Over-the-counter (OTC) derivatives markets have grown significantly over the past two decades, and constitute a systemically important component of financial services activity. The use of central counterparties (CCPs) in OTC derivatives markets has also increased over this period. This is important because ‘central clearing’, as it is known, is a key way of managing risk within the system. This article builds on these by exploring the increasing use of CCPs in the OTC derivatives market. It begins with an overview of OTC derivatives markets and how these have grown over time, before looking at the increased use of central clearing. It then considers factors affecting the regulatory decision to require certain contracts to be cleared via CCPs and the outlook for a further increase in central clearing. The article concludes by discussing some of the policy implications of these developments.