This piece was originally published in The TRADE News.

By Sam Railton, Managing Director, Business Management, EMEA, Tower Research Capital

First and foremost, we need a consolidated tape – but not just for the sake of it. The tape should surface addressable liquidity, which is not always the same as price-forming liquidity. Consider VWAP trades: the contra-side is fully addressable from a participant’s point of view, but the trade reports come through at a “benchmark price” so ignoring all non-price-forming trades is also partially misleading.

Second, the industry would benefit from clearer definitions and more consistent reporting standards. Let’s explicitly flag addressable liquidity. Let’s avoid reporting off-book, on-exchange

trades that serve no economic function beyond a post-trade settlement process. Let’s align on what market activity deserves to be counted as part of the liquidity conversation – and what doesn’t.

Finally, we need a regulatory mindset shift. Rather than imposing increasingly granular rules, regulators should adopt a principles-based framework focused on economic substance. That means ensuring internalised flows – especially those linked to derivatives like swaps – are reflected in equity reporting when they represent genuine liquidity. This isn’t about overreach. It’s about recognising activity that’s already shaping the market but isn’t yet being measured.

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