The Fusion Digital Assets marketplace began trading bitcoin and ether versus the U.S. dollar last week.
Last week, TP ICAP, the largest interdealer broker in the world, announced that its Fusion Digital Assets marketplace for spot cryptocurrency trading had completed its first transaction. During a prolonged bear market and after a number of high-profile scandals rocked the industry, the traditional finance giant is bringing cryptocurrency to more institutional investors.
Simon Forster, global co-head of Digital Assets at TP ICAP Group said, “While the crypto-native landscape still feels a little somber, when we look at our traditional client base and we look at the relationships we’ve been developing, it actually feels reasonably optimistic, there’s a lot of people building interesting things. And it feels like 2022 is this watershed moment where the crypto landscape has changed, we think probably forever.”
Before offering any service to investors, traditional finance-tailored companies must implement strict governance and regulatory structures, which makes launching a new marketplace lengthy and challenging. Forster explained that TP ICAP intends to provide institutional investors with infrastructure that appears more familiar than that provided by vertically-integrated crypto exchanges that combine their exchange, custody, and other businesses, thereby creating potential conflicts of interest.
Fusion Digital Assets has a partitioned operational structure that consists of TP ICAP’s Fusion electronic trading platform, which provides the non-custodial crypto exchange, Fidelity’s Digital Assets SM as the custodian that holds and settles client assets, and an aggregation of liquidity sources that includes Flow Traders and XBTO Global. TP ICAP intends to hire additional custodians in the future to provide investors with more options.
The first transaction involved a bitcoin-U.S. dollar (XBTUSD) pair. The marketplace presently supports trading in bitcoin and ether (ETH) against USD, but the company is willing to add additional assets based on client demand.
The Digital Assets division of TP ICAP has existed since 2019. TP ICAP announced it would allow clients to trade crypto-linked exchange-traded products (ETPs) three years later. After registering with the Financial Conduct Authority (FCA) in December, the company obtained its UK crypto license, making the new Fusion Digital Marketplace accessible to regional merchants. Forster stated that the company intends to add additional supported regions as regulatory approvals allow.