Two of the largest non-bank trading firms are making a major play for the currency options market. IMC Trading and Susquehanna International Group have begun expanding into FX options, backing the move with significant infrastructure investments.
Who's moving in
Both firms are well-known for their roles as market makers in equities and derivatives. IMC, based in Amsterdam, and Susquehanna, headquartered in Bala Cynwyd, Pennsylvania, have long operated in listed options and other asset classes. Now they're turning their attention to the over-the-counter currency options space, a market traditionally dominated by big banks.
The infrastructure bet
Neither company has disclosed exact spending figures, but the scale of the investments suggests a long-term commitment. Sources describe upgrades to trading technology, risk management systems, and connectivity with electronic trading platforms. The build-out is designed to handle the complexity of currency options, which involve multiple currencies, maturities, and strike prices.
Non-bank entrants like IMC and Susquehanna could change how currency options are priced and traded. Institutional investors — pension funds, asset managers, and hedge funds — are expected to benefit from tighter spreads and deeper liquidity. Market transparency may also improve as electronic trading gains share against opaque phone-based dealing.
The move comes as regulators in major jurisdictions push for more electronic trading in FX derivatives. Increased participation by non-bank firms aligns with those efforts, though it also raises questions about risk concentration and counterparty credit — issues that banks have long managed.
The expansion is still in its early stages. IMC and Susquehanna have not publicly detailed the full scope of their investments or a rollout schedule. But the direction is clear: currency options are the next frontier for non-bank market makers.
