FCA chief says 24/7 trading, AI agents and prediction markets are testing market integrity
Nikhil Rathi told the City's annual dinner at Mansion House that threats to market integrity are as serious as he has seen, and that the FCA will use its existing powers more assertively.
The chief executive of the UK Financial Conduct Authority, Nikhil Rathi, said on 22 October that rapid change in wholesale markets is putting market integrity under serious strain. He was speaking at the Corporation of the City of London’s annual City Dinner at Mansion House; the FCA published the text as drafted, noting that the delivered version may differ.
The risks he named
Rathi pointed to decentralised finance, 24/7 trading with prices increasingly forming over weekends, and parallel market structures operating alongside traditional ones. “The threats to market integrity are as serious as I have seen them,” he said, listing unprecedented volatility, concentration risks, new forms of market abuse and cross-border financial crime.
He gave insider trading on offshore gambling or prediction markets, and cloud outages such as one at Google Cloud that week, as examples of system-wide risks that start outside the firms the FCA authorises. He also said the FCA’s supervisors are using AI tools, freeing staff for hard judgements such as deciding when coordination between AI agents becomes market manipulation.
What the FCA says it will do
Rathi said the FCA would not slow its rule reforms, but that writing rules cannot be its only response. Instead it will rethink how it uses the powers it already has, asking what tools it can apply when significant harm affects markets within its remit, even if the source sits outside its perimeter. He mentioned the critical third-parties regime and an expanding anti-money laundering remit, under which the FCA is bringing more than 60,000 professional services businesses into its scope. He also said an FCA–Bank of England roadmap on digital assets is coming soon.
What it means for traders and firms
The speech announced no new rules or consultations. It does name the areas the regulator’s chief executive sees as the main risks: round-the-clock and weekend trading, prediction markets, AI-driven trading behaviour, operational resilience and cross-border financial crime.
Markets: Stocks · Crypto · Futures & Options · Forex
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