Wait a tick. That’s how most stock exchanges will cope with the coming “leap second” on June 30.
What’s a leap second, you may ask? Well, you’re probably familiar with the concept of a leap day, wherein timekeepers add an extra 24 hours to the calendar every four years in order to keep the annual schedule in sync with Earth’s circuit around the Sun.
When humans began measuring time with atomic precision in the late ’60s, they stopped depending on the sunrise and sunset cycles of the spinning planet. But those two measures—microwave emissions from cesium-133 (atomic) and the Earth’s spin (planetary)—aren’t perfectly in agreement, as the Earth’s rotation is constantly slowing. In order to correct the mismatch, we throw an extra second into the mix every few years. Without that refinement, timepieces would become skewed.
To date, there have been 25 leap seconds. The first occurred in 1972; the last in 2012. But this year’s leap is different. For the first time since electronic trading conquered the financial markets, Bloomberg reports, the adjustment will take place during normal trading hours. The shift is slated for 8 p.m. ET—right as Asian markets are opening for business.
To rectify the disparity and avert glitchy disaster (think Y2K, but with less hype), markets in the U.S. are closing early while markets on the other side of the world are fixing their clocks ahead of schedule. Given the speed of today’s algorithm-juiced marketplaces, a single second represents millions of dollars in potential trades.
Here’s exactly how various markets are addressing the problem: Nasdaq and NYSE Arca Equities have decided to close shop early. Intercontinental Exchange (ICE) and CME Group (CME) have said they’ll delay transactions. And at futures exchanges in countries like Australia, Japan, and South Korea—where $3.7 billion is at stake at the opening bell, according to Bloomberg — they will take the Google approach and “smear” the extra time over a longer period of time. In other words, they’ll cut the second into smaller bits and spread it out across several hours.
In 2012, websites such as LinkedIn, Reddit, and Yelp experienced issues due to the leap second.
As for us over at Fortune, we’ll be following one of John Oliver’s suggestions.
