The cover of Flash Boys, by Michael Lewis, examines the impact of high-frequency trading.PATRICIAL WALL/The New York Times
Last week, we told you that Brad Katsuyama, formerly a trader at Royal Bank of Canada, was about to become a celebrity. Now it's official.
Earlier today, Mr. Katsuyama was at the centre of a heated panel discussion on CNBC where he took on William O'Brien, president of BATS Global Markets, over the impact of high-frequency trading.
The debate grew so intense that traders at the New York Stock Exchange – where the show was being taped – stopped working and trained their attention on nearby television screens.
Mr. Katsuyama is the chief executive officer of IEX Group Inc. and the hero of the new book Flash Boys, by Michael Lewis. The book tells the story of Mr. Katsuyama's quest to find out if and how high-speed traders were front-running his transactions – a journey he began while at RBC.
Released on Monday, the book has set off a media firestorm and highlighted continuing efforts to probe "predatory" high-frequency trading. The U.S. Federal Bureau of Investigation is scrutinizing such practices, as is the Attorney-General of New York State.
Mr. Katsuyama – who is portrayed in Flash Boys as a decent, humble, nice Canadian – is now one of the faces of that debate.
On CNBC, Mr. O'Brien launched the first salvo, saying that Mr. Katsuyama and Mr. Lewis should be ashamed of themselves for saying the stock market is rigged and for frightening average investors.
Mr. Katsuyama, for his part, refused to back down. "I believe the markets are rigged. And I also think that you're a part of the rigging. So if you want to do this, let's do this," he countered.
"People want to know the truth," he said. "Everything is not fine." He added that he has been contacted by whistleblowers, but didn't elaborate.
The testy exchange reminded some viewers of the classic televised fight between Carl Icahn and Bill Ackman over Herbalife last year. "Still not as epic as Icahn/Ackman but entertaining," tweeted someone with the handle Ed Bradford, identifying himself as a bond trader in Connecticut.
After the discussion, Mr. Katsuyama walked on to the floor of the exchange to a round of applause from the traders. He didn't immediately respond to requests for further comment.
Follow Joanna Slater on Twitter at @JSlaterNYC.