This concept already exists: it's a batch auction dark pool.
One big problem with batch auctions as a global solution is that conceptually, trades span multiple markets. You have to figure out how your 500ms futures batch auction is going to interact with the unrelated market for the underlying instrument.
Probably the biggest problem is the problem itself, which, in the case of HFT, probably just isn't enough of a problem to reengineer all of market microstructure to fix. The biggest pure HFT firms are worth just a fraction of the biggest investment firms. Major purchasers of liquidity (pension funds, Vanguard) are happy with the execution they're getting. None of this stuff hurts retail traders (on the contrary, it probably helps them on the whole).
One big problem with batch auctions as a global solution is that conceptually, trades span multiple markets. You have to figure out how your 500ms futures batch auction is going to interact with the unrelated market for the underlying instrument.
Probably the biggest problem is the problem itself, which, in the case of HFT, probably just isn't enough of a problem to reengineer all of market microstructure to fix. The biggest pure HFT firms are worth just a fraction of the biggest investment firms. Major purchasers of liquidity (pension funds, Vanguard) are happy with the execution they're getting. None of this stuff hurts retail traders (on the contrary, it probably helps them on the whole).