Chicago, New York, Stuttgart, Valletta, Kingston, Berlin... Institutional investors Pussyfoot Around

Traditional trading platforms are loyal to cryptocurrencies, but they prefer not to make much of it. What is the reason? Maybe in the uncertainty of regulators? Or in fear of shaking the confidence of large fiat investors with their adventurism? There can be many answers. In any case, the crypto is entering the big financial market" on soft paws".

The most noticeable recent event in the sphere of interaction between exchanges and the cryptocurrency market was the announcement of the Jamaica Stock Exchange (JSE) that it had agreed with the Canadian fintech company Blockstation on cooperation for the proposed crypto assets trade. Jamaican traders are very hopeful that after the agreement of all the formalities, the exchange will be able to provide daily quotes and settlement tools for customers wishing to take part in crypto exchange trades. The Canadian company, in turn, said that it had already conducted a beta test of its platform, the results of which pleased software developers and stockbrokers.

There is little left to do –to put the plan into action. JSE head Marlin STREET FOREST said: "We are moving forward comfortably, basing ourselves on training and support". However, this promotion cannot be called rapid. According to the results of all the negotiations and tests, only the “Memorandum of Understanding” (MOU) has been signed - in general, a non-committal document that reflects only the expectation of the parties from each other and no more.

Jamaica is not the only country where stock exchanges have stated a willingness to work with crypto assets. In Germany, the second-largest stock exchange platform Stuttgart Börs expressed interest in the crypto market. The Stock Exchange of Malta (MSE) announced the start of a teamwork to create a unified trading space with OKEx's crypto exchange. The result of their cooperation should be the safe and controlled trading platform OKMSX. And again in the future.

Earlier, the American exchange Nasdaq had announced the support of three cryptocurrencies: Litecoin, Stellar and Bitcoin. And now crypto notes appeared in the American market (ETN) - exchange instruments tied to the cost of the cryptocurrencies and going in tandem with the dollar. This product has one drawback: the commission for its maintenance is 2.5% per year, unlike ETF, which costs the investor no more than 0.21%. There are ETNs, but the cryptocurrencies themselves are not available on the stock exchange yet. It is only planned. The Chicago Stock Exchange started trading futures for the crypto, but there is no information about the volume and intensity of the trades.

If we look at the situation without prejudice, then there is practically no real drawing together between the crypto and the fiat market: only hopes, aspirations, intentions, and promises. But for all 10 years, the cryptocurrency has existed, not a single significant exchange project on crypto assets ever happened. Of course, everyone in the US market is waiting for SEC signals, but this is just a part of the problem.

The “reverse side of the medal” is the following: in order for the crypto to be traded, a fundamental restructuring of the trading methodology and the psychology of traders is necessary on the exchange. The crypto market is much faster, bolder and more aggressive than the classical one. Blockchain Capital partner Spencer BOGART noted that "the trajectory of the cryptocurrency market is obvious: institutional support will grow, as well as the number of developers representing solutions on the blockchain”.

"However, - he said, - retail investors (mainly working on crypto exchanges - ed. note) always take more harsh decisions than institutional ones. Thus we observe the high volatility of digital tokens. Because of this, we have to rise higher at the maximum point and fall lower at the minimum point".     

Consequently, we can assume that if tomorrow digital tokens appear on some currency or stock exchange, the current investors will simply not work with them - they are too rapid and extreme for the clear and time-tested rules.

Hunter HORSLEY, director of Bitwise Asset Management, unequivocally spoke about the massive adoption of cryptocurrencies. In his opinion, this will take at least 5-10 years, and mentioned the Internet as an example. It took more than two decades for the Internet to become what it is now known to us.

For the new generation currencies, a new generation of investors and traders is needed. Those who are not afraid of either volatility or value uncertainty, but will be able to turn them to their advantage. In the meantime, major players in the financial market will be limited to the statements of purpose.  So simple, without consequences. “Not to lose the trend". If the cryptocurrency itself will survive these 5-10 years, it is unknown.