A federal appeals court on Friday rejected Citadel Securities' bid to block IEX Group from opening an options exchange that deliberately slows orders.
The three-judge panel said the SEC properly approved the venue, undercutting Citadel's argument that latency arbitrage is not a genuine market problem.
That ruling clears the way for IEX to launch the new exchange later this year, extending its market structure model into options trading.
IEX, the exchange operator popularized by Michael Lewis's "Flash Boys," has long argued that intentional delays can blunt speed-based trading advantages.
With courts approving IEX's 'slow' exchange, could this victory for fairness unintentionally harm market liquidity and hurt investors?
Citadel is a member of IEX's stock exchange, so why did it legally challenge IEX's new options platform?
Will this landmark ruling against a high-speed trading giant fundamentally reshape how all US financial markets operate?