Google joins bid to transform UK bond markets
Leading firms, including Google, back a bid to run the UK’s real-time bond tape by 2026.
Several global players, including Google, Norway’s sovereign wealth fund, and UBS, have teamed up to support a bid to manage the UK’s upcoming real-time bond tape system. The bond tape is designed to consolidate market data, allowing investors greater transparency in bond transactions. This initiative is expected to enhance the UK’s capital markets and provide better visibility of the best deals.
The bond trading market, often fragmented, has seen limited price transparency due to its bilateral nature. A bond tape system, long used on Wall Street, could bridge this gap, helping market participants by offering a clear data feed. British regulators plan to begin the tendering process to select a company to operate this system by the end of 2024, with the expectation of it being fully functional by 2026.
Ediphy, a technology firm in London specialising in fixed income markets, has taken the lead in the effort. Collaborating with key partners like Cboe Global Markets, FactSet, and TP ICAP, Ediphy’s goal is to ensure the system is transparent and fair. Google Cloud could also play a crucial role by storing the system’s data.
While many in the financial sector back the bond tape initiative, exchanges remain hesitant, fearing the impact on their profitable data streams. Ediphy’s CEO, Chris Murphy, stressed that it’s essential to create a balanced and affordable system to avoid delays in its implementation.