Collaboration positions NUS as the first university in Singapore to implement blockchain technology for ESG reporting ...

Northern Trust and NUS Forge Partnership to Advance Green Finance Innovation - MarketScreener

Beyond analysts&#x27; top -and-bottom-line estimates for Northern Trust (NTRS), evaluate projections for some of its key metrics to gain a better insight into how the business might have performed for the quarter ended March 2024.

Unlocking Q1 Potential of Northern Trust (NTRS): Exploring Wall Street Estimates for Key Metrics - April 11, 2024 - Zacks.com

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Northern Trust Corp. stock underperforms Wednesday when compared to 
competitors

West Virginia&#x27;s treasurer says the state will no longer bank with four financial firms, including Citi and Northern Trust.

West Virginia stops banking with Citi, Northern Trust, over fossil fuels

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Northern Trust Reveals ‘Secrets of Enterprising Families’

Northern Trust (NTRS) possesses the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

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NGS Super is ahead of schedule to achieve 35% less emissions by 2025 and a carbon-neutral portfolio by 2030 · The House Financial Services Committee advanced four bills along party lines aimed at combating the influence of ESG investing in financial markets

West Virginia bars Northern Trust, Citi from banking contracts over oil

State Treasurer Riley Moore says banks &#x27;boycott&#x27; fossil fuels industry · Author of the article:

West Virginia bars TD, HSBC, Citi, Northern Trust over ESG policies | Financial Post

Northern Trust Corp. stock outperforms competitors on strong trading day

For more than 130 years, Northern Trust has earned distinction as an industry leader for exceptional service, financial expertise, integrity and innovation. Visit us on <strong>northerntrust</strong>.com. Follow us on X (formerly Twitter) @<strong>NorthernTrust</strong> or Northern Trust Corporation on LinkedIn.

Northern Trust Strengthens Atlanta Wealth Management Team

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Effective trading mechanisms are crucial to DeFi, as without them, the entire ecosystem would struggle to operate efficiently and attract users, ultimately limiting its growth and impact. Currently, DeFi primarily relies on Automated Market Makers (AMMs), while Central Limit Order Books (CLOBs) are emerging as an alternative. Automated Market Makers (AMMs) revolutionized DeFi asset trading by enabling straightforward swaps without the need for traditional order books. Their user-friendly approach has made AMMs the dominant trading method in DeFi, allowing users to trade directly from their wallets without needing to navigate complex order types. However, a new mechanism is gaining traction across DeFi: Central Limit Order Books (CLOBs). While CLOBs have long been a staple in traditional finance, their adoption in DeFi is still in its early stages. CLOBs require high transaction throughput and low latency to match and execute orders efficiently, which poses a challenge for most blockchains—especially Ethereum—before the advent of rollups and sharding. As blockchain scalability improves, L2 solutions like Fuel are making CLOBs a viable option, by allowing developers to build smart contracts that require high performance virtual machines to be efficient. The emergence of DeFi based CLOBS signals that the DeFi sector is maturing and positioning itself for a wave of institutional engagement. Additionally, the integration of both AMMs and CLOBs can help create a robust DeFi ecosystem that accommodates a diverse user base, leveraging the strengths of each to meet varying trading needs. How do Automated Market Makers (AMMs) work? AMMs use an algorithm to price assets based on the constant product formula and its derivatives, the most popular being, x*y=k. AMMs enable traders to exchange assets directly from liquidity pools without requiring a counterparty, unlike traditional order books. Instead, on AMMs traders trade against the liquidity of passive liquidity providers who earn fees for providing liquidity to the protocol. This approach has been revolutionary in DeFi, allowing anyone to provide liquidity and participate in trading without needing to be a professional trader or quant. How do Central Limit Order Books (CLOBs) work? CLOBs facilitate efficient and transparent trading by matching buy and sell orders based on price and time priority. Traders submit various types of orders, including market, limit, and stop orders. CLOBs continuously update to reflect current market conditions, showing outstanding buy and sell orders and providing insights into market depth. For instance, if a trader wants to buy 1 Bitcoin at $60,000, they submit  a limit order to  the CLOB. If a seller is willing to sell 1 Bitcoin at $60,000, the two orders can be  matched, and the trade is executed. If no seller is available at that price, the order remains in the book until a matching seller is found. The  speed and precision of CLOBs make them ideal for high-frequency and algorithmic trading, attracting professional traders and institutional investors by offering greater flexibility and control. Key Differences Between CLOBs and AMMs Feature

Automated Market Makers (AMMs)

Central Limit Order Books (CLOBs)



Mechanism

Algorithmic pricing based on the constant product formula (x*y=k)

Order matching based on price-time priority



Users

Suitable for both casual and advanced users; offers customizable strategies, especially with advancements like UniV4.

Favoured by professional traders for precise control but also adaptable for various user levels depending on the platform.



