather than total trading revenue, as required by regulation.

However, it has reiterated that despite these areas of feedback, the conclusions of its original findings have not changed.

The exchanges

Euronext made several complaints against the original report. However, most central was the suggestion that the basis for its conclusion – namely that exchanges offsetting declining equities volumes with market data cost increases – was incorrect.

“The report claims that the share of market data revenues over the total revenues of Euronext has increased from 11% to 19%, when in reality […] this ratio remained stable over the period at 11%,” said Euronext in its response to the original report.

MSP in Wednesday’s findings acknowledged that the 2020 disclosure had a denominator footnote that it had not seen and that it would update the report to include this.

Read more – Some exchanges pocketing nearly £5 billion from ‘inexplicable’ market data price rises, finds report

It reiterated however, that: “it does not change the fact that the disclosures in the following years used a more correct denominator which shows that market data revenue is increasing as a % of total trading revenue and that this has risen from 17% in 2021 to 19% of total trading revenue by 2023.”

Euronext also took issue with the fact that it was not contacted for the report, that it was inaccurate as it did not reflect Euronext’s acquisition of three new markets, and that it was an incorrect representation of Euronext’s customer base.

In response to these claims, Beattie and Market Structure Partners have reiterated that the report is based off of publicly available data, that the exchange had no issue with similar figures and findings used by Oxera in their reports in 2024, and that a universal definition of a customer should be agreed upon across venues and that a customer count should be disclosed on an annual basis.

The exchange also took issue with the examples used through either suggesting they were erroneous, unrealistic or unrepresentative. MSP’s report addresses the findings and reiterates its original methodologies.

The need for industry-wide dialogue

“The intensity of debate following the report’s publication only reinforces its significance and the need for a constructive industry-wide dialogue about creating markets that work efficiently for all participants,” said Mike Bellaro, chief executive of Plato Partnership.

Plato Partnership co-commissioned the original independent study published by MSP.

Also vocal in their rejection of the February findings was LSEG’s Turquoise. The trading venue took issue with several areas, including that the report misrepresented its volumes by suggesting they had decreased, misrepresented its pricing and was “flawed” with respect to documentation published by LSEG venues, grouping Turquoise with other primary exchanges instead of other pan-European MTFs.

MSP said in its response that it had only used Turquoise market data revenue disclosure figures as it could not find LSEG ones. MSP has subsequently removed Turquoise’s disclosure information and replaced it with LSE’s 2019 – 2022 disclosures.

“As stated, exchange disclosures are hard to find and, in the case of LSE, are published two years in arrears,” said MSP.

“We have since been provided with LSE disclosures and, therefore, retract the statement that only Turquoise Europe makes reasonable commercial basis disclosures. We propose to replace the Turquoise disclosures with those of LSE, so that all exchanges are compared on a like for like basis.”

It does, however, reinstate that despite the new figures it does not change the original findings released in February suggesting “MDR [market data revenue] growth has far outstripped the changes in turnover”.

Similar to its response to Euronext, MSP has flagged that LSEG’s Turquoise did not take issue with similar figures published by Oxera in its 2024 report.

LSEG’s Turquoise also took issue with MSP’s avatar used to simulate some of its findings in its original report, suggesting that it had created exaggerated figures. It also suggested that MSP had not taken into account that Turquoise had waived certain charges including private investor data charges throughout the acclaimed period. MSP’s report addresses these claims.

FESE response

FESE’s complaints with the report included that it contained factual errors, its proprietary method had been “tweaked”, contained issues around the calculation of data fee increases and had unfounded assumptions on IT infrastructure expenditure.

The association also took issue with MSP’s insufficient reasoning for price list expansion and misleading claims of unfair behaviours against direct competitors.

MSP’s Wednesday response suggests many of these claims are “unsubstantiated noise”.

Similar to its response to Euronext and LSEG, the firm has questioned why FESE took no issue with Oxera’s findings in 2024 – also noting that these had changed significantly from 2019 without any explanation.

MSP said Oxera claimed in 2019 the MDRs were ‘stable’ at €245 million, but in 2024 it revised the MDRs up to €298 million. “This is not a small tweak. It is a 21.63% increase […] which does not suggest revenues are stable, but there was no explanation of recognition of this change,” said MSP on Wednesday.

Regulatory recommendations

Beattie and MSP have suggested a list of recommendations that regulators should implement going forward to avoid any future lack of correlation in the numbers. Namely: ESMA and the FCA should keep an up-to-date repository of all trading venue and data service provider market data disclosures for their respective regions.

