The industry expected new regulations to derivatives being proposed by Treasury Seretary Timothy Geithner this week, industry figures said.

The industry recognized that need and was headed in that direction, Larry Eiben, chief operating officer and co-portfolio manager at mutual fund TFS Capital, told Reuters.

CDS is one of those things where it doesn't take much capital to play that game, he said. Clearly, we need modern regulation for modern times and I think any product that is that substantial to the marketplace should be regulated.

A senior analyst at consultancy Aite Group said the measures should have been expected anyway. “Now it’s just official,” he said.

“He’s telling Congress basically where the market is already going. He’s not saying anything new,” Robert McWilliam, vice president of derivative trading at asset manager T. Rower Price told Reuters.