FROM 24/5 TO 24/7

Preparing US Financial Market Infrastructure and Operations for Continuous Trading

A Compliance and Risk Briefing

August 2026

Executive Summary

US capital markets are moving from a 24/5 trading model towards continuous, 24/7 operation. The shift is being driven by retail investors accustomed to round-the-clock access in cryptocurrency markets, by international investors who together hold approximately $17 trillion of US equities and who operate in time zones where standard US market hours are inconvenient, and by competitive pressure among exchanges and brokers. Robinhood has introduced overnight trading on thousands of US stocks and exchange-traded funds, Blue Ocean Technologies has built an alternative trading system dedicated to out-of-hours trading, Nasdaq has announced plans for 24-hour weekday trading in the second half of 2026 subject to regulatory approval, and NYSE and Cboe are pursuing similar initiatives. CME Group is extending its cryptocurrency futures towards 24/7 trading, taking continuous trading into a market structure historically dependent on overnight processing windows.

Extending the hours during which an order can be matched is comparatively straightforward. The far harder problem sits beneath the trade: in clearing, settlement, collateral and margin management, risk monitoring, technology maintenance, compliance surveillance and staffing. Much of this infrastructure was built around the assumption of a defined trading session followed by an overnight window in which firms reconcile positions, refresh risk models, deploy software updates and investigate compliance alerts. Continuous trading removes that window.

A parallel development is unfolding on the regulatory side. The US Securities and Exchange Commission is preparing an "innovation exemption" that would, for the first time, allow tokenised securities to trade around the clock on blockchain networks, alongside the market-led extension of exchange hours described above. The exemption remains under active development rather than in force, but its direction of travel reinforces the same conclusion: firms need to prepare their infrastructure for continuous trading now, regardless of which route, market-led extended hours or a regulated tokenisation pathway, ultimately delivers it.

This briefing draws together four recent perspectives on the transition: from securities finance, from the post-trade and risk perspective on Wall Street's move to round-the-clock equities trading, from CME Group's experience extending 24/7 trading into futures markets, and from the regulatory pathway the SEC is building for tokenised equities through its proposed innovation exemption. It sets out the areas of financial institutions' infrastructure and operating models that will need to be strengthened, and the practical operational changes firms should plan for, including a case for agentic artificial intelligence as part of the solution.

1. The Direction of Travel

The move towards 24/7 trading in US markets is no longer theoretical. Exchanges, central clearing counterparties and central securities depositories have already gone live with 24/5 trading as a starting point, with continuous, nonstop trading positioned as a longer-term goal. Several developments illustrate the pace of change:

•    Retail brokers: Robinhood has introduced overnight trading on thousands of US stocks and exchange-traded funds.

•    Alternative trading systems: Blue Ocean Technologies has built an alternative trading system designed specifically to facilitate trading outside traditional market hours.

•    Exchanges: Nasdaq has announced plans to launch 24-hour weekday trading during the second half of 2026, subject to regulatory approval, while NYSE and Cboe are pursuing initiatives that would significantly expand trading hours.

•    Clearing infrastructure: DTCC has announced plans to support nearly twenty-four-hour equities clearing, operating from Sunday evening through Friday evening, in direct response to the industry's shift towards extended-hours trading.

•    Derivatives: CME Group is extending 24/7 trading into cryptocurrency futures, a market structure that, despite already trading on a roughly 23/6 model, still depends on clearing, collateral and margin processes historically reliant on overnight windows.

•    Regulatory pathway: the SEC is preparing an "innovation exemption" that would allow tokenised securities to trade continuously on blockchain networks, with Nasdaq and NYSE already approved to trade tokenised versions of major indices and DTCC piloting tokenised securities settlement from July 2026.

Underlying these initiatives are two demand drivers. First, cryptocurrency markets have accustomed a large population of retail investors to the expectation that financial assets should be available at any hour. Second, international investors, who according to Federal Reserve data own approximately $17 trillion of US equities, often operate in time zones where standard US market hours are inconvenient or inaccessible. Exchanges, brokers and trading venues see a clear commercial opportunity in meeting that demand.

