The problem hit the BATS exchange in Europe, but Chi-X traders escaped the issue as that exchange's systems have not yet not been integrated — BATS only closed its takeover of the company last week. BATS' US market was also unaffected.
Chi-X is likely to be migrated to the BATS platform in the next year, and IT planning is currently underway. The platform runs on a Linux-based datacentre and is hosted by Equinix – with servers in Slough for European traders.
The problem began at 9.36 am yesterday and the company decided to halt trading for the rest of the day.
BATS traders who were affected work for a range of high profile financial institutions, including Citi, Deutsche Bank, JP Morgan, Barclays Capital, Goldman Sachs, HSBC, Nomura, the Royal Bank of Scotland and smaller finance houses.
BATS Chi-X declined to name the specific hardware in question, but said the "responsible" option of stopping trades was taken until the issue was resolved. Similar problems at other exchanges have often come down to network switches or data interface devices, though it has not been confirmed in this instance.
Trading on the exchange has operated normally today.
Chief executive Mark Hemsley said the faulty component was quickly replaced, but that when trade data was checked a number of errors were identified. This prompted the continued stoppage.
"We believe this was the most responsible course of action in order to ensure trade data integrity and an orderly market," he said.