Order Types

Simple swaps, no advanced order types

Advanced order types like limit orders, stop orders, and conditional orders



Capital Efficiency

Capital inefficient due to most liquidity sitting idle along the bonding curve

More capital efficient, matching buyers and sellers directly,



Trading Strategies

Supports both basic and advanced trading strategies with customizable liquidity provision in UniV4.

Supports sophisticated trading strategies and high-frequency trading



User Expertise

Easy to use, typically features simpler UI

Requires more expertise, designed for advanced trading capabilities



Decentralization

Completely decentralized, governed by smart contracts

Can be decentralized but typically involves a more complex architecture



Advanced Features

Supports advanced features like buy/sell limit orders and customizable liquidity provision, especially with UniV4

Offers better price discovery and enhanced order types, reducing arbitrage opportunities and benefiting from more precise market equilibrium Why Will CLOBs Play an Important Role in the Next Phase of DeFi? The next wave of DeFi growth is expected to be driven by increasing institutional investment and interest. According to Northern Trust, financial institutions are preparing for significant adoption of digital assets and tokenization, which is expected to accelerate institutional DeFi over the next few years. Additionally, industry experts predict substantial growth in DeFi due to the tokenization of real-world assets, further attracting institutional investors. Binance Research notes that the total value locked (TVL) in DeFi has surged by 75.1% year-to-date, reaching $94.9 billion, with significant capital inflows. It also highlights that yield-bearing assets saw a 148.6% increase, now making up $9.1 billion of the TVL. This influx of capital has benefited nearly every DeFi sector, making previously inaccessible financial primitives available on chain. To accommodate this shift, DeFi must evolve beyond the limitations of AMMs, which are well-suited for everyday users, and develop infrastructure that meets the demands of more sophisticated traders. This is where CLOBs have the potential to become a game-changer for DeFi, offering advanced trading capabilities, superior price discovery, and improved capital efficiency to support the needs of institutional participants. Effective trading mechanisms are crucial to DeFi, as without them, the entire ecosystem would struggle to operate efficiently and attract users, ultimately limiting its growth and impact. Currently, DeFi primarily relies on Automated Market Makers (AMMs), while Central Limit Order Books (CLOBs) are emerging as an alternative. Automated Market Makers (AMMs) revolutionized DeFi asset trading by enabling straightforward swaps without the need for traditional order books. Their user-friendly approach has made AMMs the dominant trading method in DeFi, allowing users to trade directly from their wallets without needing to navigate complex order types. However, a new mechanism is gaining traction across DeFi: Central Limit Order Books (CLOBs). While CLOBs have long been a staple in traditional finance, their adoption in DeFi is still in its early stages. CLOBs require high transaction throughput and low latency to match and execute orders efficiently, which poses a challenge for most blockchains—especially Ethereum—before the advent of rollups and sharding. As blockchain scalability improves, L2 solutions like Fuel are making CLOBs a viable option, by allowing developers to build smart contracts that require high performance virtual machines to be efficient. The emergence of DeFi based CLOBS signals that the DeFi sector is maturing and positioning itself for a wave of institutional engagement. Additionally, the integration of both AMMs and CLOBs can help create a robust DeFi ecosystem that accommodates a diverse user base, leveraging the strengths of each to meet varying trading needs. How do Automated Market Makers (AMMs) work? How do Automated Market Makers (AMMs) work? AMMs use an algorithm to price assets based on the constant product formula and its derivatives, the most popular being, x*y=k. AMMs enable traders to exchange assets directly from liquidity pools without requiring a counterparty, unlike traditional order books. Instead, on AMMs traders trade against the liquidity of passive liquidity providers who earn fees for providing liquidity to the protocol. This approach has been revolutionary in DeFi, allowing anyone to provide liquidity and participate in trading without needing to be a professional trader or quant. How do Central Limit Order Books (CLOBs) work? How do Central Limit Order Books (CLOBs) work? CLOBs facilitate efficient and transparent trading by matching buy and sell orders based on price and time priority. Traders submit various types of orders, including market, limit, and stop orders. CLOBs continuously update to reflect current market conditions, showing outstanding buy and sell orders and providing insights into market depth. For instance, if a trader wants to buy 1 Bitcoin at $60,000, they submit  a limit order to  the CLOB. If a seller is willing to sell 1 Bitcoin at $60,000, the two orders can be  matched, and the trade is executed. If no seller is available at that price, the order remains in the book until a matching seller is found. The  speed and precision of CLOBs make them ideal for high-frequency and algorithmic trading, attracting professional traders and institutional investors by offering greater flexibility and control. Key Differences Between CLOBs and AMMs Key Differences Between CLOBs and AMMs Feature

Automated Market Makers (AMMs)

Central Limit Order Books (CLOBs)



Mechanism

Algorithmic pricing based on the constant product formula (x*y=k)

Order matching based on price-time priority



Users

Suitable for both casual and advanced users; offers customizable strategies, especially with advancements like UniV4.

Favoured by professional traders for precise control but also adaptable for various user levels depending on the platform.