Views on the merits of the shift are not unanimous. Proponents argue that markets should reflect the reality of a global economy that never sleeps, allowing investors to react immediately to earnings announcements, geopolitical events and macroeconomic developments. Detractors regard overnight and weekend trading as a solution in search of a problem, characterising it as the crypto tail wagging the capital markets dog. Whichever view prevails, the direction of travel across exchanges, brokers and market infrastructures points firmly towards extended and eventually continuous trading hours.

2. Why the Post-Trade Problem Matters More Than the Trade Itself

The public tends to think of trading as the central function of financial markets, but execution is only the beginning. Every completed transaction triggers a chain of downstream processes involving clearing firms, custodians, brokers, settlement systems, risk engines and reporting infrastructure. These systems determine how ownership changes hands, how capital requirements are calculated and how market participants manage their exposure. Much of this infrastructure evolved around the discipline of opening and closing bells: risk teams assess positions overnight, technology teams perform maintenance overnight, compliance departments investigate alerts overnight, and operational staff reconcile exceptions overnight.

Continuous trading forces the industry to reconsider each of these assumptions. If a major geopolitical event triggers sharp market moves at 2am, brokers must evaluate risk in real time, clearing firms must monitor exposure continuously, market makers must manage inventory throughout the night, and support teams may need to respond immediately rather than waiting for the next business day. Keeping a market open is relatively straightforward; managing risk continuously, every hour of every day, is considerably harder.

2.1 The lesson from T+1 settlement

A useful reference point is the industry's experience moving from T+2 to T+1 settlement in May 2024, a considerably smaller structural change than the move to continuous trading. That transition reduced the time available to settle transactions and lowered counterparty risk, and it was widely viewed as a success, but it also exposed how dependent market infrastructure remains on operational processes that occur after trading ends. DTCC surveys conducted during the transition found that many firms expected settlement failures to increase as operational timelines compressed, and the organisation reported that data quality issues already account for a significant proportion of settlement failures.

If reducing settlement by a single day required years of preparation across brokers, custodians, clearing firms and technology providers, the move towards nearly continuous trading raises a considerably larger question: what happens when markets operate almost continuously while many post-trade processes remain designed around defined trading sessions? DTCC's own response, extending equities clearing to run nearly twenty-four hours a day from Sunday evening through Friday evening, is a direct acknowledgement that existing infrastructure cannot simply absorb the change without redesign.

2.2 Liquidity fragmentation

Extending market hours does not automatically extend market quality. BlackRock has identified liquidity fragmentation as one of the most significant risks of continuous trading. During regular market hours, investors benefit from deep pools of liquidity, active market makers and extensive participation from institutional investors. Overnight sessions look very different: trading volumes are lower, participation is narrower and market makers face greater uncertainty, typically resulting in wider spreads and weaker price discovery.

A market may technically remain open at 3am, but the quality of that market can differ substantially from the primary session. Large-cap stocks are likely to continue attracting sufficient liquidity, while smaller companies could face significantly wider spreads and increased volatility. This is particularly consequential during periods of market stress, when geopolitical events, earnings surprises or unexpected economic developments occurring overnight may trigger substantial price movements before liquidity providers have sufficient confidence to tighten spreads. The ability to trade continuously does not, in itself, guarantee the ability to trade efficiently.

2.3 The Knight Capital warning

History offers a stark illustration of what can go wrong when technology fails under pressure. In August 2012, Knight Capital deployed malfunctioning software shortly after markets opened, and within approximately forty-five minutes accumulated losses of roughly $440 million through a flood of unintended orders. The incident nearly destroyed one of the largest market-making firms in the United States and remains one of the most expensive technology failures in financial market history. Following the event, the SEC stated that firms should evaluate whether sufficient safeguards exist to prevent technological malfunctions from threatening market integrity.

