More block trades are going electronic
For years, the narrative around fixed income electronification focused on smaller, more liquid trades—the efficiency-easy wins. Block trades (for example, trades in IG Credit over $5 million) were treated as structurally different and were thought to be too impactful, too sensitive, and too reliant on relationships and balance sheets to move onto screens. But the data is beginning to tell a different story.
In Q1 2026, electronic block trading on our platform reached record average daily volume of $6.6 billion, up 35% year-on-year. That growth was broad-based: US credit block ADV rose 27%, emerging markets 47%, and Eurobonds 45%. In January alone, block ADV was up 56% year-on-year, with EM blocks growing 92% and Eurobond blocks 89%.
Q1 Electronic block trading ADV rose 35% YoY*
| +27% | +47% | +45% |
|---|---|---|
| US credit block | EM credit block | Eurobonds |
*The data reflects a structural shift in how large trades are initiated, priced and executed across credit markets globally.
What’s driving this change
Several things are happening simultaneously to enable this shift.
First, dealers are getting better at managing risk electronically. Over the past five years, banks have materially improved their ability to recycle risk across algorithmic trading, portfolio trading, ETF hedging and interdealer channels (including our own all-to-all Open Trading® network). Electronic liquidity providers have expanded coverage, particularly in index-linked instruments where ETF pricing creates strong correlation across underlying bonds. When risk moves through the system more efficiently, larger trades naturally become more feasible to execute on screen.
Second, there has been a generational shift in behavior. A growing proportion of traders treat electronic workflows as the default, not the exception. Request-for-quotes (RFQs), algorithmic pricing, and data-driven counterparty selection are simply how they operate. That familiarity reduces friction and, over time, changes institutional habits.
But the deeper changes are in the information environment around the trade. A decade ago, the decision about whether to trade a block electronically was largely a function of size. If the trade was big enough, it went to voice. Today, the decision is a function of how much you know: how confident you are in the pricing, how well you understand the counterparty landscape, and how clearly you can assess execution risk.
Access to liquidity and data are what is now important.
Liquidity and the protocol question
One of the most common misconceptions about block electronification is that it converges on a single protocol. It does not. In practice, clients are dynamically choosing between multiple protocols depending on size, urgency and market conditions.
In emerging markets, for example, request-for-market for competitive, two-way pricing has become a critical on-ramp for trading larger sizes electronically, precisely because liquidity is regionally fragmented, episodic, and dealer balance sheet matters.
In US credit, Targeted RFQ (TRFQ) and dealer risk recycling protocols are scaling rapidly. Targeted RFQ, designed for trade sizes of more than $3 million, solves the dealer selection pain point by suggesting up to eight sell-side players that are axed or have recently been active in the relevant bond, allowing the trader to accurately define his or her selection. Our clients go on to invite 80% of TRFQ-recommended dealers onto their tickets. Mid-X, our protocol for anonymous mid-point matching sessions, uses advanced risk controls that limit exposure to ensure users are not left with skewed risk positions post-session. Mid-X ADV grew 168% year-on-year in Q1.
A variety of protocols allows the trader to select the right protocol for the right trade in the right conditions.
The data flywheel
Every electronic block trade generates data. Even if full transparency is not mandated (e.g. TRACE block masking) or desirable, aggregated market data can feed back into pricing models, execution analysis, counterparty and protocol selection tools. More electronic trading produces better data, which produces better execution.
At MarketAxess, CP+™—our AI-powered pricing engine—sits at the centre of this loop. It incorporates not just executed trades but the full set of RFQ interactions on the platform, including responses that do not result in a trade, giving our clients a significantly richer view of liquidity than execution data alone.
AI as interpretation, not speed
There is enormous excitement about AI in fixed income trading right now. The work we are doing to embed gen-AI and agentic features into our products and platforms is further enhancing the information environment around a trade, which will undoubtedly increase the market’s comfortability in trading blocks. AI Select is a good example of this. It uses a broad set of historical trading metrics—more than thirty in total—to identify the most suitable dealer for a given inquiry. These include win rates, responsiveness, and execution outcomes, all of which are continuously recalibrated throughout the trading day. In backtesting, it has shown strong predictive capability in identifying top-performing counterparties.
Where this goes
The direction is clear. The confidence to trade blocks electronically will continue to rise due to better information, better tools, and better risk infrastructure. Multiple protocols will continue to coexist, and the sophistication of protocol selection will become a meaningful differentiator. Data quality and coverage will matter most, and AI will add a deeper layer of insight and interpretation to electronic block trading.