United States cryptocurrency exchange Kraken has hired the ex-managing director of over-the-counter (OTC) trading platform B2C2 to head of development at its new Bitcoin futures operation. Kevin Beardsley, who previously led the United Kingdom-based company for a year, will now oversee Kraken Futures’ expansion as volumes hit $2.5 billion in June. Beardsley confirmed the news linking to comments he made to cryptocurrency news outlet The Block. “Being a pretty wide range of different types of participants, I have a pretty good understanding of what people are looking for and how to meet those needs,” he said. Kraken acquired its futures …

The United States Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) outlined regulatory compliance issues for cryptocurrency custodians in an announcement on July 8. According to the joint statement, the organizations have yet to discover a set of circumstances in which a crypto custodian could comply with the SEC’s Customer Protection Rule, which is described as follows: “Put simply, the Customer Protection Rule requires broker-dealers to safeguard customer assets and to keep customer assets separate from the firm’s assets, thus increasing the likelihood that customers’ securities and cash can be returned to them in the event …

Grayscale’s Ethereum-based security, Grayscale Ethereum Trust (ETHE), is available for trading on OTC Markets, according to an official blog post from Grayscale Investments on June 20. According to the post, ETHE is “an open-ended trust that holds Ethereum.” As further noted, this is a means of investing in Ethereum without having to actually hold the cryptocurrency. This means that the “first U.S.-based publicly quoted security solely invested in and deriving value from the price of Ethereum is available.” Grayscale’s Director of Investments and Research Matt Beck commented on how investing in Ethereum can help investors build a profitable portfolio, saying: …

Mike Novogratz’s crypto investment bank Galaxy Digital is expanding its services to offer crypto options contracts trading, industry media outlet The Block reports on June 21. According to the report, Galaxy Digital’s new initiative is made in response to increasing demand from institutional investors in order to hedge the high volatility that is a calling card of crypto assets. Bitcoin (BTC) options are a type of crypto derivative that are a wide-spread method of profiting from a highly volatile market by strategically hedging risks such as reducing portfolio risks, and in turn, losses from trading. Similar to traditional finance, there …

Ex-Bitmain CEO Jihan Wu could launch his newest venture next month, according to a report by The Block on June 5. One unnamed source told the website that the crypto services startup, called Matrix, “will be the biggest over-the-counter (OTC) desk and asset manager overnight.” Matrix’s OTC offering is likely to be boosted by its close ties to bitcoin (BTC) mining company, Bitmain. The new business will reportedly offer custody and lending services to the Beijing-based giant, receiving a liquid pool in return. Another of the four unnamed sources told The Block that such high levels of liquidity could result …

How are these issues solved? As the OTC market evolves, companies are working on building trusted custodial solutions and risk management systems. The OTC market is expected to continue steadily growing, and the financial insiders are exploring new ways to make these deals more secure so that institutional investors might be more involved in crypto. For instance, Fidelity, the world’s fifth-largest asset manager, is developing a cold storage to hold the assets from large over-the-counter crypto trading firms. Meanwhile, Coinbase has integrated its custody service with its own OTC desk, which enables customers to use the OTC desk to price …

Bitfinex-owned hybrid cryptocurrency exchange Ethfinex Trustless announced the launch of its on-chain decentralized over-the-counter (OTC) service in a press release shared with Cointelegraph on June 3. The system allegedly has no centralized order book or matching engine, and only financial instruments are restricted from the platform. Furthermore, the press release claims: “Customers can trade any ERC20 token, and even specify custom Ethereum addresses for tokens which are not currently listed on any exchanges.” Per the release, the new system uses blockchain to enforce an OTC transaction as an atomic swap. This removes the need for an escrow, according to the …

Tim Plakas has left the major United States crypto exchange Coinbase to join the cryptocurrency bank founded by Michael Novogratz, Galaxy Digital, an anonymous source purportedly told The Block on May 28. Plakas’ departure follows four senior executive departures from Coinbase in approximately the last seven months. Plakas reportedly held the position of over-the-counter (OTC) trading head at Coinbase from July 2018 to January 2019, and will be joining the OTC team at Galaxy Digital. Novogratz’s crypto bank is a member of Crypto OTC Roundtable Asia (CORA) Network, a non-profit collective of companies that want to improve the Crypto OTC …

Two Chinese over-the-counter (OTC) traders have been accused of running an illicit bitcoin (BTC) loan scheme and collecting bitcoin by promising interest on deposits, Chinese newspaper The Beijing News reports on May 22. According to the article, Yi Zhou and Xiang Li convinced traders to send them their bitcoin holdings by promising them interest on their deposits, obtaining over 7,000 BTC (nearly $54.7 million at press time) from over 100 investors. The allegedly defrauded investors first started cultivating suspicions when the interest — which was paid in yen — stopped arriving on time in April. The two individuals reportedly gained …

On May 7, Dovey Wan, founding partner of crypto investment firm Primitive Ventures tweeted that the Chinese social media behemoth and payment service provider WeChat is set to ban merchants from making cryptocurrency payments. This ban marks the latest effort to stymie cryptocurrency usage in China, with the government also mulling over ways of greatly decreasing the presence of crypto mining on its soil. WeChat bans crypto payments A rough translation of the Payment Service Protocol found on weixin.qq.com indicates that the ban is a result of changes regarding payment management and measures to ensure “the prevention of illegal telecommunications …

Major global crypto exchange Huobi has launched a regulated over-the-counter (OTC) trading desk for institutional investors, according to a blog post on May 15. The new OTC crypto trading platform, Huobi OTC Desk, is fully regulated by the Gibraltar Financial Services Commission (FSC), and enables major fiat-to-crypto and crypto-to-crypto trading pairs. Unlike the existing Huobi’s OTC retail products, the new OTC trading desk enables a principal OTC trading process under Huobi Technology, Huobi’s regulated OTC trading entity in Gibraltar, while the existing OTC offering on otc.hbg.com enables peer-to-peer (P2P) tradings under Huobi Global, the firm clarified. Jeff Adams, Senior Sales …

United States $7 trillion investment firm Fidelity will reportedly roll out bitcoin (BTC) trading for institutional clients in the coming weeks, Bloomberg reported on May 6. Citing a source who asked to remain anonymous, the publication revealed Fidelity’s cryptocurrency-focused spin-off, Fidelity Digital Assets, would be adding to the existing range of services. The subsidiary launched in October 2018 and has offered cryptocurrency custody from March this year ahead of planned over-the-counter (OTC) trading. Now, the trading side will go live for Fidelity’s users in as little as several weeks, the source said, and will primarily target large-volume traders like other …