Untangling the vast global derivatives industry from LIBOR just got a bit easier.

The London interbank offered rate (LIBOR) is hardwired into swaps and other contracts worth hundreds of trillions of dollars, but it's slated to disappear in the not-too-distant future. If the move to replacement rates doesn't go smoothly, that could cause major discord in markets.

A fix that takes effect Monday eases that risk for a large swath of the market, although there are still many hurdles to overcome in the benchmark transition. A new protocol has been put into place that allows LIBOR to be yanked out automatically and another rate swapped into its place—provided counterparties accept legal terms governing the industry. And while it doesn't cover everyone, nearly 12,000 entities—including big banks like Barclays Plc and JPMorgan Chase & Co.—have adopted this new method to obviate complicated negotiations with many trading partners.

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