A continuous market increases the importance of those safeguards considerably. If markets operate nearly twenty-four hours a day, firms lose many of the maintenance windows and operational buffers that traditionally allowed technology teams to test updates, identify issues and perform repairs before the next session opened. Under a 24/7 model, either systems become materially more resilient, or the consequences of the next technology failure become correspondingly more severe.

3. What CME's Experience Adds: Futures and Continuous Clearing

CME Group's move towards 24/7 trading in cryptocurrency futures illustrates that bringing continuous trading to traditional exchange-traded markets is a materially different challenge from continuous trading in spot crypto or tokenised assets. Digital asset markets have already shown that continuous uptime is operationally achievable when infrastructure is designed around real-time trading and settlement from the outset. Futures markets carry an additional layer of complexity beyond simply matching buyers and sellers continuously: infrastructure depends heavily on clearing workflows, collateral management and margin processing, all of which have historically relied on overnight operational windows, even in a market that already trades on a roughly 23/6 model.

Continuous markets require continuous oversight. Risk exposure, margin calculations and collateral management need to happen in real time rather than through delayed or batch-based processes. That creates significant pressure on firms running legacy infrastructure originally designed around fixed market sessions, many of which still assume there will always be a maintenance window or operational reset point. Once that assumption is removed, trading systems need to be engineered differently, with rolling upgrades and continuous monitoring replacing scheduled maintenance windows as a core operational requirement rather than a technical advantage.

This is one reason equities exchanges pushing for 24/7 trading, Nasdaq among them, are turning to tokenisation to create versions of equities that can be traded more seamlessly around the clock, borrowing the operational model that digital asset markets have already proven out. CME's experience is likely to be a bellwether for other traditional exchange-traded markets considering the same move: firms already accustomed to extended trading hours may still find the leap to genuine 24/7 trading in futures more substantial than expected, given the interconnected nature of clearing and liquidity in that market structure.

4. Securities Finance and the Regulatory Pathway to Tokenisation

4.1 Securities Finance and the Competitive Threat from DLT

Securities finance faces a distinct version of this challenge. Client demand for 24/7 trading will inevitably extend to demand for securities lending and financing that can support it, and it is not yet obvious how securities finance will adapt. The move will involve widespread changes to market functioning, operations and technology, requiring co-ordination across the ecosystem of market participants and market infrastructures. If securities finance firms do not prepare, they risk losing business to distributed ledger technology platforms offering tokenised lending as an alternative.

Adding headcount is an unlikely solution on its own. The added revenue from out-of-hours activity may not cover the cost of round-the-clock staffing, and there is limited appetite among traders, operations staff and risk managers to work every weekend. This cost and staffing constraint is a large part of the argument for automation, and specifically for agentic artificial intelligence, as a practical route to supporting overnight and weekend trading without a proportionate increase in headcount. Agentic AI is improving quickly and financial firms are already deploying it to automate workflows across a range of use cases, but its adoption carries its own risks around cost, governance and regulation, and firms will need to determine how much autonomy is appropriate for which processes.

4.2 The SEC's Innovation Exemption: A New Regulatory Pathway

A separate but converging development is unfolding on the regulatory side. The US Securities and Exchange Commission is preparing an "innovation exemption" that would allow tokenised securities to trade on blockchain networks around the clock, rather than being confined to the hours of conventional US exchanges. The initiative sits at the centre of Chairman Paul Atkins' Project Crypto agenda and represents the most consequential attempt yet to bring the fast-growing offshore market in tokenised equities inside the US regulatory perimeter. SEC Commissioner Hester Peirce indicated in March 2026 that agency staff were developing an exemption to facilitate limited trading of certain tokenised securities, while flagging a series of unresolved questions, including how atomic settlement should work, what intermediary obligations should apply, how investors would be protected outside normal market hours, and whether third parties ought to require an issuer's consent before wrapping its shares in tokenised form. Earlier in 2026 the Commission had already granted exemptive relief permitting 24/7 trading and instant settlement for tokenised shares of a money market fund, establishing that round-the-clock securities trading is not, in itself, incompatible with its rulebook.

