The coming revolution in how derivatives are traded and cleared is spawning contenders to NYSE Euronext-owned Liffe and Deutsche Börse’s Eurex, which have dominated the European markets in interest rate futures for years.

New entrants are marshalling their forces as a result of the Dodd-Frank Act in the US and the European Market Infrastructure Regulation, which will require many OTC derivatives to be traded and cleared on electronic trading platforms. Swaps will have to be centrally cleared for the first time, raising costs associated with the need to post collateral against exposures and hold funds at clearing houses to mitigate risk.