Order Types

Simple swaps, no advanced order types

Advanced order types like limit orders, stop orders, and conditional orders



Capital Efficiency

Capital inefficient due to most liquidity sitting idle along the bonding curve

More capital efficient, matching buyers and sellers directly,



Trading Strategies

Supports both basic and advanced trading strategies with customizable liquidity provision in UniV4.

Supports sophisticated trading strategies and high-frequency trading



User Expertise

Easy to use, typically features simpler UI

Requires more expertise, designed for advanced trading capabilities



Decentralization

Completely decentralized, governed by smart contracts

Can be decentralized but typically involves a more complex architecture



Advanced Features

Supports advanced features like buy/sell limit orders and customizable liquidity provision, especially with UniV4

Offers better price discovery and enhanced order types, reducing arbitrage opportunities and benefiting from more precise market equilibrium Feature

Automated Market Makers (AMMs)

Central Limit Order Books (CLOBs) Mechanism

Algorithmic pricing based on the constant product formula (x*y=k)

Order matching based on price-time priority Users

Suitable for both casual and advanced users; offers customizable strategies, especially with advancements like UniV4.

Favoured by professional traders for precise control but also adaptable for various user levels depending on the platform. Order Types

Simple swaps, no advanced order types

Advanced order types like limit orders, stop orders, and conditional orders Capital Efficiency

Capital inefficient due to most liquidity sitting idle along the bonding curve

More capital efficient, matching buyers and sellers directly, Trading Strategies

Supports both basic and advanced trading strategies with customizable liquidity provision in UniV4.

Supports sophisticated trading strategies and high-frequency trading User Expertise

Easy to use, typically features simpler UI

Requires more expertise, designed for advanced trading capabilities Decentralization

Completely decentralized, governed by smart contracts

Can be decentralized but typically involves a more complex architecture Advanced Features

Supports advanced features like buy/sell limit orders and customizable liquidity provision, especially with UniV4

Offers better price discovery and enhanced order types, reducing arbitrage opportunities and benefiting from more precise market equilibrium Feature Automated Market Makers (AMMs) Central Limit Order Books (CLOBs) Feature Feature Feature Automated Market Makers (AMMs) Automated Market Makers (AMMs) Automated Market Makers (AMMs) Central Limit Order Books (CLOBs) Central Limit Order Books (CLOBs) Central Limit Order Books (CLOBs) Mechanism Algorithmic pricing based on the constant product formula (x*y=k) Order matching based on price-time priority Mechanism Mechanism Mechanism Algorithmic pricing based on the constant product formula (x*y=k) Algorithmic pricing based on the constant product formula (x*y=k) Order matching based on price-time priority Order matching based on price-time priority Users Suitable for both casual and advanced users; offers customizable strategies, especially with advancements like UniV4. Favoured by professional traders for precise control but also adaptable for various user levels depending on the platform. Users Users Users Suitable for both casual and advanced users; offers customizable strategies, especially with advancements like UniV4. Suitable for both casual and advanced users; offers customizable strategies, especially with advancements like UniV4. Favoured by professional traders for precise control but also adaptable for various user levels depending on the platform. Favoured by professional traders for precise control but also adaptable for various user levels depending on the platform. Order Types Simple swaps, no advanced order types Advanced order types like limit orders, stop orders, and conditional orders Order Types Order Types Order Types Simple swaps, no advanced order types Simple swaps, no advanced order types Advanced order types like limit orders, stop orders, and conditional orders Advanced order types like limit orders, stop orders, and conditional orders Capital Efficiency Capital inefficient due to most liquidity sitting idle along the bonding curve More capital efficient, matching buyers and sellers directly, Capital Efficiency Capital Efficiency Capital Efficiency Capital inefficient due to most liquidity sitting idle along the bonding curve Capital inefficient due to most liquidity sitting idle along the bonding curve More capital efficient, matching buyers and sellers directly, More capital efficient, matching buyers and sellers directly, Trading Strategies Supports both basic and advanced trading strategies with customizable liquidity provision in UniV4. Supports sophisticated trading strategies and high-frequency trading Trading Strategies Trading Strategies Trading Strategies Supports both basic and advanced trading strategies with customizable liquidity provision in UniV4. Supports both basic and advanced trading strategies with customizable liquidity provision in UniV4. Supports sophisticated trading strategies and high-frequency trading Supports sophisticated trading strategies and high-frequency trading User Expertise Easy to use, typically features simpler UI Requires more expertise, designed for advanced trading capabilities User Expertise User Expertise User Expertise Easy to use, typically features simpler UI Easy to use, typically features simpler UI Requires more expertise, designed for advanced trading capabilities Requires more expertise, designed for advanced trading capabilities Decentralization Completely decentralized, governed by smart contracts Can be decentralized but typically involves a more complex architecture Decentralization Decentralization Decentralization Completely decentralized, governed by smart contracts Completely decentralized, governed by smart contracts Can be decentralized but typically involves a more complex architecture Can be decentralized but typically involves a more complex architecture Advanced Features Supports advanced features like buy/sell limit orders and customizable liquidity provision, especially with UniV4 Offers better price discovery and enhanced order types, reducing arbitrage opportunities and benefiting from more precise market equilibrium Advanced Features Advanced Features Advanced Features Supports advanced features like buy/sell limit orders and customizable liquidity provision, especially with UniV4 Supports advanced features like buy/sell limit orders and customizable liquidity provision, especially with UniV4 Offers better price discovery and enhanced order types, reducing arbitrage opportunities and benefiting from more precise market equilibrium Offers better price discovery and enhanced order types, reducing arbitrage opportunities and benefiting from more precise market equilibrium Why Will CLOBs Play an Important Role in the Next Phase of DeFi? Why Will CLOBs Play an Important Role in the Next Phase of DeFi? The next wave of DeFi growth is expected to be driven by increasing institutional investment and interest. According to Northern Trust , financial institutions are preparing for significant adoption of digital assets and tokenization, which is expected to accelerate institutional DeFi over the next few years. Additionally, industry experts predict substantial growth in DeFi due to the tokenization of real-world assets, further attracting institutional investors. Binance Research notes that the total value locked (TVL) in DeFi has surged by 75.1% year-to-date, reaching $94.9 billion, with significant capital inflows. It also highlights that yield-bearing assets saw a 148.6% increase, now making up $9.1 billion of the TVL. This influx of capital has benefited nearly every DeFi sector, making previously inaccessible financial primitives available on chain. Northern Trust Northern Trust industry experts predict substantial growth in DeFi industry experts predict substantial growth in DeFi Binance Research Binance Research To accommodate this shift, DeFi must evolve beyond the limitations of AMMs, which are well-suited for everyday users, and develop infrastructure that meets the demands of more sophisticated traders. This is where CLOBs have the potential to become a game-changer for DeFi, offering advanced trading capabilities, superior price discovery, and improved capital efficiency to support the needs of institutional participants.

