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Top inter-dealer broker TP ICAP launches crypto ETPs



Top inter-dealer broker TP ICAP launches crypto ETPs

The world’s biggest inter-dealer broker TP ICAP has just completed its first trade on crypto asset equity instruments with multinational investment bank, Goldman Sachs.

The crypto space has gained astronomical traction in the recent years among investors as an important tool of investment. This has boosted the rising popularity of exchange-traded funds, more specifically exchange traded products (ETPs), which includes the existing crypto products.

On January 10, leading provider of market infrastructure, TP ICAP, announced that it has launched a range of crypto-related exchange-traded products (ETP) for its European clients.  The platform traded the ETC Group Physical Bitcoin, a physically backed equity instrument, which is traded on Xetra, against the CME Bitcoin Future. Additionally, leading crypto Exchange Traded Products market makers- DRW, Flow Traders and Jane Street provided liquidity.

What are ETPs?

ETPs allow firms to gain exposure to parts of the crypto universe without investing directly. Most crypto asset ETPs give investors institutional-grade trading and custody services, addressing investor concerns such as hacking of the private keys, or not being able to access liquidity across various crypto exchanges. Most importantly, crypto ETPs can seamlessly plug in to existing trading and brokerage platforms. 

TP ICAP Group acts as an intermediary between sophisticated market participants who are seeking to buy and sell financial products in markets where there are no centralized exchanges or market makers, such as over-the-counter or bond markets.

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Future of ETPs

Simon Forster, Co-Head of TP ICAP Digital Assets, said that the company is delighted to start providing liquidity for clients in these European crypto asset equity instruments alongside Goldman Sachs. The company is also looking forward to add more equity instruments and provide crypto asset ETFs in the United States of America very soon. Forster went on to add,

We have seen increasing interest in crypto assets products this year as it continues to mature and institutionalize as an asset class. We expect to see more growth and more demand for these kinds of products in 2022.”

As per the official report, TP ICAP, is also planning to launch a over-the-counter (OTC) derivative products based on digital assets in the near future.  An OTC derivative is a financial contract that is arranged off exchange, such as a swap. This is not the first time the broker has tried its hands in the crypto space. TP ICAP has had a crypto working group since 2017 and provided liquidity to its clients on CME crypto products in 2019.