TP ICAP, a London based broker that handles $1.5 trillion in daily volumes on trades of interest rates, credit, credit derivatives, foreign exchange, interest rate swaps, intellectual property (patents, via ICAP Patent Brokerage), and equity derivatives, is to launch a bitcoin exchange later this year with plans to add ethereum thereafter.
“Investor interest in this new asset class has exploded dramatically in the last six to eight months,” said Duncan Trenholme, co-head of digital assets at TP ICAP.
They’re to tap on this new market pending approval by the Financial Conducts Authority (FCA) through offering a separation between execution and settlement.
“The firms have collaborated to develop a new trading model where clients will be able to access liquidity at TP ICAP whilst their assets remain under custody at their digital asset custodian of choice, providing a level of security that institutional investors expect,” the company said.
Fidelity Digital Assets and Zodia Custody, a venture incubated by the innovation arm of Standard Chartered, will provide custodian services to the new platform.
“With this new infrastructure, we’re addressing one of the frictions in the investor experience that’s unique to this nascent asset class. Now, investors can more confidently execute trades knowing their assets remain still and secure in our custody,” said Chris Tyrer, head of Fidelity Digital Assets in Europe.
Flow Traders will provide liquidity to the platform. They being the biggest exchange-traded funds (ETF) trader in Europe, handling some $700 billion in ETF trading, which began market making on ethereum and bitcoin ETNs back in 2018.
“As the #1 market maker in cryptocurrency ETPs, as well as being a leading spot OTC liquidity provider, we have seen first-hand the increase in institutional interest in cryptoassets,” said Michael Lie, Head of Digital Asset Trading at Flow Traders. “We have long been in favour of initiatives such as this that will make the crypto space more accessible for investors.”
A number of traditional financial ‘pipeline’ infrastructure providers have began entering this space especially since last year following a considerable increase in interest by institutional investors.
This is the latest, and so far the biggest collaboration of different specialists towards providing crypto trading infrastructure at an institutional grade, so opening further market access for bitcoin and then ethereum.