Opening remarks of Walt Lukken, President and CEO of FIA, at the International Derivatives Expo (IDX) in London on 16 June 2025. As prepared for delivery.
Welcome to the International Derivatives Expo, or IDX as we affectionately call it. It’s wonderful to see so many friends and colleagues.
The letter X contained in IDX is a perfect symbol for the crossroads that London represents. For generations, London is where the international community has come together to freely exchange goods, ideas and cultures.
IDX feels like a global family reunion among friends and colleagues. There are always hugs, laughter and double-cheeked kisses throughout the week. I’m glad to be a part of such a welcoming global community during such interesting times.
Yes, we gather in London feeling anxious about the world we are living in. How can you not? You can’t pick up a paper, turn on the news or look at your phone without being inundated with stories about the world falling apart.
Some of this is reality. There is more political unrest and conflict today than since the end of the cold war. There are many people feeling left behind by globalisation, and they are voting for more drastic policies and emboldened politicians.
Technology also plays a role in our uncertainty, as AI puts us on an exciting - but unknowable - path for humankind.
But some of this uncertainty is self-induced. Social media and 24/7 news feed us stories that enflame FOMO, jealousy, tribalism and the other deadly sins.
The truth is we are living in a modern world where technology improves yet complicates our lives. To quote Dickens, “It was the best of times, it was the worst of times.”
When I’m feeling anxious about the future, I recall the resilience and fortitude of our parents, grandparents and great grandparents and the challenges they faced—from world wars to depressions to famines. They took on these challenges at great personal sacrifice so our generation could live better lives.
I’d like to indulge you with the story of my great grandfather—Peder Johannes Ottaslökken—who later Americanised his name to Peter John Lukken when he emigrated from Norway to the United States in 1870.
Peter was born in a small village near Lillehammer Norway to struggling farmers who relied on the teenage Peter to help. One snowy November morning, Peter set out on skis with his cousin Austen to hunt grouse in the nearby mountains to earn extra money.
With three feet of snow on the ground, Peter and Austen came across large bear tracks that led them to a distant cave. With only ammunition for birds, they found shelter a mile away and melted what they had into larger bullets, using a smoking pipe to cast them. They had enough for one shot each…if the bullets worked at all.
The next morning, they returned to the cave and seeing just the eyes of the bear in the darkness, they fired their rifles without knowing whether they or the bear would survive the exchange.
The guns did fire, and Peter and Austen slayed the enormous bear and dragged it home over fourteen miles of snowy terrain. The boys netted $43 dollars, enough for a one-way ticket from Norway to America for Peter.
The 20-year-old Peter came to America by himself—an immigrant with nothing to his name—and eventually settled in the South Dakota prairie where he homesteaded for five years to gain ownership of the land. This became the Lukken farm where he and his wife, Anna, raised 8 children. Yes, I am the proud product of a hardworking and resilient immigrant.
Many of you have a similar story about relatives who have overcome great odds to impact the next generation for the better. So, when you feel anxious about our world, stop scrolling, remember our forebearers who sacrificed for us, and focus on those things that can make your life better.
That is great advice—not only for us personally—but for our industry as well. What decisions can we make today that will positively affect our industry down the road? I have three areas that I suggest we tackle as an industry.
Standardising our Trade Flow
The first is standardizing our infrastructure, which has been a primary focus of FIA over the last several years. The roads, highways and on-ramps of our markets need our attention and investment.
As many of you know, we have seen incredible volatility this year and record levels of trading volume.
But extreme volatility creates real problems for our customers and puts a tremendous amount of stress on our infrastructure.
Covid exposed this fragility as record volumes delayed allocated trades by days and sometimes weeks.
This led us to establish the Derivatives Market Institute for Standards – or DMIST for short. The first standard we tackled was this very issue of making sure trades got in the right account on trade day. The resulting 30-30-30 standard sets out tight timelines for market participants to allocate or accept trades within 30 minutes.
The adoption of this standard is beginning to bear fruit. The highest volume day in our industry occurred in April of this year, during President Trump’s announcement on raising tariffs. It exceeded the previous daily record set during the Ukraine invasion by more than 10 percent and surpassed the record set during the Covid shutdown in 2020 by one-third.