Trading venues and data service providers should log their disclosures in the repository of their respective regulators and should publish disclosures as soon as their annual accounts are published for the previous year.

The report also suggests that disclosures should be checked for consistency, that the definition of customer should be agreed and that cross-referencing disclosures to annual accounts should be possible and links should be explained.

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Named the BondVision Dealer-to-Client (DCT), the newly launched offering is a multi-dealer buy– and sell-side focused protocol that covers rates, credit and repo.

The offering was developed as part of the BondVision partnership announced by Euronext’s MTS in September last year.

Read more – Euronext’s MTS partners with BondVision on growth initiative launch

 “The BondVision Partnership was established to improve market efficiencies, increase liquidity and promote market competition,” said Patrick Whelan, global head of FICC digital markets at JP Morgan.

“As early supporters of this growth initiative, leading the adoption of the new DCT protocol further underscores our commitment to fostering innovation. By automating the process trade workflows, dealers can now focus on delivering service to clients, ultimately improving our capacity to serve clients with greater precision and speed.”

MTS and BondVision confirmed that the new protocol will “address key operational challenges and enhance efficiencies in processed trade workflow through automation”.

Dealers can send processed trades to clients via an API. MTS said dealers will drive the process to book risk internally and dispatch processed trades to their clients. Dealers can also input trades via the MTS BondVision sales GUI.

 “As part of Euronext’s ‘Innovate for Growth 2027’ strategic plan, MTS is committed to innovation in fixed income trading by continually developing its technology offering to meet the evolving needs of the market,” said Angelo Proni, chief executive of MTS.

“DCT has been specifically developed as part of the BondVision Partnership and provides an elegant, functional solution to support our strategy.”

MTS said the service will remove the need for manual trade entry of ticket fields for clients, improving STP connectivity.

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The offering provides users direct two-way connectivity to consume CCP information and instruct collateral movements across its network. Through the move, Baton Systems’ client can now use automated workflows which are powered by real-time data to optimise margin for Euronext derivatives and options.

These products were previously cleared through LCH SA but have now migrated onto Euronext Clearing.

Read more: Euronext agrees to sell LCH SA stake for €111 million as part of ongoing clearing migration

With the addition of Euronext Clearing, Baton’s CCP coverage now includes 96% of initial margin worldwide (as per Public Quantitative Disclosures).

Arjun Jayaram, founder and chief executive of Baton Systems, said: “By adding Euronext Clearing to our Core-Collateral network, we’re enabling our clients to improve efficiency, transparency, and decision-making at a critical time in the post-trade process. This advancement further solidifies our position as a trusted partner for clearing members, financial institutions, and collateral managers across the globe.”

Baton’s CCP connections allow users to access up-to-date balance information, including intraday and end-of-day positions. This can be subsequently aggregated with access to up-to-date eligibility schedules for all connected CCPs.

The information can wither be integrated into a clients’ internal system using APIs or accessed directly through Baton’s platform.

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Stephane Boujnah

The three markets join Euronext markets in Lisbon, Milan and Oslo, which Euronext Securities already provides support for.  

The exchange said the move comes as part of Euronext’s goal to improve European capital markets’ competitiveness, tackle post-trade fragmentation in Europe and open up new trading and investment opportunities, particularly across borders. 

At present, the settlement of equity trades in Europe is fragmented across over 30 different CSDs. 

Read more: Strong trading revenues sees Euronext achieve double digit revenue growth 

This move also coincides with developments in 2023 in which Euronext migrated its markets clearing activities to Euronext Clearing.   

Clients will now have the ability to consolidate settlement of equity trades, and related custody activities, for a number of local markets in one single CSD.  

The integrated model claims to offer clients improved post-trade operations, enhanced liquidity and simplified market access across Europe, the venue stated. 

In addition, the exchange claims that clients will benefit from easier adaptation to regulatory changes, in particular during the preparation for the move to T+1 in Europe in October 2027.  

“Euronext today demonstrates its commitment to improve the competitiveness of European capital markets by proposing a single access point to the settlement activity in Europe through Euronext Securities,” said Stéphane Boujnah, chief executive and chairman of the managing board at Euronext.  

“[…] Euronext with its European single trading platform and single liquidity pool gathering 25% of European equity trading activity, is uniquely placed for this strategic move to expand Euronext Securities settlement in Europe, after the successful migration of its clearing activity in Euronext Clearing.” 

