China is removing servers used by high-frequency tradingfirms from local exchanges’ data centers, a move that could narrow the speedgap between professional traders and ordinary investors, according to peoplefamiliar with the matter. Retail traders may see slightly more balancedexecution, while high-frequency firms lose milliseconds of advantage incommodities and futures markets.China Exchanges Relocate HFT Servers GloballyCommodities futures exchanges in Shanghai and Guangzhou haveordered brokers to relocate client servers outside bourse-run data centers, accordingto Bloomberg. The Shanghai Futures Exchange told brokers that high-speedclients must move equipment by the end of next month, while other clients haveuntil April 30, the people said. The change is led by regulators and affectsboth domestic and global firms, including Citadel Securities, Jane Street Groupand Jump Trading.High-frequency traders rely on servers located in exchangedata centers to gain milliseconds in execution, an edge in markets where everymillisecond matters. Firms do not place servers directly in exchanges but uselocal brokers for access. Some brokers are also relocating servers forhigh-frequency clients away from the Shenzhen Stock Exchange’s data centers.Exchanges Plan Two-Millisecond HFT DelayPreliminary plans at futures exchanges could introduce anadditional two milliseconds of latency for servers connecting from third-partycomputer rooms, the people said. While the delay is minor for most investors,it could impact global high-frequency strategies in stock index futures,convertible bonds, and commodities.🇨🇳China Clamps Down on High-Speed Traders, Removing Data ServersChina is removing servers for high-frequency traders from local exchanges’ data centers, targeting both domestic and global firms. Shanghai and Guangzhou commodities exchanges ordered brokers to relocate equipment,… pic.twitter.com/iQQeq0Ajbo— CN Wire (@Sino_Market) January 16, 2026“High-frequency traders may adjust their strategies and arelikely to reduce their trading frequency in the short term, thus reducingbrokerage fees and server hosting fees,” said Shen Meng, director atBeijing-based investment bank Chanson & Co. He added that firms will“continue to design new solutions in the future.”Chinese Shares Fall After HFT ScrutinyThe move follows broader regulatory efforts to ensure marketstability. Earlier this week, authorities tightened rules on margin trading.Some ETF trades by foreign market makers have also been scrutinized. Chineseshares fell after the news, with the CSI 300 Index dropping after an earliergain, and copper futures on the Shanghai exchange fell about 1%.High-frequency trading in China has drawn regulatoryattention for years. Accounts placing more than 300 orders per second or morethan 20,000 requests per day dropped 20% in 2024, according to the ChinaSecurities Regulatory Commission.This article was written by Tareq Sikder at www.financemagnates.com.