The Maturity of DeFi Requires a Shift from Automated Market Makers to Central Limit Order Books

, the leading financial media company for next-generation investors, is excited to announce a robust lineup of speakers that includes the world’s top investors, founders and entrepreneurs for its annual Nov. 14 in New York City. Benzinga Future of Digital Assets Conference This must-attend event promises to be the largest gathering of digital asset companies and institutional investors, offering a year's worth of networking opportunities in one day. Forge partnerships and build winning investment strategies. This event is where global power players, Wall Street money managers and blockchain visionaries meet and manifest a dynamic, future-forward Web3 marketplace. The Future Of Digital Assets conference will be preceded by the Nov. 13. Both events will be held at Convene at 225 Liberty St. in Manhattan. Benzinga Fintech Deal Day & Awards “We're gearing up for a monumental event this November. The lineup is unmatched, and we will truly be charting the course for how Wall Street and digital assets work with and against each other,” says Luke Jacobi, president of Benzinga. Benzinga’s impressive roster of speakers continues to grow daily. Some highlights include: Brett Harrison, Founder, CEO, Architect Richard Widmann, Head of Strategy Web3, Google Cloud Luca Netz, CEO, Pudgy Penguins Caitlin Long, Founder, CEO, Custodia Bank Mark Yusko, CEO, Chief Investment Officer, Morgan Creek Capital Management Keith Grossman, President of Enterprise, MoonPay Gracy Chen, Managing Director, Bitget David Palmer, Chief Product Officer, Vodafone Brooke Stoddard, VP, Client Team, Grayscale Investments Alex Salnikov, Co-Founder, Chief Strategy Officer, Rarible Abhishek Saxena, Investment Principal, Polygon Ventures Bobby Zagotta, CEO, Bitstamp USA, Global Commercial Officer, Bitstamp USA To see the full agenda with speakers, go here. Organizations sending speakers to this year's events include BlackRock, BNY Mellon, DTCC, OCC, State Street, Société Générale, Hedera, Citi, BMO, Dow Jones, Northern Trust, Franklin Templeton, Amazon, S&P Global, VanEck, Google, Fireblocks, Invesco, Moody’s, and EDX Markets, to name a few. The countdown to the Future of Digital Assets event has begun! With limited spaces remaining, now is the time to secure your spot and be part of a groundbreaking experience that promises networking, learning, and insights into the evolving world of digital assets. Register here. For more information, visit the . Future of Digital Assets event page Benzinga’s Fintech Deal Day & Awards | November 13, 2023 | Convene in NYC Use code HACKERNOON20 for 20% off tickets. . Get tickets here About Benzinga Benzinga is a leading content provider to global brokerages and media outlets, including Yahoo, MarketWatch, and Insider. Benzinga delivers high-quality, low-cost, and timely content directly to users through newswires, analytics software, and other data services. In addition to its core product portfolio, Benzinga hosts thought leadership, networking, and educational events to assist investors, founders, and operators in the next stage of their growth.

