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Hayley’s
Comment
Crypto craze
Hayley McDowell offers her take on the cryptocurrency craze and a
new, dedicated website in this space from The TRADE.
T
hese days, everybody is talking
about crypto, from the latest
price swings and scandals to any
sniff of potential regulatory inter-
vention.
News of Cboe and CME Group
launching Bitcoin futures late last
year arguably marked the beginning
of this shift, alongside the US fi-
nancial watchdog’s decision to shut
down the possibility of a Bitcoin
exchange-traded fund (ETF) launch
due to regulatory, valuation and
liquidity fears.
Those fears remain the same
today. For institutional investors
looking to enter the crypto space,
a regulatory endorsement could
prove to be a game-changer. A lead-
ing exchange operator’s markets
division head told delegates at a
recent conference despite regula-
tors halting any progress to launch
Bitcoin ETFs, Bitcoin futures will
help put some kind of regulatory
98 // TheTrade // Summer 2018
framework in place for cryptos on
listed exchanges.
In other words, Bitcoin futures
could lay the groundwork for an
even greater crypto ecosystem in
the near future. Certainly we can
expect more major banking players
to launch their own crypto futures
product, whether that be for Bitcoin
or other digital assets like Litecoin
or Ethereum, but a shift towards
institutional trading of cryptocur-
rencies requires far more work.
Bitcoin futures may go some way
to breaking down any resistance but
ultimately regulatory oversight of
cryptocurrency trading is arguably
the greatest barrier for institu-
tional investors. Cryptocurrencies
are global in nature, but financial
regulation is far more regional and
fragmented. It’s hard to imagine
regulatory consistency and con-
vergence on the same scale as the
global crypto market, but unlocking
that potential cross-border business
on the institutional side of the
industry could catapult crypto to
new heights.
I must confess the growth of
the crypto universe has indeed
captured my attention over the past
year, along with so many others,
and (luckily for me) there have been
some interesting developments
around crypto at The TRADE.
This includes the exciting launch
of our new website, The TRADE
Crypto, which will bring the buy-
side community news about the
growth, progress and future of
global institutional cryptocurrency
trading. It seems quite far-fetched
at this point in time to imagine
traditional asset managers dipping
their toes into Bitcoin, but with
the pace the crypto industry has
been moving at over the past year
or two, I certainly wouldn’t rule
anything out.