Published: Mon, July 09, 2018
Economy | By

Europe's Top Speed Trading Firm Flow Traders Join the Crypto-Economy

Europe's Top Speed Trading Firm Flow Traders Join the Crypto-Economy

In what could potentially be hugely significant for the future of institutional investment in crypto, Bloomberg reports that Flow Traders has become the first trading firm in the world to publicly acknowledge that it is actively trading crypto ETNs on regulated exchanges.

On its part, the Dutch Authority for the Financial Market has remained strongly opposed to crypto, releasing a statement where it described it as "prone to abuse" and "not an asset class".

USA traders have already started making markets, but Flow Traders is the first to publicly announce that it is buying and selling crypto notes on normal stock exchanges. The company's move into crypto has already made a significant impact on the fledgling market for crypto notes, with XBT Provider, an issuer of crypto ETNs listed in Sweden, reporting that the Dutch company has "dramatically increased" trading of its securities in the last few months.

By becoming the first company to trade a cryptocurrency-backed ETN, Flow Traders seems to be setting a standard that bridges both the mainstream and virtual currency finance industries.

Dijkstra explained in an interview, "People underestimate crypto, It's big, and it is to be regulated very soon". The market participants are much more professional than people think. "Given its inability to serve the promised goal as a currency, we don't regard it to be an asset class", said Torensma. He stated that the new approach has "great indirect benefits" for the development of Flow Traders NV's foreign exchange trading business.

However, Flow Traders have sought to overlook these austere warnings by the government and engage in bitcoin in particular and cryptocurrencies in particular.

Flow Traders will try to hedge every trade it executes, as quickly as possible. The institutional investors are drawn, and he knows for sure since they get requests.

One of the largest and most important traders of exchange-traded funds in Europe is moving into cryptocurrencies. This prompted the company to start looking into new asset classes.

The plan thus far for Flow Traders is to hedge ETN along with CME or CBOE in terms of futures contracts and will also lower the sluggishness due to an increase in liquidity.

The five big USA speed traders are already into crypto markets and they are also exploring the possibilities in cryptocurrency futures and underlying currencies.

Flow Traders suspect that the volatility and the irregular categorisation of bitcoin to add a layer of risk to its ETNs.

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