They have existed since the crash of 1929. There were no algorithms in place then. The goal was just to force human traders caught up in the moment to take a break and stop panicking.
I assume they have been tweaked since 1929, but they started with the crash back then.
Edit: someone else is claiming 1987 as the start. My memory says 1929. If this matters do your own research.
> Regulators put the first circuit breakers in place following the market crash of October 19th 1987, when the Dow Jones Industrial Average (DJIA) shed 508 points (22.6%) in a single day. The crash, which began in Hong Kong and soon affected markets worldwide, came to be known as Black Monday.
> In 1933, the U.S. Congress passed the Glass–Steagall Act mandating a separation between commercial banks, which take deposits and extend loans, and investment banks, which underwrite, issue, and distribute stocks, bonds, and other securities.
It probably doesn't make sense for an individual actor to stop trading when all the assets it holds are tanking. Everyone's selling to cut their short-term losses. Crashes aren't always feedback loops.
You do not want to trust your market's health to some random trading firm's coding skills and goodwill, just like you wouldn't open up a public webservice without some basic rate-limiting.
