Deutsche Börse AG is a joint stock company which is also a marketplace organizer for the trading of both shares and other securities. Also, it provides transaction services as well as giving companies and investors access to global capital markets. Deutsche Börse AG which operates the Frankfurt Stock Exchange parent company is thinking about offering Bitcoin and Cryptocurrency- related products to their clients.
The Frankfurt Stock Exchange is the largest of the German’s seven stock exchanges with a share in turnover of around 90 percent. Not only is it considered the largest of the German’s seven stock exchanges but also one of the 10 world’s largest trading centers for securities. Today, the Frankfurt Stock Exchange is an international trading center as this is reflected in the structure of its participants. Recently, the company made its intention known to release cryptocurrency trading app. Today, they have hinted that they are working to introduce cryptocurrency and Bitcoin-related products to their clients.
The Inside Story
Jeffrey Tessler, the firm’s head of clients, core markets and products for Deutsche Börse, said at an event hosted by the Association for Financial Markets in Europe on May 23, 2018, that, “We are deep at work with it,” Bloomberg reports.
Tessler says Deutsche Börse is trying to understand the crypto- space first and then be able to analyze things which will help make necessary projections as well as see where it stands in the eyes of European regulators. This statement is confirmed with Bloomberg quoting Tessler as saying:
“Before we move forward with anything like bitcoin we want to make sure we understand the underlying transaction which isn’t the easiest thing to do.”
Both CBOE Global Markets and CME Group launched bitcoin future trading last December. Though Jeffery Tessler confirmed their possibility of offering Bitcoin and Cryptocurrency- related products, he is quoted in Bloomberg confirming that Deutsche Börse is “not at the same stage” as CME and CBOE.
Although there is a bit of uncertainty in their move into offering bitcoin products, the exchange has however been active in the blockchain space.
In June 2017, Deutsche Börse showed details to CoinDesk about its plan to shift most of its post-trade services to the blockchain. However, at that time it was more focused on creating a system with Hyperledger’s open-source Fabric protocol in transferring securities and moving commercial bank money while still ensuring a cross-jurisdictional compliance with regulators.
Deutsche Börse seeking to implement a system that can offer a more effective securities settlement through a blockchain announced a plan to work with the financial management firm HQLAX as well as R3’s Corda blockchain platform which was two months ago.
Moreover, R3 and HQLAX have unraveled the problem associated with securities lending with a number of large banks such as the Credit Suisse and ING and this act proves their credibility in helping Deutsche Börse’s implementation of the system.
Jeffery Tessler also added that the firm is trying to comprehend the volatility of the Bitcoin market and making sure that the clients are “in line” as well as making sure regulators are in line before moving forward with anything like Bitcoin and its offerings.
Other Stock Exchanges Planning a Bitcoin Exchange.
A report by New York Times (NYT) revealed that an Intercontinental Exchange, (ICE), the parent company of the New York Stock Exchange (NYSE), wants to set up its own Cryptocurrency exchange. On May 7, 2018, the NYT made their first report on the developments after having four individuals make known the plans and related emails to the newspaper.
The Intercontinental Exchange has been reported to have been in contact with financial institutions and legacy banks to help speed swap contracts for potential Bitcoin trading.
Despite the current fluctuations occurring in Bitcoin, will the Frankfurt Stock Exchange and the ICE still consider offering Bitcoin products to its clients as well as trading in Bitcoin respectively?
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