SC Ventures, the venture capital arm of Standard Chartered, announced earlier this month a partnership with Chinese investment holding company BC Technology Group to launch a new cryptocurrency brokerage and trading platform. The digital asset market seems to be a strategic priority for the British group, as it has just announced another partnership, with financial giants, involving another trading platform dedicated to Bitcoin.
A new crypto exchange model dedicated to institutional investors
TP ICAP, the world’s largest inter-dealer broker, has just announced the launch of a crypto trading platform with Fidelity Investments and Standard Chartered’s digital asset custody division, Zodia Custody. Interdealer brokers – or interdealer brokers – are financial intermediaries that facilitate transactions between brokers, investment banks and other financial institutions. As such, they are one of the key cogs in the wheel of traditional finance.
The platform will provide a post-trade infrastructure, with a network of digital asset custodians and separate execution and settlement, which is widely seen as the key to greater participation by large investors.
Currently, order execution and custody services for cryptocurrencies are typically provided by a single entity, which increases credit risk. Indeed, on an exchange like Binance or Kraken, both the custody of funds and the execution of your transactions will be provided by the exchange :
“Investor interest in this new asset class has exploded dramatically in the last 6-8 months […] In most conversations with our clients, they want separate custodian roles and execution capabilities, which is the opposite of the current existing models. ”Duncan Trenholme, co-head of digital assets at TP ICAP
According to information from Reuters, the platform will only allow Bitcoin trading, with Ethereum to be added later. The consortium of financial players intends to launch its platform in the second half of 2021. TP ICAP thus joins the ranks of major players in traditional finance wishing to enter the digital assets market in a sustainable way