The CME, the world’s largest futures exchange, and Citadel, the hedge fund, were Tuesday given the green light by Washington regulators to launch a clearing house for credit default swaps.

The CME’s clearing solution was given the go-ahead by the Federal Reserve Bank of New York and the Commodity Futures Trading Commission, while the exchange said it had had “extensive discussions” with the Securities and Exchange Commission and was “well along in the SEC review process”.