Exclusive: TP ICAP to launch crypto trading platform with Fidelity, Standard Chartered

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By Saikat Chatterjee, Tom Wilson

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A representation of Ethereum virtual cryptocurrency can be seen among representations of other cryptocurrencies in this photo illustration taken on June 14, 2021. REUTERS / Edgar Su / Illustration

LONDON (Reuters) – TP ICAP, the world’s largest interprofessional brokerage, is launching a cryptocurrency trading platform with the digital asset custody unit of Fidelity Investments and Standard Chartereds, the consortium announced on Tuesday.

Institutional investors have warmed to the crypto sector this year and the platform, due to launch in the second half of the year, will initially allow them to trade bitcoins, with the second largest token ether to be added more late.

TP ICAP, along with Fidelity Digital Assets and Zodia Custody, launched by the venture capital arm of Standard Chartered and Northern Trust in December, seeks to make crypto trading similar to traditional assets like stocks, bonds and currencies.

The platform will offer post-trade infrastructure with a network of digital asset custodians, the consortium said in a statement, as well as separate execution and settlement, which is widely seen as key to further large involvement of large risk averse investors in the emerging crypto market.

Currently, crypto execution and custody services are generally consolidated in one place, which increases credit risk. Amsterdam-based Flow Traders will provide liquidity to the platform.

TP ICAP has expanded its presence in global financial markets by offering new data and analytics services and deploying new products.

Dedicated crypto funds have seen record inflows this year, but the major banks providing access must balance growing interest with compliance issues long associated with the cryptocurrency industry and growing scrutiny by regulators.

Yet the move is the latest industry approval by Standard Chartered, whose venture capital unit announced earlier this month that it would set up a separate crypto brokerage and exchange platform in Grande. -Brittany and Europe, with Hong Kongs BC Technology Group.

Investor interest in this new asset class has exploded dramatically over the past six to eight months, Duncan Trenholme, co-head of digital assets at TP ICAP, told Reuters. In most of our conversations with clients, they want a separation of custodial roles from execution capabilities, which is the opposite of the models that currently exist.

TP ICAP launched bitcoin futures and options on CME in 2019 and now plans to launch other derivatives, including total return swaps and undeliverable futures.

The platform is awaiting approval from the UK financial regulator. Neither Standard Chartered nor Fidelity Investments have invested in the platform, TP ICAP said.

Reporting by Saikat Chatterjee and Tom Wilson; Editing by Rachel Armstrong and Kirsten Donovan

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