Cryptocurrency derivatives were discussed at a closed meeting of the largest players in the industry.



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Cryptocurrency derivatives were discussed at a closed meeting of the largest players in the industry

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Cryptocurrency derivatives were discussed at a closed meeting of major industry players. In January this year, about twenty representatives of the largest players in the cryptocurrency and traditional financial markets, including Binance, Coinbase and Goldman Sachs, discussed the further development of the industry at a closed meeting.

It is reported by Bloomberg. The organizer of the meeting, called the Crypto OTC Asia Round Table, was made by Ho Lon Leng, formerly Vice President of JP Morgan and Managing Director of Goldman Sachs, and now Kyber Network project adviser.

The meeting took place in the period of a prolonged fall of the cryptographic market, and its goal was to develop a strategy on how to make cryptocurrency part of the global financial architecture through the creation of an orderly cryptocurrency derivatives market.

According to the publication, the roundtable participants discussed the introduction of such a new class of assets as private bilateral crypto derivatives or OTC contracts instead of bitcoin futures. It is worth noting that, unlike futures contracts traded on open markets and managed by regulated companies such as CME, over-the-counter contracts are not yet standardized.

“We are witnessing the emergence of a new asset class,” said one of the meeting participants, Simon Nursi, co-founder of the CORA Network. He also noted that although there are no official statistics on bilateral trade in crypto-withdrawals, the volume of transactions on swaps and options in this niche is about $ 750 million per month.

Following the meeting, it was also decided to create the first clearing center for such assets, which should contribute to the growth in trading volume and reduce costs. An enterprise called Liquidity Offset Network should begin work in July and will be regulated by the Monetary Authority of Singapore, which acts as the central bank.

Liquidity Offset Network should become a central counterparty providing services, including margin calculations and confirmation of transactions. According to Nursi, the development of cryptoindustry could also be facilitated by the adoption of general guidelines on trade agreements, which would lay the foundation for the adherence of institutional investors and banks to Wall Street.

He also noted that although some large companies are really considering the possibility of investing in cryptocurrency, most of them are still left out because of insufficient regulation of this sphere.

According to the publication, the digital asset market today resembles the derivatives market of traditional currencies of the late 1990s. in Asia, which also began with several knowledgeable dealers and grew rapidly, as these types of assets quickly became widespread.

In the case of cryptocurrency derivatives, the repetition of such a scenario is very likely. It is reported that in May, CORA will hold a second meeting in Chicago to attract more American traders to the initiative. Note that while global regulators are not too positively disposed towards cryptocurrency derivatives.

For example, last year the European Securities and Markets Authority (ESMA) announced a tightening of its policy on such financial instruments, while the Financial Conduct Authority of the United Kingdom (FCA) wanted to ban cryptocurrency derivatives.

Nevertheless, platforms continue to launch trading in similar assets. So, in November, the stock exchange specializing in cryptoderivatives launched Huobi, in March, Caspian’s asset management platform started to offer such tools to institutional investors, and recently it became known that BitMEX Bitcoin derivatives will appear on the Trading Technologies trading platform.

Cryptocurrency derivatives were discussed at a closed meeting of the largest players in the industry



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