You are really missing what he's saying. That this particular default was subject to a bankruptcy judge means a few things that would bring alarm bells to any p

You are really missing what he's saying. That this particular default was subject to a bankruptcy judge means a few things that would bring alarm bells to any professional risk manager. Its not a _good_ thing, its just not the worst thing. A few off the top of my head: It went to bankruptcy at all. With more forceful regulatory regimes (eg banking/brokerages) they skip bankruptcy proceedings for the most senior debt holders entirely. The regulator steps in and disburses the funds much faster. The judge had discretion, there was no legal insulation to LedgerX's creditors. They just had maintained enough arms distance to satisfy a bankruptcy judge to rule in one set of creditors favor over another's. His point is that unlike in other regulatory regimes, nothing in the law, says that deposits at a CFTC exchange are more senior to any other liability. And the precedence on clearing house default is not extensive. Most risk managers would view the fact that this judge ruled in their favor as the saving grace to a mistake on the risk management side. Also, you are on tilt here. Statements like "You couldn't be more wrong on the facts here." are pretty embarrassing when you are misconstruing things so dramatically.