Build Wealth In Alternative Investments at Benzinga’s Future of Digital Assets Conference

, a financial media company, is gearing up to honor innovation in the financial services sector. Its flagship conferences, including the and , will kick off at New York City’s on November 13. Benzinga Fintech Deal Day & Awards Future of Digital Assets Convene 225 The two days of events will bring together 1,000 founders, operators, and investors to share the latest trends and opportunities in fintech and digital assets. Confirmed speakers include leading executives from industry titans such as BlackRock, DTCC, OCC, State Street, Société Générale, Hedera, Citi, BMO Capital Markets, Northern Trust, Citibank, Amazon, S&P Global, Google, Fireblocks, Invesco, and Moody’s. “This is where the future of fintech will be shaped,” Benzinga Founder, CEO Jason Raznick said. “If you're not here, you're likely to miss out on upwards of $100 million in deals made. This is where deals get done.” Other reasons to not miss Benzinga’s Fintech Deal Day & Awards include: Executive Access: Engage with executives at top-tier companies like Robinhood and State Street through rapid-fire discussions and speed networking. Keynote Surprise: Meet celebrity “shark” investor Kevin O’Leary, from ABC Network’s Shark Tank. O’Leary will offer sharp insight into the world of fintech investing, as well as his candid thoughts. Benzinga Connect: Ideate and deal with over 1,000 founders, operators, and investors attending with Benzinga’s networking app. Receive key updates, book 1:1 meetings, and review the agenda, speakers, sponsors, and participating companies. Innovation Showcase: Stroll the exhibit halls for live demos and presentations before joining attendees in the afternoon to celebrate innovators who have made a significant contribution to the trajectory of the fintech industry. A limited number of tickets remain available; the clock is ticking, and seats are filling up fast. This is the one event in 2023 that you can't afford to miss. Secure a spot and be a part of the thought leadership that guides tomorrow's innovation in financial services. Book Now! Benzinga’s Fintech Deal Day & Awards | November 13, 2023 | Convene in NYC Use code HACKERNOON20 for 20% off tickets. . Get tickets here

Benzinga Kick Off Flagship Conferences Recognizing and Fueling Innovation In Finance

