The market is gearing up for a very strong IPO window. I regard the volatility we saw in the third quarter of 2023 as healthy and a regular component of equities trading. As an exchange, we cannot control geopolitical uncertainties and the effects they have on overall market sentiment. After investors drew confidence from strong IPOs by consumer-facing brands in the second quarter, these uncertainties influenced stock performance around some of our debuts in the fall. This was evident in the Birkenstock IPO, our most significant new listing in the fourth quarter. However, the stock price recovered quickly and is now trading above its IPO price.

I do not think we will see a long-term impact. The stock returned to trading above its IPO price within a month – and many companies will continue to tap the US public markets because of the depth of liquidity and access to a large number of institutional investors. In fact, more and more foreign companies are thinking about either moving their listings to the US or having an IPO here. In November, we were excited that Flutter, the leading global sports betting and gaming provider, announced it will list its shares on the New York Stock Exchange in early 2024.

That is hard to pinpoint. We had expected a variety of companies to go public in the fourth quarter of 2023 and almost all of them have now pushed their IPO back to the first quarter of 2024. Hence, we have an incredibly valuable backlog that we need to work through. Based on the conversations we have had with management teams and the amount of time and resources they invest to prepare their listings, we expect IPO activity to pick up strongly in the new calendar year.

Strong listings by foreign companies further differentiate us from our competitors. The New York Stock Exchange is a notable brand and companies attempting to tap the US public market tend to rely on us. Market participants know that we are reliable and our systems are resilient. At NYSE, they find a platform that allows them to become highly visible to global investors. This applies to all foreign companies – and Germany is a market that we focus on keenly. Including Birkenstock, we are home to seven German companies that collectively possess a market cap of more than 200 billion dollars. We would be happy to welcome more.

We provide access the broadest pool of investors possible. Many companies take note of this and seek to adopt a dual-listing structure. This allows them to be present in their home market and at the same time tap the deep and liquid US market through an American Depositary Receipt or a dual primary listing. However, since the American market provides more liquidity, valuations for dual-listed companies tend to diverge. Thus, companies are increasingly flipping their primary listings to the US.

I’m optimistic that we will find a balance going forward. At the end of last year, the Public Company Accounting Oversight Board started to inspect audits at Chinese firms. The increased transparency resulting from these inspections is an important precondition for a continued presence of Chinese companies in the US public markets. More recently, a process through which firms that attempt a US listing can meet Chinese regulatory standards has come into focus. I strongly believe that Chinese companies with global customers and a large investor base in the US will be able to continue their presence in the American market or be able to list their shares here.

The next year will be incredibly interesting. We are gearing up for the Presidential election in the US, which will definitely influence the geopolitical landscape. As we saw this year, however, the effects of geopolitical tensions on the listing environment are hard to predict. We hope for a constructive debate within the US and with the European Union – but NYSE will continue in its role as a hub for global investors and companies regardless. We have great relationships in different economies and are building bridges between businesses. This could express itself through common standards for listings, products such as indices or ETFs, or collaborations on ESG data.

ESG, like all investment trends, is data-driven. Our job as an exchange is to provide tools to issuers that enable them to manage sustainability risks and market their ESG stories. This holds true for both American and foreign companies, regardless of the current political environment. The market then makes its own decisions about each investment case, as has become evident in ESG fund flows. Having said that, the sustainable transition has always been near and dear to our hearts.

ICE started out as a group of energy exchanges with the goal of adding transparency to the power market. We acquired a business called the Climate Exchange in 2010. That acquisition led to the availability of carbon allowance futures and credit on our platforms. Additionally, our data business provides insights that allow companies to manage environmental and climate-change risk in a variety of markets.

We manage ICE in an extraordinarily collaborative fashion.. Clearly, I devote large shares of my time to the New York Stock Exchange, but I also act as the Chair of ICE Fixed Income and Data Services. Large risk-management challenges addressed through multiple lenses play an important role in our strategic planning. We focus on deploying resilient, state-of-the-art technology to meet clients' evolving risk-management needs.

