Will the new regulatory regime for OTC markets impede financial innovation?

Central clearing and settlement for standardised products provides private and systemic benefits with few costs. The required central clearing of non-standardised products would not be a good idea. To get the balance right, there should be some costs (be it capital adequacy or other) for non-central clearing and settlement which would encourage all standardised products to be centrally cleared, but allowing for non-standard products to exist if they can justify their existence through the added regulatory costs. There are some competition concerns. The regulatory requirement for central clearing gives monopolistic powers to clearers and vertically integrated institutions and there needs to be a counter-veiling competitive pressure such as the requirement of central clearers to accept clearing from different trade execution platforms.