Even with this growth, misallocated trades dropped by nearly 50 percent compared to the Ukraine peak. And a vast majority of those delayed trades were resolved within a day or two—not the several days we experienced in 2020.
We are not declaring victory. We still have an unacceptable number of trades that get snagged during normal and peak times.
We will continue to leverage DMIST—with its improved metrics—to focus our industry on the adoption of the 30-30-30 standard. Vendors are also building technology solutions to this standard to improve give-up transparency and monitoring.
Looking ahead, DMIST has a strategic roadmap for the next twelve months aimed at other market inefficiencies that include average pricing, position transfers, self-match prevention and data templates.
Investing in our infrastructure will take time, but it is already paying off. And it will provide needed capacity for our industry to grow. This is a worthwhile focus for our industry.
Modernising our Collateral Movement
The second issue worth our attention is modernising our payment rails through the adoption of distributed ledger technology.
Last week, FIA released a white paper on tokenisation and its potential to accelerate the movement of collateral for margin requirements.
This technology could lead to huge improvements in collateral management and settlement. It will make it possible to move collateral and meet margin requirements on holidays and weekends when banking systems are closed. It also could play an important role in the transition to 24/7 trading.
To the sceptics, yes, I hear you. This idea has been around for many years. But I think we are at a turning point.
For example, CME, DTCC, Eurex and ICE are actively exploring tokenised-based solutions for margin and settlement.
Banks and asset management firms are also investing heavily in their own capacities to manage tokenized assets on blockchain networks.
The public sector is studying tokenisation for modernising the public payment rails, with the Bank of England, Federal Reserve and the Monetary Authority of Singapore all focused on this promising technology.
FIA plans to harness this potential through member education, like last week’s whitepaper, targeted webinars and forums like this. FIA is also analysing whether regulations need to be addressed to facilitate blockchain’s adoption. Lastly, we are seeking ways to collaborate with members on pilot projects and tabletop exercises that could advance this issue.
In short, stay tuned. We will have more to say about this in the coming months.
Simplifying our Regulations
The final topic we believe we can make a difference on is regulatory simplification.
Our industry is certainly not anti-regulation. Quite the opposite. Fit-for-purpose regulations bring fairness, clarity and predictability to our markets. Raising industry standards is part of FIA’s mission and smart regulation helps us to accomplish this.
At the same time, we welcome efforts by governments in the UK, EU and US to revisit and optimise the regulatory environment.
We are coming to the end of a regulatory super cycle that began with the Great Financial Crisis of 2008. Over the last 15 years, governments have placed layers and layers of regulation on financial firms, some certainly justified but some excessive and overly prescriptive.
The compliance costs of these regulations have a real impact on our economic growth and productivity.
One of FIA’s members, Nasdaq, estimates that regulatory rationalisation could produce between $25 and $50 billion in potential efficiency gains for banks. That would free up an additional $1 trillion in lending capacity globally.
The good news: there is an openness among the official sector to make regulatory systems more efficient and smarter.
Sir Keir Starmer and his Labour Party have pushed for growth that includes streamlining regulations.
The Draghi report and EU leaders have prioritised raising the economic productivity of the EU by simplifying their regulatory systems and cutting red tape.
And we have begun to see similar efforts in the US at the CFTC and SEC under the new Administration.
Importantly, we can accomplish this enhanced productivity by streamlining our regulations without adding risk to the system. FIA is actively working with its members to identify regulatory pain points and find ways to reduce the burdens without sacrificing the safety and soundness of our markets.
Conclusion
As I conclude, I recognise that we live in an uncertain world. But the opportunities before us are enormous.
FIA is here to help and bring meaningful transformation to our markets that future generations will benefit from.
Like Peter the Bear Hunter, our fore-bearers did not let the world just happen to them. They forged their future through determination and perseverance. I literally would not be here but for the courage of Peter.
The same goes for our industry. Risk takers and innovators have brought us this far. Now it’s our turn. We must be courageous. We must invest in the next generation of ideas, people and technology.
The future is in our hands. Let’s get to work
