The credit derivatives industry faces a Big Bang today and yesterday participants were rushing to sign up to a new protocol designed to counter the intense criticism that has emanated from political and regulatory quarters over the industry's alleged role in contributing to the market crisis.

At the eleventh hour, dealers and investors besieged the International Swaps and Derivatives Association ahead of implementing a self-styled “Big Bang” protocol.

This protocol, which has been adopted by some 1,500 players – mostly in recent days, if not hours – aims to introduce more consistency into the credit default swaps market by imposing a uniform procedure for settling CDS contracts when a company goes into default (see box). It also tries to impose more standardisation by introducing set coupons for contracts – a measure that will initially be limited to the US, but could later spread into Europe.