Questioning the “Obvious”: How MIC Transformed My Perspective on Market Regulation

A World in Transition

Capital markets worldwide are undergoing a profound transformation. Stablecoins are reshaping payment infrastructure. NYSE and Nasdaq are expanding towards near-24-hour trading. Non-traditional derivatives platforms like Kalshi and Polymarket are challenging conventional boundaries. Security token offerings through platforms like Kraken are emerging as new frontiers. The rules and assumptions that have governed our markets for decades are being questioned, reimagined, and rewritten.

When I enrolled in the Market Infrastructure Certificate (MIC) programme, a collaboration between the World Federation of Exchanges and Bayes Business School, I did not fully anticipate how timely and transformative this experience would be. The programme’s four modules (Payment/Market Infrastructure, Market Microstructure, ESG, and the Industry Project) arrived precisely when I needed them most: at a moment when both global markets and my home market in Korea are facing unprecedented change.

Korea’s Capital Market at a Crossroads

For seventy years, Korea Exchange (KRX) has operated as the sole exchange in Korea. That era ended in March 2025, when Nextrade, an Alternative Trading System, commenced operations, introducing multi-venue trading to Korea for the first time. Within less than a year, this new entrant has already begun challenging KRX’s market share in ways few anticipated.

Simultaneously, discussions about extending trading hours are gaining momentum. KRX currently maintains an unusually extensive list of enumerated grounds for trading halts, far more than most international peers. Should trading hours be extended, the burden on KRX’s market operations would grow exponentially.

These developments have forced a fundamental reckoning. After seven decades of monopoly, KRX must now re-examine everything it once took for granted. Practices that seemed “obvious” because they were codified in regulations must now be scrutinised through fresh eyes. Every foundation must be tested anew.

Chicago Industry Week: Rediscovering the Fundamentals

The academic coursework offered rigorous theoretical grounding, but it was the Industry Week in Chicago that made me confront my own assumptions.

Standing on the Cboe trading floor and hearing the open outcry was unexpectedly profound. In the age of electronic trading, the dynamics of bids, asks, and executions have become abstract, something that simply happens inside a matching engine. Watching traders shout and signal brought those mechanics back to their human essence: real-time price discovery through interaction, negotiation, and judgment. It reminded me that beneath every algorithm lies a fundamental process that deserves to be understood, not merely taken for granted.

Throughout the week, I attended sessions with NYSE, Nasdaq, Cboe, CME, algorithmic trading firms, and asset managers. What struck me most was realising that these institutions, leaders in their fields, are also questioning assumptions they once held as obvious. Extended trading hours, market structure, regulatory frameworks: everyone is re-examining the foundations. It was reassuring and motivating to see that this process of questioning is not unique to Korea, but a shared challenge across global markets.

From Disclosure Data to Order Books: A Personal Transformation

For most of my career at KRX, I have worked in the Disclosure Department. I have handled countless disclosure and listing datasets. But I had never once analysed high-frequency order book data. The world of market microstructure (bid-ask spreads, price impact, and liquidity dynamics) remained foreign territory.

The Market Microstructure module changed that fundamentally. For the first time, I learned to think about markets not just from the perspective of information disclosure, but from the perspective of how that information is absorbed, processed, and reflected in trading behaviour. I learned to read the language of order books: quoted spreads, effective spreads, and realised spreads, each telling different stories about market quality and information asymmetry.

Questioning the Obvious: My Industry Project

This new skill became central to my Industry Project. I chose to examine one of those “obvious” regulations: KRX’s uniform trading halt rule for bonus issue disclosures.

Under current rules, when a KOSDAQ-listed company announces a bonus issue exceeding 20%, trading is halted for exactly 30 minutes, regardless of magnitude. A 25% bonus issue triggers the same halt as a 200% bonus issue. Having worked in the Disclosure Department, I had always accepted this as simply “the rule”. But the MIC programme taught me to ask: does this make sense from a market microstructure perspective?

Using tick-level order book data from 410 KOSDAQ bonus issue events between 2010 and 2025, I found two key results.

First, higher bonus ratios do not require longer trading halts. In fact, bonus issues below 100% took longer for effective spreads to normalise. This is because smaller ratios create interpretive ambiguity: should they be treated as stock dividends or stock splits? This uncertainty about valuation adjustments prolongs price discovery. In contrast, Korean bonus issues concentrate heavily at round numbers (100% and 200% alone account for two-thirds of the sample), which function unambiguously as stock splits with mechanical price adjustments. This finding aligns with prior US GAAP research on mid-range stock distributions.

Second, beyond event magnitude, pre-existing stock liquidity characteristics also explained meaningful variation in post-halt market quality. High-liquidity stocks normalised quickly regardless of bonus size, while medium-liquidity stocks faced persistent challenges. This is consistent with the established literature linking liquidity to market efficiency.

Looking Forward

These findings suggest that the current framework’s exclusive focus on event magnitude may be incomplete. But beyond any specific policy recommendation, the MIC programme taught me something more fundamental: the confidence to question long-held assumptions with rigorous empirical analysis.

The MIC programme has equipped me with both the analytical tools and the critical mindset to contribute meaningfully to discussions about Korea’s market structure evolution. I return to KRX with practical experience in market microstructure analysis, a global perspective gained from exchanges worldwide, and, perhaps most importantly, the willingness to question what once seemed unquestionable.

As Korea’s capital markets enter this new era of competition and change, I am grateful to have had this opportunity to prepare. The friendships formed with fellow participants from exchanges around the world, the insights gained from world-class faculty, and the hands-on experience from the Industry Project have all contributed to a genuine expansion of my professional horizons.

To colleagues considering the MIC programme: if you are ready to challenge your assumptions and expand your understanding of market infrastructure, I cannot recommend it highly enough.