Referring to insiders, Bloomberg reports that the American multinational investment bank Morgan Stanley is jumping on a crypto-bandwagon. According to the report, the company might offer bitcoin swap trading to its customers. Therefore, it may join Wall Street entities in the race of exposing their clients to the market of digital currencies.
Not Sure, But Possible
Morgan Stanley clients may soon get an opportunity to trade in complex derivatives which will be bound to bitcoin, the most valuable cyber-asset in the world. The move is reportedly planned by the financial company, informs Bloomberg citing an anonymous source.
How Will It Work?
Morgan Stanley, perhaps, intends to work with contracts which expose investors to the execution of bitcoin. Moreover, the investors will use soi-disant price return swaps. These will allow them to go either short or long. Finally, the American bank will charge a spread for each operation, the news agency singles out.
In fact, the bank is not going to trade BTC directly. The insider underscored the swaps will be bound to BTC-futures. Even earlier in 2018, the bank’s top executive James Gorman made it clear that the bank has no intentions to let its users purchase and vend cryptos directly via the entity. As an alternative, it would establish a trading desk for aiding different crypto-related derivatives.
For the purpose, Morgan Stanley engaged Andrew Peel who from now on will be ruling over virtual coin markets. Previously, Peel worked for Credit Suisse Group AG, and he came to Morgan Stanley earlier this summer, as the source notified.
When Will the BTC Swap Trading Be Launched?
According to the private information, Morgan Stanley is already ready for the BTC swap trading in terms of technical aspect. The launch of the project will occur when two things happen. Firstly, there must be a reasonable demand from institutional investors, the source highlighted. And secondly, Morgan Stanley has to finalize the approval of the idea from the within. It is noteworthy that the official representative of the American ban refused to commentate on the issue.
Morgan Stanley Isn’t Alone
Due to the high volatility of the actual cyber-assets market and problematic regulatory issues in the niche, many considerable banks look for additional options for exposing their clients to the world of cryptos. For instance, Wall Street’s banks are advancing with ideas for complex financial products which would be highly connected to bitcoin or its brethren. The fact that their prices go beneath derivatives does not stop them.
Among other significant financial world players which are getting ready for embracing bitcoin products, are Goldman Sachs and Citigroup. Both companies are preparing novel BTC-based products. In the meantime, bitcoin is losing its positions. Since the last year, this coin has lost over 65% of its value and is not showing any upward trends.
While Citigroup is elaborating on a new system for trading virtual assets, Goldman Sachs is studying the case of BTC-derivatives which are labelled non-deliverable forwards. Furthermore, the latter also plans to offer guardianship to funds of digital assets.
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