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This initiative aims to enhance market interoperability and encourage competition within European financial markets. Through expanding its clearing services, SIX seeks to improve market efficiency, reduce counterparty risk, and streamline trading operations. 

Starting in March 2025, trades executed on Euronext markets in these locations will have access to SIX x-clear’s preferred clearing services, with Euronext Italy scheduled for integration by Q2 2025.  

Laura Bayley, head clearing services at SIX, said: “This expansion of our connected platforms marks a significant achievement for SIX. We are pleased to further demonstrate our commitment to enhancing efficiency and creating value for our members.”  

Bayley added: “By offering an additional choice of CCP, we are confident that this will boost transparency, sustainability, and resilience within the financial sector.”  

SIX will utilise its clearing infrastructure and risk management systems to facilitate secure and efficient trading across Europe.  

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In the first instance, futures contracts will be introduced on the Euronext Derivatives Milan market – with contracts focused on European government bonds including: Italy’s 10-year and 30-year BTPs, France’s OAT, Germany’s Bund, and Spain’s Bono. 

Specifically, the offering introduces the first mini futures cash-settled on European government bonds – specially designed with retail investors in mind. 

The move provides both asset managers and private investors increased granularity for hedging as well as taking exposure to government bonds. 

Anthony Attia, global head of derivatives and post-trade, Euronext, said: “The launch of our fixed income derivatives is a pioneering step that highlights Euronext’s commitment to innovation and client-centric growth. By entering this critical market segment, we respond to the needs of investors who seek diversified opportunities and competitive solutions.

“[…] This is a significant step forward in our strategy to expand our derivatives franchise, realising our vision of driving growth and efficiency across Europe’s financial ecosystem.”

Read more: Fireside Friday with… Euronext’s Anthony Attia

The new derivatives products are set to go live in September 2025 and trades are set to be cleared by Euronext Clearing.

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Stephane Boujnah

The trading venue saw full year revenue and income up 10% from 2023, totalling €1,627 billion.

Overall trading revenue contributed towards this, growing 14% year-on-year to €559 million, driven by strong results within its fixed income and FX divisions, as well as solid growth in cash trading revenue.  

Fixed income trading saw the largest year-on-year gains, up 36% and totalling €146 million compared to €107 million in 2023.  

The venue also posted positive results in FX trading revenues, which were up by 24%, reaching €32 million in the full year of 2024 compared to €25 million in 2023.  

Strong FX trading revenues were tied to a favourable volatility environment, Euronext stated.  

In a similar vein, cash trading revenues were up 7%, totalling €284 million in 2024, when compared to €265 million in 2023. 

Read more: Positive revenues from Euronext trading segments sees overall revenue rise year-on-year 

However, offsetting the gains in trading revenues was derivatives trading, which saw a 2% decline year-on-year from €54 million to €53 million.  

Euronext attributed declines in derivatives trading revenues to the continuing trend of lower volatility for equity and index derivatives, offset by dynamic commodity trading. 

Elsewhere, within Euronext’s post-trade business, total revenues were up 12%, achieving €415 million.  

Clearing revenue also saw positive figures, growing 19% to €144 million, which the venue attributed to the European expansion of Euronext Clearing, as well as dynamic fixed income activity. 

“In 2024, we delivered double-digit topline growth thanks to the solid performance of non-volume related activities, excellent performance of FICC trading, and the successful clearing expansion in Europe,” said Stéphane Boujnah, chief executive and chair of the managing board of Euronext.  

“[…] In 2025, we are building the foundations to achieve our 2027 growth targets and we are investing to innovate for growth.” 

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Anthony Attia

The development comes as part of Euronext’s plan to expand its Italian repo clearing franchise to a wider range of European government bonds.  

As part of the move, Euronext Clearing will use Euroclear as its first triparty agent to allow for improved collateral management capabilities.  

Through the use of Euroclear’s solutions, Euronext Clearing will provide clients with automated and flexible collateral solutions, helping to improve operational efficiency and margin and balance sheet optimisation.  

Euroclear will operate as an independent third party, managing the selection, valuation and substitution of collateral, ensuring that it meets eligibility criteria. 

In addition, Euroclear will handle settlement and custody, provide regular reporting and ensure regulatory compliance, with the aim of allowing clients to benefit from improved liquidity management and a reduction in burdens associated with administration.  

