3 Minutes to Read by 3 Minutes to Read by 3 Minutes to Read by 3 (Reuters) – LONDON (Reuters) – The world’s largest interdealer broker, TP ICAP, is partnering with Fidelity Investments and Standard Chartered’s digital assets custody unit to develop a cryptocurrency trading platform, the consortium announced on Tuesday. In this image illustration taken on June 14, 2021, a depiction of the virtual cryptocurrency Ethereum is shown among representations of other cryptocurrencies. Illustration courtesy of REUTERS/Edgar Su The platform, which is set to open in the second half of the year, will initially allow institutional investors to trade bitcoin, with the second-largest cryptocurrency ether to be added later. TP ICAP, together with Fidelity Digital Assets and Zodia Custody, which were launched in December by Standard Chartered’s venture capital arm and Northern Trust, aims to make crypto trading comparable to those of traditional assets such as equities, bonds, and foreign exchange. According to the consortium, the platform would include post-trade infrastructure with a network of digital asset custodians, as well as independent execution and settlement, which is widely considered as critical to attracting larger risk-averse investors to the burgeoning crypto market. Currently, crypto execution and custody services are frequently combined in a single location, which increases credit risks. Flow Traders, based in Amsterdam, will offer liquidity to the platform. TP ICAP has expanded its worldwide capital markets footprint by launching new data and analytics services as well as new products. Dedicated crypto funds have received record inflows this year, but big banks that provide access must reconcile growing demand with the long-standing compliance issues that have plagued the cryptocurrency sector, as well as increased regulatory scrutiny. Nonetheless, the move is the latest support of the industry by Standard Chartered, whose venture capital arm said earlier this month that it will partner with Hong Kong’s BC Technology Group to launch a new crypto brokerage and exchange platform in the United Kingdom and Europe. “In the last six to eight months, investor interest in this new asset class has surged substantially,” Duncan Trenholme, co-head of digital assets at ICAP, told Reuters. “In majority of our customer engagements, they desire a separation of custodial roles from execution capabilities, which is the polar opposite of the current models.” TP In 2019, ICAP debuted bitcoin futures and options on the CME, and it now wants to offer new derivatives such as total return swaps and non-deliverable forwards. The platform is awaiting authorisation from the Financial Conduct Authority of the United Kingdom. According to ICAP, neither Standard Chartered nor Fidelity Investments have made investments in the platform. Saikat Chatterjee and Tom Wilson contributed reporting, and Rachel Armstrong and Kirsten Donovan edited the piece. Continue reading
