Between 2024 and 2025, the US corporate bond market experienced rapid growth driven by the widespread adoption of portfolio trading, which accounted for a growing share of investment-grade and high-yield volumes. This shift was supported by technological innovations like automation and AI, and the expansion of credit ETFs that improved liquidity and market access. Leading platforms such as MarketAxess and Tradeweb saw significant increases in electronic trading volumes. While banks facilitated large trades, they faced margin pressure due to tighter bid-offer spreads, prompting heavy investments in technology. Non-bank financial intermediaries gained market share, and investors benefited from faster, more efficient execution, though liquidity became fragmented. These changes introduced new systemic and operational risks, leading to intensified regulatory scrutiny. Looking ahead, advances in AI, blockchain, and smart baskets promise to further transform market structure and accessibility.
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