The digital asset space has long heralded the unavailability of institution-grade crypto custodial services. This is one of the factors limiting the influx of institutional investors into the crypto market. Regulators are at a crossroads, and it will take a while before they come up with the appropriate regulations for crypto custodial firms. However, it is imperative to enumerate on the following key takeaways of the explosion digital asset custodial-related developments. 1. The history and technicalities of custodial systems; 2. How traditional custody works; 3. Its impact on the digital assets class; 4. The current regulation governing their operations. 1. A brief overview of the inception of custodial services Before the advent of traditional asset custodial services, people had to keep documents that certified their rights to claim investments themselves. As you would expect, this method of tracking investment ownership was cumbersome and unsafe. After the stock market crashed in 1929, trust companies and financial middlemen started offering custody services. These entities took it upon themselves to help investors clear and transfer stock certificates. Like the self-custody method that preceded it, the custody solution that emerged during this period was also cumbersome. Subsequently, the growth of the securities market and the inefficiencies of this paper-burdened custody system led to the creation of the Depository Trust and Clearing Corporation DTCC in 1973. This agency evolved as the de facto issuer of certificates of clearing and centralized ledgers. Down the line, the proliferation of global investment products caused a domino effect, as a handful of financial institutions emerged as the most prominent global custody firms we have today. However, the creation of bitcoin and the explosion of blockchain-related solutions have changed the whole outlook of the asset custodial market with the innovative culture of the crypto space, and how much resources it has invested in tackling the security frailties of digital assets, making the difference. 2. So what is Custody to begin with? To get the full scope of the challenges of digital assets custodial services, it is vital to explore the concept of custody in the traditional investment market. Investing in traditional assets entails that an SEC-licensed Investment professional or institutional investor stores the cash or assets with registered third-party custodians. Unlike the crypto market, it is the registered (qualified) custodian that stores, records, and transfers securities. Furthermore, custodians are required under federal and state law to meet certain criteria that will prevent misappropriation of funds and frauds. Similarly, custodians issues account statements to investors periodically to update investors on the assets in their custody. As such, custodians are the ones that directly handle assets and not investment advisers. Current Flow of Assets in Traditional Financial Services 3. Digital assets and its impact on the global custodial market Not many would have envisioned the explosion of the crypto market when bitcoin first came into the fray. This technology has outperformed expectations, as it continues to reach new highs on two critical fronts — its value as an investment vehicle, and its disruptive force as a viable alternative to traditional systems. In just a decade, the crypto market, as a result of its volatile nature, has attracted investors in their millions, and regulators are concerned, more than ever, over its blistering pace. As noted, accompanying this proliferation are security concerns regarding the digital nature of cryptocurrency and its unconventional mode of storage. For one, cryptocurrency enables a decentralized network where coin holders have the responsibilities of safekeeping their holdings, as opposed to traditional assets. As such, cryptocurrency comes with cryptographic features that allow only the holder to access the digital assets by issuing him a private key (similar to a password but more complex). While this is an efficient security protocol, the backdrop is that the loss of a private key would render the digital assets it secures inaccessible and irretrievable. This downside has motivated developers to introduce various means of private key storage solutions. Presently, there are three major storage systems in use, and they include: Hot Storage: This storage solution requires that holders, especially crypto traders, keep their private keys online, so they can access them easily. this mode of storage makes digital assets susceptible to hacks Cold Storage: This solution is an offline storage system like a USB, or specially-made digital asset storage devices. It involves a manual process of accessing private keys, and It is considered a safer alternative to hot storage. Multi-Signature: Multi-signature is a more flexible system that offers a distributed form of private key storage where more than one entity is required to sign a transaction. In essence, this solution establishes a multi-signatory system, which requires the inputs of all the signatories before approving a transaction. While these solutions are peculiar to individuals, there has always been a clamor for platforms that would usher in the era of institutional digital assets investment that naturally entails custody. Although crypto custodial services are not new to the crypto space, it wasn’t until 2018 that large financial institutions began to show interest in entering the space. Today, there is a budding crypto custodial market on the horizon with Coinbase, Fidelity Digital Assets (a subsidiary of Fidelity Investments), BitGo, Kingdom Trust, Anchorage, Gemini Trust, and Northern Trust leading the way. Custodians are working on improving the standard of custodial services as many have introduced insurance and standard boosting initiatives that would ensure that lost assets are refunded. For instance, Gemini Trust is approved as a fiduciary under the New York Banking Law, section 100. It is, therefore, important to ascertain the regulatory implications of these developments and how institutional investors and financial professionals are adapting to them. “Fortunately a market of great options is rapidly emerging with firms like Fidelity, Gemini, Coinbase, BitGo and Bakkt offering secure and well regulated custodial options. Additionally, insurance is more readily available at the platform level to protect against losses. For institutional and retail investors alike, the days of security being a barrier to participation in the asset class are behind us.” — BlockFi CEO, Zac Prince 4. The regulatory uncertainties of digital assets custodial platforms While many have applauded existing and proposed investment products hinging on the performance of digital assets, it is clear that institutional investors are still in the backseat. This is because engaging with such assets entails that they store digital assets with standard third-party custody solutions. And since there are no regulatory reforms by which to measure standards, institutional investors have no other choice but to watch from the sidelines. More importantly, custodians are skeptical about the implications of the volatile crypto market and how it would respond to common practices like hard forks (the splitting of a blockchain into two independent blockchains). This uncertainty, coupled with the unavailability of tailored regulations for digital assets custodians, has tempered the growth experienced in this space. In response, the state of Wyoming enacted a regulatory framework that would authorize and govern the operations of a Special Purpose Depository Institution (SPDI) — an institution enabling banks to offer custodial services to licensed Wyoming corporations. Following this development, the Financial Industry Regulatory Authority (FINRA) and the Securities and Exchange Commission (SEC) released a joint staff statement that focuses on custodial requirements, and how it plays into the Customer Protection Rule. Under this rule, broker-dealers must ensure that their client’s digital assets are safe, and they must separate these assets from the firm’s accounts. By so doing, it becomes possible to return digital assets to the customers when the broker-dealer fails. Also, this rule mandates that broker-dealers physically hold their clients’ digital assets or enlist the services of third-party custodians. Although SEC and FINRA’s statement was simply an explanatory piece and not an official guide, it's backing of Wyoming’s regulatory framework sets in motion the possibility of a fully structured rule that would establish guidelines for digital asset managers. ”Custody is a critical step toward the institutionalization of [the] crypto economy… it will grow quickly to a point that it’s a meaningful piece of stable, recurring revenue for the company.” Coinbase CEO, Brian Armstrong The digital asset space has long heralded the unavailability of institution-grade crypto custodial services. This is one of the factors limiting the influx of institutional investors into the crypto market. Regulators are at a crossroads, and it will take a while before they come up with the appropriate regulations for crypto custodial firms. However, it is imperative to enumerate on the following key takeaways of the explosion digital asset custodial-related developments. 