Most of us are now using Windows 10. Each new version improved functionality and reliability. The most widely used benchmark—the London Interbank Offered Rate (LIBOR)—was first published in 1986, a year after Microsoft released Windows. It has undergone only one material change in the past 30 years and was certainly never originally designed to support what has become a $ trillion market.
Now, it is difficult to imagine modern financial markets without derivatives enabled by benchmarks.1 However, just as Windows 1.0 isn’t versatile enough to support new computer programs that have been introduced over the past 30 years, many benchmarks are no longer suitable for the wide array of derivatives markets they support.