The exemption is emerging as traditional exchanges and crypto native platforms race to build competing, and in places overlapping, tokenisation infrastructure. Nasdaq secured SEC approval in March 2026 to trade tokenised versions of Russell 1000 constituents and major index ETFs, and NYSE followed with its own approval the following month. DTCC, which custodies roughly $114 trillion in assets, has moved in parallel, announcing a limited production pilot for tokenised securities from July 2026 involving more than fifty institutions, including BlackRock, JPMorgan and Goldman Sachs, with a broader rollout planned for October. What is taking shape is, in effect, not one onshore market for tokenised equities but two: the Nasdaq and DTCC rail preserves full shareholder rights and clears through existing post-trade infrastructure, with tokenisation acting as a wrapper around a conventional, already settled position, while the innovation exemption would open a second, lighter-touch rail on which crypto native platforms could list tokenised exposure to public companies, in some cases without the issuer's consent and without the full set of shareholder rights, including voting and dividends, that attach to the underlying stock.

4.3 Market Structure Concerns and the Rollout Delay

The exemption has not, in fact, arrived on the timetable the market expected. A draft was reportedly prepared and reviewed by SEC staff in mid-May 2026, with publication expected within days, before the Commission pulled the planned rollout after Nasdaq, NYSE and Cboe leadership raised market structure and surveillance concerns directly with the agency. Chief among them was a price discovery problem: listed equities trade roughly between 9.30am and 4.00pm Eastern Time, with regulated pre-market and after-hours sessions either side, whereas tokenised equities on a blockchain would clear continuously, leaving no reference price on the listed market for as much as sixteen hours a day against which an off-hours tokenised trade could be checked, and no National Best Bid and Offer to anchor retail orders executed overnight. As at the time of writing, the exemption remains under active development rather than in force. The policy direction is settled; the operational detail, particularly around price discovery, surveillance and investor protection outside exchange hours, is still being negotiated between the Commission and the incumbent exchanges. Firms preparing for 24/7 trading should treat the current pause as a planning window rather than a reason to stand down.

4.4 What the Innovation Exemption Means for Firms

Whatever final form the innovation exemption takes, the direction of travel is difficult to dispute, and it reinforces rather than duplicates the operational changes set out in Section 6. Firms that intend to participate in tokenised equity markets, whether as issuers, broker-dealers, custodians, exchanges or crypto native platforms, will need surveillance systems capable of constructing a fair reference price during hours when no primary listed market is trading; custody, settlement and reconciliation processes that resolve how a token reconciles against the underlying security held at a custodian such as DTC, including how corporate actions are reflected in or excluded from the token; market making and liquidity arrangements that function credibly outside primary hours; KYC, AML, suitability and disclosure processes that operate around the clock, since the Commission's joint divisional guidance issued in January 2026 made clear that bringing 24/7 trading onshore does not relax the underlying securities laws; resilient, highly available trading and settlement infrastructure with minimal scheduled downtime; and governance structures able to adapt quickly as the exemption's final conditions, including exposure limits, eligible instruments and any sandbox period, are settled. The firms best placed to benefit will be those that use the current pause to build this capability now, rather than waiting for the rule to be finalised before they begin.

5. Areas That Need to Be Strengthened

Drawing the four perspectives together, six areas of financial market infrastructure stand out as needing material strengthening before continuous trading can be supported safely and reliably.

6. Operational Changes Financial Institutions Will Need to Make

The areas identified above translate into a concrete set of operational changes for financial institutions preparing for extended or continuous trading hours.

6.1 Trading and market operations

1.   Move from end-of-day and overnight batch reconciliation towards real-time or near-real-time trade reconciliation, so exceptions are identified and resolved continuously rather than accumulating for a single overnight window.

