ISDA's new credit definitions, announced this week and due to come into effect in March, are intended to address flaws in the contract and make adjustments for new regulations. Some fear that allowing assets other than bonds to be delivered into credit default swaps auctions around government-debt restructurings could create a "two-tier" market with arbitrage opportunities. Others, however, have noted that after 2003 credit definitions went into effect, liquidity quickly migrated to the new CDS.

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