“This partnership marks a significant milestone in Euronext’s ‘Innovate for Growth 2027’ strategy, reinforcing Euronext Clearing’s role as a cornerstone of the group’s broader strategic ambitions,” said Anthony Attia, global head of derivatives and post-trade at Euronext.  

“It demonstrates our commitment to delivering best-in-class clearing and collateral management solutions for our clients.” 

Collaborating with Euroclear will come as part of the release of Euronext’s new repo clearing offering in June 2025, enabling the onboarding of clients with an updated risk framework.  

The firms added that clients will be able to use Euroclear as a triparty agent for repo clearing. 

Read more: Euronext bolsters European derivatives offering with German, Irish and Portuguese single stock options 

“Strengthening collaboration between market players is crucial for growth and stability in European capital markets,” said Marjie Verhelst, head of product strategy and collateral management and securities lending at Euroclear. “This initiative highlights the vital role of our global and neutral infrastructure in helping our clients optimise their collateral allocation, reducing fails and credit usage, and increasing flexibility and predictability for dealers.” 

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Released today, the new report by Market Structure Partners (MSP) entitled ‘There is no Market in Market Data’ revealed findings that suggest incumbent venues are supplementing dwindling equity market revenues and volumes with hikes in market data pricing, ultimately leading to what the paper calls “stifling of growth and innovation”.

Among the exchanges listed in the report are Euronext, Deutsche Börse, the London Stock Exchange Group’s Turquoise and Nasdaq Nordics.

Read more – Some exchanges pocketing nearly £5 billion from ‘inexplicable’ market data price rises, finds report

“The data presented in the report contains multiple errors and does not accurately present Turquoise’s trading volumes and market data costs,” said a spokesperson for LSEG.

“The conclusions drawn in the report are therefore inaccurate and we will be contacting MSP to request the necessary extensive corrections throughout.”

One example of an inaccuracy in the findings noted by LSEG are figures relating to its private investors data fees. The report claims that LSEG has increased its data fees for private investors by over 150% between 2017-2024.

“Market data for retail investors on Turquoise has always been free and there was no change in the LSE data charge for this community over this period,” continued the LSEG spokesperson. “Since January 2025, LSE fees for market data for retail have also been waived. Furthermore, all of LSEG’s equity trading entities are required to make Reasonable Commercial Basis disclosures.”

At the heart of MSP’s findings released on Tuesday is the claim that market data – which MSP argues should be a by-product of trading volumes – has grown to become a far larger revenue stream than it should be that is supplementing other business areas such as trading that are suffering from a lack of innovation and attention from exchanges.

In its findings, MSP claims that trading turnover on LSEG’s Turquoise reduced by 61% between 2020 and 2022. However, in the same period, market data revenues increased by 16.5%, according to the report.

Naming other specific venues, the report also found that between 2020 and 2023 – despite total equity markets transacting value reducing by 17% – Euronext only saw total equity market revenue decline by 0.5% thanks to an 8% uptick in market data revenue.

“An independent analysis commissioned by FESE and published by Oxera in September 2024, shows exchanges market data pricing remains reasonable, reflecting shifts in data consumption, evolving fee structures, and broader industry costs,” a Euronext spokesperson told The TRADE in response to the report.

The MSP report also names Deutsche Börse and Nasdaq Nordics.

In its findings it suggests that between 2020 and 2023, Deutsche Börse saw transacted value in equity markets reduced by 29%. Total equity market revenue, however, only declined by 12% due to a 10% increase in market data revenue.

The research on Nasdaq Nordics tells a similar story, seeing a 27% reduction in transacted value in equity markets between 2021 and 2023 but only seeing a 9% decline in total equity market revenue stemming from a 4% rise in market data revenue.

“The claim that exchange data fees are increasing is misleading; any price increases have been below inflation over the same period, and we are fully committed to fair and transparent pricing,” a spokesperson for Nasdaq Nordics told The TRADE.

“We are relentlessly focused on innovation and enhancing the resilience of our world class markets and data services, to ensure they keep up with the accelerating pace and sophistication of trading.”

Deutsche Börse did not respond to a request for comment at the time of publication.

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As we bid farewell to 2024, we are left with many questions about the dawn of 2025, a year that promises to be a game-changer. We already have key milestones within the ever-fluid EMEA regulatory landscape, including DORA and implementing the Mifid II and Mifir review. We will likely witness further regulatory divergence between the UK and the EU. Still, all parties must act swiftly to address the macro-level challenges affecting primary market listings and the lack of investment in the EMEA region. It is imperative that action is taken on all fronts. 