1. The history and technicalities of custodial systems; 2. How traditional custody works; 3. Its impact on the digital assets class; 4. The current regulation governing their operations. 1. A brief overview of the inception of custodial services Before the advent of traditional asset custodial services, people had to keep documents that certified their rights to claim investments themselves. As you would expect, this method of tracking investment ownership was cumbersome and unsafe. After the stock market crashed in 1929, trust companies and financial middlemen started offering custody services. These entities took it upon themselves to help investors clear and transfer stock certificates. keep documents that certified their rights to claim investments themselves. Like the self-custody method that preceded it, the custody solution that emerged during this period was also cumbersome. Subsequently, the growth of the securities market and the inefficiencies of this paper-burdened custody system led to the creation of the Depository Trust and Clearing Corporation DTCC in 1973. This agency evolved as the de facto issuer of certificates of clearing and centralized ledgers. Down the line, the proliferation of global investment products caused a domino effect, as a handful of financial institutions emerged as the most prominent global custody firms we have today. However, the creation of bitcoin and the explosion of blockchain-related solutions have changed the whole outlook of the asset custodial market with the innovative culture of the crypto space, and how much resources it has invested in tackling the security frailties of digital assets, making the difference. 2. So what is Custody to begin with? 2. So what is Custody to begin with? To get the full scope of the challenges of digital assets custodial services, it is vital to explore the concept of custody in the traditional investment market. Investing in traditional assets entails that an SEC-licensed Investment professional or institutional investor stores the cash or assets with registered third-party custodians. Unlike the crypto market, it is the registered (qualified) custodian that stores, records, and transfers securities. Furthermore, custodians are required under federal and state law to meet certain criteria that will prevent misappropriation of funds and frauds. Similarly, custodians issues account statements to investors periodically to update investors on the assets in their custody. As such, custodians are the ones that directly handle assets and not investment advisers. Current Flow of Assets in Traditional Financial Services Current Flow of Assets in Traditional Financial Services Current Flow of Assets in Traditional Financial Services 3. Digital assets and its impact on the global custodial market 3. Digital assets and its impact on the global custodial market Not many would have envisioned the explosion of the crypto market when bitcoin first came into the fray. This technology has outperformed expectations, as it continues to reach new highs on two critical fronts — its value as an investment vehicle, and its disruptive force as a viable alternative to traditional systems. In just a decade, the crypto market, as a result of its volatile nature, has attracted investors in their millions, and regulators are concerned, more than ever, over its blistering pace. As noted, accompanying this proliferation are security concerns regarding the digital nature of cryptocurrency and its unconventional mode of storage. For one, cryptocurrency enables a decentralized network where coin holders have the responsibilities of safekeeping their holdings, as opposed to traditional assets. As such, cryptocurrency comes with cryptographic features that allow only the holder to access the digital assets by issuing him a private key (similar to a password but more complex). While this is an efficient security protocol, the backdrop is that the loss of a private key would render the digital assets it secures inaccessible and irretrievable. This downside has motivated developers to introduce various means of private key storage solutions. Presently, there are three major storage systems in use, and they include: Hot Storage: This storage solution requires that holders, especially crypto traders, keep their private keys online, so they can access them easily. this mode of storage makes digital assets susceptible to hacks Hot Storage: Cold Storage: This solution is an offline storage system like a USB, or specially-made digital asset storage devices. It involves a manual process of accessing private keys, and It is considered a safer alternative to hot storage. Cold Storage: Multi-Signature: Multi-signature is a more flexible system that offers a distributed form of private key storage where more than one entity is required to sign a transaction. In essence, this solution establishes a multi-signatory system, which requires the inputs of all the signatories before approving a transaction. Multi-Signature: While these solutions are peculiar to individuals, there has always been a clamor for platforms that would usher in the era of institutional digital assets investment that naturally entails custody. Although crypto custodial services are not new to the crypto space, it wasn’t until 2018 that large financial institutions began to show interest in entering the space. Today, there is a budding crypto custodial market on the horizon with Coinbase , Fidelity Digital Assets (a subsidiary of Fidelity Investments), BitGo, Kingdom Trust, Anchorage, Gemini Trust, and Northern Trust leading the way. platforms it wasn’t until 2018 that large financial institutions began to show interest Coinbase Fidelity Digital Assets BitGo, Kingdom Trust, Anchorage, Gemini Trust, and Northern Trust Custodians are working on improving the standard of custodial services as many have introduced insurance and standard boosting initiatives that would ensure that lost assets are refunded. For instance, Gemini Trust is approved as a fiduciary under the New York Banking Law , section 100. introduced Gemini Trust New York Banking Law It is, therefore, important to ascertain the regulatory implications of these developments and how institutional investors and financial professionals are adapting to them. “Fortunately a market of great options is rapidly emerging with firms like Fidelity, Gemini, Coinbase, BitGo and Bakkt offering secure and well regulated custodial options. Additionally, insurance is more readily available at the platform level to protect against losses. For institutional and retail investors alike, the days of security being a barrier to participation in the asset class are behind us.” — BlockFi CEO, Zac Prince 4. The regulatory uncertainties of digital assets custodial platforms 4. The regulatory uncertainties of digital assets custodial platforms While many have applauded existing and proposed investment products hinging on the performance of digital assets, it is clear that institutional investors are still in the backseat. This is because engaging with such assets entails that they store digital assets with standard third-party custody solutions. And since there are no regulatory reforms by which to measure standards, institutional investors have no other choice but to watch from the sidelines. More importantly, custodians are skeptical about the implications of the volatile crypto market and how it would respond to common practices like hard forks (the splitting of a blockchain into two independent blockchains). This uncertainty, coupled with the unavailability of tailored regulations for digital assets custodians, has tempered the growth experienced in this space. In response, the state of Wyoming enacted a regulatory framework that would authorize and govern the operations of a Special Purpose Depository Institution (SPDI) — an institution enabling banks to offer custodial services to licensed Wyoming corporations. Following this development, the Financial Industry Regulatory Authority (FINRA) and the Securities and Exchange Commission (SEC) released a joint staff statement that focuses on custodial requirements, and how it plays into the Customer Protection Rule. enacted released a joint staff statement Under this rule, broker-dealers must ensure that their client’s digital assets are safe, and they must separate these assets from the firm’s accounts. By so doing, it becomes possible to return digital assets to the customers when the broker-dealer fails. Also, this rule mandates that broker-dealers physically hold their clients’ digital assets or enlist the services of third-party custodians. Although SEC and FINRA’s statement was simply an explanatory piece and not an official guide, it's backing of Wyoming’s regulatory framework sets in motion the possibility of a fully structured rule that would establish guidelines for digital asset managers. it's backing of Wyoming’s regulatory framework ”Custody is a critical step toward the institutionalization of [the] crypto economy… it will grow quickly to a point that it’s a meaningful piece of stable, recurring revenue for the company.” Coinbase CEO, Brian Armstrong ”Custody is a critical step toward the institutionalization of [the] crypto economy… it will grow quickly to a point that it’s a meaningful piece of stable, recurring revenue for the company.” Coinbase CEO, Brian Armstrong

