The idea of forcing credit default swaps onto a clearinghouse has been relatively uncontroversial, and we've covered the rise of several clearinghouses aiming for market share. The ICE, backed by the big dealers, seems to have the early, upper hand. But there's a movement in Congress underway that would push CDS trading onto an actual exchange, and that has Wall Street fired up.

CDS and other derivative trading is enormously profitable. And when Wall Street firms hear of exchange-based trading, they think about what happened to their trading profits in equities. Spreads decline, commissions fall, regulatory oversight increases, data is made extremely public and it gets a lot harder to make a buck. So we're about to see a huge battle unfold. The New York Times makes it clear that Wall Street is not going to take this lying down. It has ramped up its lobbying efforts and seems bent on preserving its margins. 

For more:
- here's the article

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