Greenwich Associates, a leading global provider of market intelligence and advisory services to the ﬁnancial services industry, has come up with a report on top market structure trends to expect in 2017.
Greenwich Associates called the year 2016 the Year of the Unexpected, as Brexit, Trump’s victory at US presidential elections and the Chicago Cubs upended “likely outcomes.” Put it to the failure of a liquidity crisis in the bond market and the ongoing blockchain buzz. Financial markets have outlined the way forward but now they face possible difficulties if a Republican Washington will reverse laws and regulations that the industry has spent several years and billions of dollars adapting to.
However, the report of Greenwich Associates sounds rather optimistic. The perspectives look better for capital markets participants as banks have managed to gain more revenue from volume-creating events and the tendency is likely to continue. Interest rates are finally rising, increasing bank profits and benefiting the market in general.
“Deregulation—or at least no new regulation—is likely to be the theme driving Washington for at least the coming year. And while the full impact of MiFID II still remains unknown, we’re hopeful the market will adapt throughout the implementation phase, leaving the markets more efficient but not over-regulated”, the report states.
Greenwich Associates marks blockchain as one of the brightest trends to develop in 2017.
There is an opinion that the importance of the blockchain might have been magnified. However, Greenwich Associates can’t agree. Taking into account that the company focuses on complex market structure issues across equity, fixed-income and FX markets, it is even more amazing that its blockchain research was the most-read by capital markets clients in 2016.
Bitcoin has also gained considerable attention in 2016. The ability to transfer value around the world with no need for a middleman continues to have the biggest appeal. No wonder that the cryptocurrency price has passed a $1,000 barrier in the first day of 2017.
A number of political and economic events including the devaluation of the yuan in China, monetary reforms in India, the economic crisis in Venezuela and the shock results of popular votes in the Brexit referendum, the US presidential election and the Italian constitutional referendum, have altogether caused the increased demand for bitcoins, pushing the price upwards.
At the very end of 2016, Hyperledger Project, a collaborative effort created to adopt blockchain technology for business aims, announced that eight members were to join the project. The new participants were CA Technologies, Factom Foundation, Hashed Health, Koscom, LedgerDomain, Lykke, Sovrin Foundation and Swisscom. Together, companies will focus on the creation of an open standard for distributed ledgers for a new generation of transactional applications.