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Is there a difference between a crossing network and an ECN? The wikipedia page for Crossing Network says that ECN is a type of crossing network. But crossing network has the smell of a semi-legal practice while ECN is perfectly legal. So what is the difference

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ECN is a regulatory status in the US, like MTF (Multilateral Trading Facility), and soon OTF (Organized Trading Facility) are in Europe.

"Crossing network" is a generic term used to describe a pool where brokers cross orders of their clients. The broker can choose to apply or not for the ECN (or MTF) status. On the one hand it is more "transparent" for users, on the other hand once it is regulated it is often easier for the broker to cross orders without asking for too explicitly.

It it thus not that obvious. Moreover you can ask the rulebook of its crossing engine to your broker and choose another one if you are not happy with it. Regulated pools nevertheless often offer guarantees for clearing (do your broker is his own clearer in its crossing network? oops).

In Europe with the just issued new version of MiFID, all pools will have to be regulated (but that's why OTF are created, they are not that constraining, but they will not be allowed on equities).

By the way "Dark pool" is a generic term too. You have similarly regulated or not dark pools, etc.

Update:

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+1,detailed answer. Would you know whether all crossed shares on ECNs and MTFs in the US have to be reported to the exchange for those shares that are listed on a national exchange? –  Matt Wolf Jan 17 at 2:42
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