We are among the very few large exchanges worldwide that still have physical trading on their floors. That is an underappreciated factor. As the world becomes more technologically driven, the most tech-forward businesses employ humans to oversee that technology. We can prices half a trillion electronic messages per day on the New York Stock Exchange platform. Without the humans downstairs on our trading floor, volatility would significantly increase, particularly at the opening and close of trading. This human touch is important to issuers, especially when they are executing stock buybacks or share issuances that can have a meaningful impact on prices.

Exchanges like ours can use that technology productively to allow humans to perform higher value tasks. For example, we have increased efficiency by harnessing the large amounts of data that flow into NYSE. Additionally, we have brought more transparency to the energy market through large language models on our ICE Chat platform. It connects participants in our markets through messaging systems and is equipped with proprietary text recognition. Thorugh this feature, ICE Chat can turn messages into actionable data, resulting in added efficiency.

We have worked on the platform for more than ten years, and broader usage picked up at the end of 2021. The volumes on our energy markets that emanate from this platform are up 70% year-to-date. Market participants are learning to use AI-embedded technologies as an efficiency play. These are early days, so the volumes are small in comparison to overall trades on our energy markets, but they are rapidly growing.

I can only speak about us – and we focus on making sure that companies that list publicly on NYSE adhere to our high listing standards. Not every company that applies to tap the US market will qualify for a listing with us. In fact, about 70% of IPOs didn't qualify for NYSE in 2023. We have been at the core of developing the US capital markets for 231 years and have a very different responsibility.

Spacs will always have their place in the market. They have been a viable way for companies to go public since emerging more than 20 years ago. However, the challenge in 2020 and 2021 was that hundreds of Spacs came to market at around the same time.

We have been a pioneer in direct listings, innovating with Spotify's first-ever direct listing in 2018. Since then, we have been able to welcome a variety of other companies like prescription glasses retailer Warby Parker, technology innovator Palantir and online gaming platform Roblox through that same mechanism. After regulatory changes last year, we now also have the ability for someone to have a direct listing with a capital raise, as opposed to the traditional direct listing without acapital raise. I do expect activity in this segment to pick up again.

I want to make clear that we are not against the reform per se. However, the SEC has suggested a plethora of large changes all at once. The agency wants to introduce an auction system for individual orders while harmonizing tick sizes between exchanges and wholesalers who are able to trade at sub-penny increments. It also aims to introduce a new regulatory framework for the best execution of orders by brokers and increase transparency for investors by modifying the disclosure rules around order execution.

We got together with Citadel and Charles Schwab, the largest market maker and the largest retail order flow provider, to argue for a more gradual process of reform. The SEC should enact the proposed rules based on industry comments and give itself time to recognize any unintended consequences each individual implementation might have. Having said that, we do see clear benefits to the public market from a portion of these rules.

Tick size harmonization immediately comes to mind. The reason why dark pools have gained such a large share of order execution is that they are able to trade at sub-penny increments. If large exchanges like NYSE can decrease their tick sizes, we could compete with the dark pools' prices in trades where the bid-offer spread is very tight.

We can’t yet quantify that. What we can say is this: If the SEC applies tick harmonization as recommended by NYSE, price improvement in the market could increase by an estimated 3.8 million dollars per day. This would be in addition to the existing 49.8 million dollars in estimated daily price improvement compared to the quoted market price.

We entered that market very early. We took the stake in Coinbase in 2014 and sold it in 2021 after platform's entry into the public markets. In 2018, we also launched an entity called bakkt that developed a trading platform and infrastructure for cryptocurrency trading. Bakkt was, in fact, the first institutional crypto platform. It has been interesting to see how crypto has evolved since. We have always said that the sector needs clear regulatory guidelines before institutional investors would get involved on a larger scale. As long as these guidelines are still only in development, we are continuing to innovate but are not bringing new products to market.

Like us, institutional investors are waiting for more regulatority clarity. However, a dialogue has emerged around the ETF markets. We will just have to wait and see whether Spot Bitcoin ETFs will eventually receive the SEC’s green light. We have been working for years with a variety of issuers to bring a spot Bitcoin ETF to market on NYSE Arca – and we would be ready if the appropriate regulation were in place.