Large trading firms will be able to access both Bitcoin markets and Bitcoin futures from March this year following a partnership between Coinbase and Trading Technologies International.
Partnership between Trading Technologies International Inc & Coinbase
The deal will let the institutional investors access Bitcoin spot prices and Bitcoin futures on the same screen. This means they can trade both or make a decision on which asset to trade in at any particular time.
Although the number of institutional investors in Bitcoin has been increasing in the recent past, most of traders still remain retail traders. Bitcoin futures were launched with the same intention of helping more institutional investors to trade in related products although they have had virtually no impact on prices. Many saw them as a legitimation of cryptocurrencies.
Cash-settled Bitcoin futures and more
Chicago-based Trading Technologies has a connection to 45 markets including CME and Cboe, which launched cash-settled Bitcoin futures this last December. Its customers also include Goldman Sachs Group Inc and JPMorgan Chase.
“We’ve had a lot of demand from the institutional trading community, everything from the traditional buy-side, hedge funds, managed accounts, the prop community, that I think have been looking for a bridge like this as a way to trade the crypto markets against the cash markets,” Rick Lane, TT’s chief executive officer, said in an interview.
The company also wants to launch surveillance tools to police crypto trading.
Coinbase targets institutional traders who want to trade cryptocurrencies by introducing custodian offering with strict financial controls and secure storage.
“This is the first time hundreds, if not thousands of institutional clients will have the ability to trade the crypto spot market side by side with 45 other markets,” said Adam White, general manager of Coinbase’s Global Digital Asset Exchange (GDAX).