TP ICAP, the world's biggest interdealer broker, is set to launch a crypto trading platform for institutional investors.
The platform is being developed with crypto custody providers Fidelity Digital Assets and Standard Chartered's Zodia Custody, alongside liquidity provider Flow Traders. The idea is to provide clients a separate but interoperable model for execution and settlement.
Simon Forster, co-head of digital assets at TP ICAP, said the current crypto market infrastructure prevents many institutional clients from trading because most execution venues require pre-funding and also act as custodians.
"This poses challenges from a conflict of interest perspective and results in fragmented liquidity," said Forster. "Our partnership, and resultant new platform, is a natural evolution in market structure that will make digital assets, such as Bitcoin, more accessible for the wholesale market."
The platform is subject to registration with the U.K.'s Financial Conduct Authority and is expected to launch by the end of this year. It will allow institutional clients to spot trade in bitcoin (BTC) and ether (ETH).
TP ICAP is the latest traditional financial services firm to enter the crypto spot trading market. In recent months, megabanks, including Goldman Sachs, Morgan Stanley, and Citigroup, have launched their own internal initiatives to help private wealth management clients access the crypto market. Earlier this month, Standard Chartered also announced its plans to launch a crypto brokerage and exchange platform in the U.K. and Europe, along with Hong Kong-based BC Group.
As for TP ICAP, it launched its Digital Assets business in 2019 and currently enables clients to trade crypto derivatives products on the exchange giant CME Group.
For its spot crypto trading platform, it expects to partner with more custody partners and more liquidity providers in the future. Zodia is also in the process of registering with the FCA and expects to launch commercially later this year.
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