The U.S. Securities and Exchange Commission on Friday proposed repealing the equity trade-through rule that has governed execution since 2005. The rule stops exchanges, alternative trading systems and wholesalers such as Citadel Securities and Virtu Financial from filling orders below the national best bid or offer. Removing it would allow trades at any displayed price, possibly widening spreads for retail investors.

Market participants argue the rule adds friction and raises transaction costs, especially for high‑frequency firms that route orders to achieve price improvement. Critics say eliminating the safeguard could erode confidence in best‑price execution and give wholesalers more leeway to capture spreads. The SEC’s staff paper notes that recent data show modest price improvement under the rule, but quantifying the impact remains contested.

Investors and broker‑dealers will watch the comment period closely, as any amendment could reshape order‑routing economics and affect execution quality metrics used by regulators. With the proposal open for public feedback until late July, the SEC faces pressure from both industry groups and consumer advocates. The rule’s fate will determine whether price‑improvement incentives stay intact or give way to broader pricing flexibility.