2.   Reassess market-making and liquidity provision arrangements for out-of-hours sessions, given the evidence that overnight liquidity is materially thinner and spreads materially wider than during primary trading hours.

3.   Review order handling, best execution and surveillance arrangements to ensure they perform consistently across time zones and thinner-liquidity periods, not only during the primary session.

4.   Develop robust methodologies for constructing a fair reference price during hours when no primary listed market is trading, for any tokenised instruments the firm supports, with clear, disclosed rules for how that price feeds into execution and best execution assessments.

6.2 Clearing, settlement and collateral

5.   Align internal settlement and collateral processes with DTCC's move towards nearly twenty-four-hour equities clearing, and confirm operational readiness for settlement processing that no longer pauses overnight.

6.   Strengthen data quality controls at the point of trade capture, since data quality issues were already identified as a significant contributor to settlement failures under the far smaller T+1 change.

7.   Move collateral and margin management from batch-based to real-time calculation, particularly for futures and other cleared products where clearing workflows have historically depended on overnight windows.

8.   Resolve, for any tokenised instruments the firm supports, how a token representing economic exposure to a share reconciles against the underlying security held at a custodian, and how corporate actions, including dividends, stock splits and voting, are reflected in or excluded from the token.

6.3 Risk management

9.   Establish continuous risk monitoring capability so that exposure, margin and concentration risk are assessed in real time rather than refreshed once per session.

10.        Build playbooks for risk response during low-liquidity, high-volatility overnight periods, when spreads widen and price discovery weakens most, including pre-agreed escalation paths and circuit-breaker equivalents for out-of-hours conditions.

11.        Revisit stress-testing and scenario analysis to explicitly capture overnight and weekend market conditions, rather than relying solely on primary-session assumptions.

6.4 Technology and infrastructure

12.        Redesign change management around rolling upgrades and continuous monitoring, removing dependence on a fixed maintenance window for software deployment and system testing.

13.        Invest in resilience and failover capability commensurate with the loss of the overnight buffer, treating the prevention of a Knight Capital-style technology failure as a standing operational priority rather than a one-off remediation exercise.

14.        Evaluate the case for tokenised infrastructure where appropriate, following the approach taken by equities exchanges pursuing 24/7 trading, given that tokenised and digital asset markets have already demonstrated that continuous uptime is achievable when systems are designed around it from the outset.

6.5 Compliance and governance

15.        Extend compliance monitoring and alert investigation to operate continuously, rather than relying on overnight and next-business-day review, so that alerts generated outside primary hours receive timely attention.

16.        Establish governance frameworks for any use of agentic AI in trading, operations or risk workflows before deployment, covering permitted use cases, human oversight, escalation and audit trail requirements, given the acknowledged risks around cost, governance and regulation.

17.        Review regulatory reporting and record-keeping obligations to confirm they can be met on a continuous basis, including for activity that occurs outside what has historically been treated as the reporting day.

18.        Extend KYC, AML, suitability and disclosure processes, including complaints handling, to operate around the clock rather than during a conventional compliance shift, with clear client-facing disclosure of what any tokenised instrument does and does not confer, particularly voting rights and dividends.

6.6 Staffing and organisational design

19.        Move towards globally distributed, follow-the-sun coverage for trading support, engineering and risk functions, so incidents can be addressed immediately regardless of the time zone in which they occur.

20.        Treat automation, including agentic AI, as a means of extending coverage without a proportionate increase in headcount, recognising that added revenue from out-of-hours trading may not fully cover the cost of round-the-clock staffing and that appetite for weekend and overnight working is limited.

21.        Reassess resourcing models and shift patterns for operations, risk and compliance staff, with clear escalation ownership at every hour of the trading week rather than only during the traditional trading day.

7. The Case for Agentic AI

Across all four perspectives, automation and agentic AI specifically emerge as a central part of the practical response to continuous trading. The economics are straightforward: extending operations to cover overnight and weekend activity through additional headcount alone is unlikely to be commercially viable, since the incremental revenue from out-of-hours trading may not cover the cost of round-the-clock staffing, and there is limited appetite among trading, operations and risk staff to work every weekend.

