There is increasing concern that the US options market faces systemic risk despite a sixth straight record year in terms of volume, with the bulk of clearing activity remaining concentrated among a handful of major banks, according to a report by Bloomberg.
All trades go through the Options Clearing Corp (OCC), where the top five members — including Bank of America, Goldman Sachs and ABN Amro — provided almost half of the default fund in Q2 2025. With most market-maker flow routed through these firms, the market faces elevated vulnerability should one large clearer encounter stress or reach capacity limits.
Record derivatives growth is amplifying the issue. OCC average daily volumes jumped 52% in October compared to last year, pushing some market makers toward self-clearing despite having thinner capital bases.
The OCC is currently seeking approval to update its default-fund methodology to reflect more extreme stress scenarios, including 1987-style market shocks. The fund, roughly $20bn, is paid into by members and designed to cover defaults if the two largest firms go bust at the same time. Currently, 70% of the allocation is based on members facing a 5% market move.