We should finally see, on a grander scale, AI usage moving from an over-used buzzword bingo to a reality. The pursuit of innovation will persist, with new entrants needing to demonstrate credible and distinctive credentials in a highly competitive and demanding environment, where only those that offer something unique will ultimately endure.

As the industry moves towards a consolidated tape and the looming T+1 deadline, established players will likely continue positioning themselves to expand their market share or protect their existing trading, data, and technology businesses. This is set against a backdrop of rising industry costs, which will inevitably face heightened scrutiny.  Liquidity sweet spots like retail, blocks, bilateral and VWAP crossing will again dominate many liquidity discussions. The bilateral debate will likely persist, and we can expect engaging discussions from industry participants and regulators. 

Furthermore, the ‘Trump effect’ looms on the horizon; this could exacerbate market volatility in the year ahead, a reality that will soon become apparent. In 2025, we must challenge existing workflows and the status quo to innovate and compete globally. We all have a role to play in establishing the EMEA ecosystem as a model of excellence for the global trading community next year and beyond.

Steve Walsh, director of product and solutions, Duco 

This has been one of the most consequential years for financial market regulation in a decade. New compliance requirements have reshaped frameworks in Europe and across the globe. The two most important regulations were the Emir refit at the end of April and the US transition to a T+1 settlement cycle. Both regulations aim to enhance transparency and resilience. 

The Emir refit’s primary motivation was to improve data quality and transparency in the European derivative markets with mandatory data reconciliation requirements and obligations to report material issues to national competent authorities (NCAs). While the transition was largely successful, regulators next year will need to address lingering issues around data accuracy and integrity on data reported to trade repositories. 

Meanwhile in America, T+1 has created operational difficulties, highlighting data quality and transformation issues as well as poor processes and a lack of automation throughout. Resolving these issues will be relevant in Europe as well, as T+1 is expected to reach both the EU and the UK by the end of 2027. European firms need to start preparing while learning from their US peers.

Vikesh Patel, global head of clearing, and president, Cboe Clear Europe 

In 2025, we anticipate renewed regulatory efforts to promote more resilient, efficient and integrated pan-European financial infrastructures. Striking the right balance between fostering growth and innovation on one hand and maintaining regulatory oversight and financial stability on the other will be essential for advancing the region’s capital markets and we look forward to Emir 3.0 helping bring this to life. Whilst we anticipate that talk of top-down consolidation for Europe’s post-trade infrastructure is likely to persist, we will continue to advocate for strengthening the existing competitive framework, particularly in cash equities through mandating true clearing interoperability for all major exchanges.

We remain dedicated to fostering a stronger and more resilient European market by continually driving innovation and equipping participants with the tools they need to drive a more efficient use of their capital, ultimately contributing to long-term growth and stability across the region.

Matt Smith, chief executive officer, SteelEye  

Following several years marked by significant fines for record-keeping breaches related to encrypted messaging apps, we expect to see a broadening focus in 2025. E-comms will remain a regulatory focus, but so too will areas such as voice surveillance. 

Voice surveillance currently represents a big gap in many firms’ communications surveillance programmes due to ambiguous regulatory rules. However, it is likely regulators will clarify expectations around voice surveillance in 2025, and financial firms should prepare for this. 

Currently, regulatory rules do not specify how voice data should be monitored which has resulted in many financial institutions simply carrying out manual reviews of a sample of voice calls, leaving a considerable gap for missed risks.  With advancements in transcription and analytics technology, voice surveillance will move from being an overlooked channel to a critical component of risk management frameworks in 2025. 

Simon Gallagher, chief executive officer, Euronext London 

In 2025, the realities of increased competition from the US for capital and liquidity will be a wake-up call for Europe. On both sides of the channel, policy makers will accelerate measures to bridge the gap between the region’s vast, untapped household savings and its equity markets.

As part of this wider effort, Europe will need stronger and simpler market structures. Euronext will play its full role, making material contributions to simplifying Europe’s post-trade complexity, harmonising its fragmented ETF markets and leveraging our new clearing capability to unlock value for clients. In addition, following our recent push for a single, unified European prospectus, we will continue to proactively propose ‘bottom-up’ solutions to simplify European markets.

Under strong political leadership, I am optimistic that the region will be able to catch up with the US in funding innovation and infrastructure and in creating greater wealth for its citizens. 

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