Agentic AI tools are improving quickly and financial firms are already deploying them to automate workflows across a range of use cases relevant to continuous trading, including trade reconciliation, exception handling, risk monitoring and first-line compliance surveillance. However, the use of autonomous agents in these functions carries genuine risks, including rising costs, unresolved governance questions, regulatory uncertainty, and the more basic question of how much automation is appropriate for a given process. Firms should treat the adoption of agentic AI as a governed, staged process rather than a wholesale replacement for human oversight, prioritising well-defined, lower-risk workflows first and building the audit, escalation and human-review controls needed before extending automation into higher-risk trading, risk and compliance decisions.

8. Recommended Next Steps

22.        Commission a gap analysis of clearing, settlement, margin, risk monitoring, technology change management and compliance surveillance capability against a continuous trading operating model, using the six areas set out in Section 5 as the framework.

23.        Engage directly with DTCC, relevant exchanges and clearing counterparties to understand the specific timetable and requirements for near-continuous clearing and settlement as they apply to the firm's products and client base.

24.        Establish a cross-functional working group spanning trading, operations, technology, risk and compliance to own the transition, given that the changes required cut across every one of those functions simultaneously.

25.        Develop and test a governance framework for agentic AI before any deployment into trading, risk or compliance workflows, covering permitted use cases, oversight, escalation and audit requirements.

26.        Review staffing and shift models against a follow-the-sun coverage requirement, and quantify the likely cost of continuous coverage against the anticipated revenue benefit of extended trading hours.

27.        Build overnight and weekend stress scenarios into existing risk and technology resilience testing, using the Knight Capital incident and the liquidity fragmentation risks identified by BlackRock as reference points.

28.        Monitor the SEC's innovation exemption as it moves through consultation, and participate in the process where relevant, since exchange and market participant feedback has already reshaped the timetable once and is likely to continue shaping the final conditions.

Sources

This briefing draws on four source articles: a research report on securities finance, 24/7 trading and the case for agentic AI; an analysis of the post-trade, liquidity and risk challenges behind Wall Street's move to round-the-clock trading, referencing Federal Reserve, DTCC, BlackRock and SEC material; a review of the operational and technological challenges raised by CME Group's move towards 24/7 cryptocurrency futures trading; and an examination of the SEC's proposed innovation exemption for tokenised equities and its implications for market structure, surveillance and firm readiness.

DISCLAIMER

Nothing in this report constitutes legal advice, financial advice, investment advice, or a recommendation to adopt, implement, or refrain from any particular course of action. Readers should not rely on this report as a substitute for independent legal, regulatory, tax, financial, or technical advice tailored to their specific circumstances and jurisdiction. The Digital Commonwealth (DCW) accepts no liability for any loss, damage, or consequence arising directly or indirectly from reliance on the contents of this report.

The regulatory landscape for stablecoins and digital assets is evolving rapidly across all jurisdictions referenced herein. Whilst reasonable care has been taken to reflect the state of regulation, legislation, and market practice as at May 2026, this report does not purport to be a comprehensive or definitive statement of the law or regulatory position in any jurisdiction. It may not reflect developments occurring after the date of publication. Readers operating in regulated activities should conduct their own legal and compliance review and seek appropriate professional advice.

References to specific legislation, regulatory proposals, market data, and third-party products or services are included for illustrative and contextual purposes only. The inclusion of any such reference does not constitute endorsement, recommendation, or verification of accuracy. Market data and transaction volume figures are drawn from publicly available sources and are subject to revision.

This report is provided on a confidential basis and is intended solely for the use of the recipient(s) to whom it is addressed. It may not be reproduced, distributed, or disclosed to any third party.

Eric Williamson, Director of Compliance and Risk

© 2026 The Digital Commonwealth Limited. All rights reserved