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SBI Holdings All Set To Roll Cryptocurrency Derivatives Market

SBI Holdings is all set to make another notable entry into the cryptocurrency market. A certain unit of SBI Holdings has started working towards a cryptocurrency derivatives trading market. It is being considered to be a remarkable move. If successful, this could open many doors for the cryptocurrency backers who long for higher liquidity and heterogenous trading options.

On July 30, SBI Crypto Investment, a division of SBI Holdings bought a 12% share in Clear Markets. Clear Markets is a trading company focussing on electronic transactions. The exact figures of the deal are yet to be divulged but it is being valued at approximately $9 million.

Based in Charlotte-North Carolina, Clear Markets has been dealing with controlling and developing not only electronic marketplaces but also trading technologies. With this deal, SBI Crypto Investment is looking forward to develop a derivatives trading platform in order to lure in institutional investors to the market.

In today’s market, there is absolutely no doubt of the fact that cryptocurrencies are amongst one of the highly sought after asset classes. But their unpredictable nature acts as a striking disincentive preventing its ubiquitous adaptation. The swings of Bitcoin in June and July 2018 where it declined 30% only to gain 30%  is a testament to their volatile nature.

With the omnipresent volatile price flutters, the formation of a cryptocurrency-based derivatives market is a boon. However, this area mostly remains underdeveloped and hence not allowing the big investors to restrict their risk. However, despite their rendezvous with Clear Markets, it is a little difficult for SBI to develop a platform which allows hedge funds, family offices and other investors to trade the cryptocurrency instruments easily.

SBI has been exploring and investing in the cryptocurrency market heavily. It has already made some notable investments in the market with its stakes in Bitflyer and CoolBitX. Bitflyer is a cryptocurrency exchange platform whereas CoolBitX is a wallet developer. Apart from these, it also owns SBI Virtual Currencies, which is also a cryptocurrency exchange platform

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