Morgan Stanley Follows The Lead of Goldman Sachs in BTC Futures Clearing

Morgan Stanley Follows The Lead of Goldman Sachs in BTC Futures Clearing

Things are becoming more exciting in the world of big investment. Maybe, the two bulls will butt the heads, as the prime worldwide financial services firm Morgan Stanley is getting on the bitcoin-based futures craze. Just like its adversary, multinational finance company Goldman Sachs, it is now clearing BTC futures contracts. And that is done for institutional depositors.

Moreover, the firm is going to hold an orderly appointment of executives at which they will think of the other ways of joining the world of digital currencies. This information was spread by Morgan Stanley chief financial placeman Jonathan Pruzan in a telephone conversation with Bloomberg journalists on January 18.

“If someone wants to do a trade on the futures and settle in cash, we’ll do that. I wouldn’t say it’s been a lot of activity, but it’s for core institutional clients who want to participate in a derivatives transaction,” explained Pruzan.

The financial officer also avoided answering the question concerning how much the firm demanded. However, Pruzan added that the unstable nature of BTC futures contracts was a reason why they set up margin levels.

By now, Morgan Stanley made a decision not to engage with crypto storage or market-making, even though the leadership has been considering this issue very meticulously.

Cboe’s & CME Rally

It has been one month since Cboe Global Markets Inc. and CME Group Inc. received a green light from the U.S. Commodity Futures Trading Commission to trade bitcoin-based futures. Cboe was the first to implement such futures and was met with considerable attention. Then it was the turn of the world’s most outstanding futures exchange CME Group to establish BTC derivatives products.

What is unique about CME’s futures is that they are based on five bitcoins, whereas Cboe’s contracts are only pegged to one BTC.

Also, in December 2017, Goldman Sachs required several customers hold over funds peer to the whole value of their BTC futures trade as a clause for clearing the transaction, holding back a bunch of clients.

First Expired BTC Futures Contract

By the way, on January 17, the first BTC-based futures contract was closed by Cboe at $10,900. Before the closure, the crypto market survived a comparatively rough week, during which bitcoin’s price lowered to $9,402. However, when the futures closed two days before, bitcoin’s rate went down by 36%, according to the Cointelegraph.

So let’s keep an eye on the rivalry, as the show will go on.