20 percent of financial firms eyeing cryptocurrency trading soon, says survey

The high figure of financial firms interested in cryptocurrency trading in the nearest future signifies the possibility of entry of more institutional money in cryptocurrency markets. Moreover, 70 percent of firms showing this interest will trade cryptocurrencies in the next three to six months.  

One in five financial firms are considering trading in the next 12 months, says a survey by Thomson Reuters. Moreover, 70 percent of those showing this interest are planning to trade in the next three to six months. 22 percent say they will trade in 6 to 12 months.

The new survey involved 400 people across its trading solutions including Eikon and REDI, as well as its FX platforms. These included hedge funds, large asset managers, and trading desks at the biggest banks. Reuters said the result showed that cryptocurrencies were now widely known or rather more people are familiar.

Neill Penney, co-head of Trading at Thomson Reuters said although the cryptocurrency market is relatively small part of the entire financial market, the survey showed that the niche segment is “starting to enter the mainstream of the financial services industry.” He added that this was a major change from a year ago.

The news is optimistic about rising cryptocurrency markets. It comes even as the value of cryptocurrencies continued to pick up. The news adds to Monday’s news that Goldman Sachs made its first hire for cryptocurrency markets. The bank acknowledged last month that they are planning to trade cryptocurrencies. These are likely to continue boosting markets this week.

Specifically, the news signifies that more institutional money is about to enter crypto trading and business. This is according to according to Brian Kelly, founder, and CEO of BKCM.

The potential for more application of smart contracts

Thomson Reuters, which has operated in more than 100 countries for more than 100 years also provides prices for cryptocurrencies through its flagship financial desktop platform Eikon, as well as MVIS indices and CME bitcoin futures.

The company also recently launched MarketPsych Indices that scan and capture cryptocurrency news and social media sites and scores them in real time so as to capture market-moving sentiments.

The company focused on exploring the application of smart contracts through the provision of market data with BlockOne IQ platform, an Oracle framework for privately distributed ledgers operating on Corda or Ethereum.

Sam Chadwick, director of a strategy in innovation and blockchain at Thomson Reuters said,

“Throughout 2017 though, it’s been clear that beyond the potential use cases of smart contracts, industry participants are increasingly seeing the potential of crypto assets as a new asset class as it provides financial institutions with operational effectiveness and is starting to become an asset that their institutional clients are increasingly interests in holding as part of a diversified portfolio.”

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Image Source: Cryptocurrency Trading

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David Kariuki is a journalist who has a wide range of experience reporting about modern technology solutions including cryptocurrencies. A graduate of Kenya's Moi University, he also writes for Hypergrid Business, Cryptomorrow, and Cleanleap, and has previously worked for Resources Quarterly and Construction Review magazines.

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