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Morgan Stanley now clearing Bitcoin Futures as well

Jan 20, 2018 Posted /  3056 Views

Morgan Stanley now clearing Bitcoin Futures as well

The Wall Street firms are now taking the command in their hands for Bitcoin Futures Contract as Morgan Stanley now joins Goldman Sachs Group Inc. in the clearance of the contract. Morgan Stanley has started to certain the Bitcoin Futures contract for large institutional clients and there had been a regular meeting of executives in the company pertaining to how they can engage with cryptocurrencies. The Chief Financial Officer Jonathan Pruzan told the Bloomberg on Tuesday-

“If someone wants to do a trade on the futures and settle in cash, we’ll do that,”

He further added

“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.”

Before it, Goldman Sachman Group Inc. was the only major Wall Street company to offer this service to its clients. It is noteworthy that when CBOE launched the futures contract for Bitcoin, it opened the doors for the digital currency to enter the mainstream realm of more regulated finance. This launch was followed by the CME group also offering its Bitcoin Futures. Now the 17th January 2018 was the month expiration of the CBOE’s contract. Nonetheless, Goldman Sachs has demanded some clients to set aside funds equivalent to the full value of their Bitcoin futures trade as a condition for clearing the transaction, dissuading some customers in December (as reported by Bloomberg).

Pruzan refused to comment on how much was made compulsory by Morgan Stanley but he remarked that the volatility of an asset class is one aspect of setting margin levels. While he says that executives have been “monitoring very closely” he added that the company has not yet decided to whether or not they will get engaged in market making or custody of cryptocurrencies.

There have been clear indications that institutional investors may be beginning to participate more and have a much superior role in the Bitcoin markets. Nonetheless, this is considered significant and they will have a pertinent role to play as such institutions if become interested in acquiring Bitcoin, the price will certainly surge. Certainly, Coinbase is doing the same with such clients as Coinbase CEO Brian Armstrong proposes that institutional investors are even ready to invest as much as $10 bln.

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Tags: Bitcoin Futures Morgan Stanley CBOE

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