According to Financial Times, US banking giant State Street intends to join the cryptocurrency trading business this year.
This second-oldest bank in the United States, with $3.1 trillion in assets, is establishing the platform for a new bank-grade trading network involving digital assets scheduled to launch later this year — which can potentially use the platform for trading itself.
State Street’s trading site Currenex, which was knowingly placed up for sale last year, has teamed up with London-based Puremarkets Ltd (Pure Digital) to create a multi-custodial crypto trading platform, Puremarkets announced today, adding that the partners “plan to further pursue the digital currency trading market.”
“Currenex is thrilled to leverage our experience and expertise in the FX and digital asset trading marketplace to provide Pure Digital with robust technology and infrastructure for this exciting digital currency trading initiative,”
David Newns, Head of Execution Services for State Street Global Markets
“It would be the first of its type, a retail trading network that gives wholesale Tier 1 investment banks the ability to exchange digital assets. Pure Digital is in negotiations with many other Tier 1 investment banks about the platform’s use. The platform would include a high-throughput OTC market for digital assets and cryptocurrency, along with inventory management and bank custody,” Arcane Crypto, a Norwegian crypto firm, stated in a separate announcement. This firm indirectly holds 37.5% of Puremarkets.
Campbell Adams, the founder of Pure Digital, said, “It necessitates the involvement of large-balance financial entities in the price manufacturing process. The primary market does not occur in fact. There are several disparate interactions taking place, each with its own set of rules of interaction and system. And this is reflected in extremely fragmented industry results.”
State Street had USD 3.47 trillion in assets under management at the end of 2020, an increase of 11% from the previous year. However, sales fell by 4% to 2.9 billion, and net profits fell by 5% to USD 537 million.
Lauren Kiley, CEO of Pure Digital, remarked, “Many of these banks are now aware of crypto and are unable to avoid it any longer. If they find a way to participate and offer resources in response to customer demand, or they will gradually lose relevance.”