Hedge funds could look to bypass UST clearing mandate
New paper argues that repo users might relocate offshore or use other means to avoid US Treasury clearing dragnet
Hedge funds and other market participants could funnel US Treasury trades offshore to avoid the Treasury clearing mandate, an academic paper has suggested.
The paper by Yesha Yadav and Joshua Younger, lays out the benefits and potential pitfalls of the US Treasury securities clearing rule, which will require in-scope entities to clear cash Treasury trades from the end of this year and repo trades six months later.
A “key concern” raised by Yadav and Younger is “the potential for evasion”, given
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