Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.
Hedge fund and asset managers across the globe are getting more serious about cryptocurrencies with a big institutional money likely to flow in.
Although Bitcoin has always experienced the wrath of central banking institutions in the past many years, the cryptocurrency has successfully managed to sway the attention of global investors and now, it has been caught within the radar of big financial institutions. Industry report shows that one in five financial institutions are now planning to start buying cryptocurrencies within the next 12 months, according to the latest survey by Thomson Reuters.
Moreover, amidst the growing regulatory measures, most of the firms are also planning to launch cryptocurrency trading over the course of next with nearly 80% firms likely to do so within the next three-to-six months itself. Thomson Reuters survey shows a data of 400 clients being polled across different trading solutions like REDI, Eikon and FX platforms.
Neill Penney, co-head of Trading, Thomson Reuters said: “Cryptocurrency is still a relatively small part of the trading market, but this survey indicates this niche segment is starting to enter the mainstream of the financial services industry. This is a major change from a year ago.”
He further added: “The current priority for our clients appears to be seamless access to news and data around cryptocurrencies to facilitate informed trading decisions. As a leading provider of news, data, and trading capabilities, Thomson Reuters is well-positioned to deliver solutions that address client demand in the growing cryptocurrency market.”
Sam Chadwick, director for financial and risk innovation at Thomson Reuters says that big financial institutions started studying regarding crypto assets in the last few months of 2017. However, the cryptocurrency markets have witnessed a steep fall since the beginning of 2018 but crypto still remains a popular topic within the institutional class. Chadwick said that having conversed with several clients over the last few months, hedge fund and other asset managers are getting more serious about adding crypto to their portfolio.
In a word with CCN, Chadwick said that in January 2017, when he met institutional investors and talked to them about cryptos, most of them gave a “blank stare”. However, owing to the Bitcoin fever in the second half of 2017, the scenario changed completely. As a result, Thomas Reuters considered adding Bitcoin to its desktop platform Eikon in addition to its premium data feed for price discovery.
He said: “That was one year ago. And then coming into the end of last year into Q4, prices of cryptocurrency assets went bananas. Bitcoin started soaring. That landing page we created for bitcoin inside Eikon moved up to be No. 2 of all the FX landing pages after the euro.”
While commenting on this matter, Fraser Bell, Chief Commercial Officer of BSO said: “The more participants the greater the competition, which puts a greater emphasis on quickly evaluating vast quantities of crypto pricing data. This is where electronic trading firms can steal a march, by using their more sophisticated analysis to trade on information quicker than the rest of the market.”
He further added: “But for this to happen, crypto market data has to be easy to access and analyze in order to allow electronic traders to isolate what is useful from the large volumes of noise. Not difficult to manage in theory, but the relevant connectivity to new venues, such as the CME crypto futures exchange, is required to ensure a sudden spike whenever the next Swiftcoin or Litecoin surge materializes.”
It looks like as more clarity emerges on the regulatory measures ahead coming from the U.S and other parts of the world like Europe and Japan, institutional investors will soon be banking on the opportunity. Thus, it won’t be pointless to say that fasten your seatbelts now and get ready for the next big bull run.