The Age of Digital Assets Class' Custody

List of 50 Billion Dollar Companies (and their Key Leaders) Who are Using Blockchain Technology Introducing Blockchain 50 With assistance from industry consultants and other experts, ’ team of reporters and editors identified more than 100 big companies actively exploring blockchain through industry consortiums and other proprietary projects. This new list features 50 — with minimum revenues or valuations of $1 billion, and U.S. operations — that are currently leading the way in adapting decentralized ledgers to their operating needs. Forbes Allianz SE - Germany Hyperledger Fabric, Corda Robert Crozier, head of Allianz’s Global Blockchain Centre of Competence Blockchain platforms: Key leader: Amazon - Seattle Hyperledger Fabric, Ethereum (later in 2019) Rahul Pathak, general manager of Amazon Managed Blockchain at AWS Blockchain platforms: Key leader: Anheuser-Busch InBev - Leuven, Belgium Ethereum, Corda Tassilo Festetics, VP of global solutions Blockchain platforms: Key leader: Ant Financial, Hangzhou- China : Ant Blockchain : Geoff Jiang, VP of Ant Financial Blockchain Platforms Key leader BBVA-Bilbao, Spain : Hyperledger Fabric, Corda, public Ethereum : Carlos Kuchkovsky, CTO, new digital business Blockchain platforms Key leader Bitfury- Amsterdam : Exonum, Bitcoin : Valery Vavilov, CEO and cofounder Blockchain platforms Key leadership BNP Paribas- Paris : Corda, Hyperledger Fabric, Ethereum : Jacques Levet, head of transaction banking for Europe, Middle East and Africa Blockchain platforms Key leader BP PLC- London : Ethereum, Cardano, Quorum : Julian Gray, technology director, Digital Innovation Organization Blockchain platforms Key leader Broadridge- New York City : Hyperledger Fabric, DAML, Quorum : Michael Tae, head of strategy Blockchain platforms Key leader Bumble Bee Foods- San Diego : Multichain : Tony Costa, CIO Blockchain platform Key leader Cargill- Wayzata, Minnesota : Hyperledger Sawtooth, Hyperledger Grid : Keith Narr, VP, Cargill Digital Labs Blockchain platforms Key leader Ciox Health- Alpharetta, Ga : Ethereum : Florian Quarre, chief digital officer Blockchain platform Key leader Citigroup- New York City Ethereum Puneet Singhvi, managing director Blockchain platform: Key leader: Coinbase- San Francisco Bitcoin, Ethereum, XRP, Lumen Brian Armstrong, CEO; his Coinbase holdings make him a billionaire Blockchain platforms: Key leader: Comcast- Philadelphia Bitcoin, Ethereum, Hyperledger Fabric, Quorum Gil Beyda, managing director, Comcast Ventures Blockchain platforms: Key leader: CVS Health- Woonsocket, RI IBM Blockchain, Hyperledger Indy, Hyperledger Sawtooth Claus Torp Jensen, CTO of both CVS and Aetna Blockchain platforms: Key leader: The Depository Trust & Clearing Corporation- Jersey City Axcore Rob Palatnick, chief technology architect Blockchain platform: Key leader: Facebook- Menlo Park, CA Unknown David Marcus, blockchain lead Blockchain platforms: Key leader: Fidelity- Boston Bitcoin, Ethereum Tom Jessop, president, Fidelity Digital Assets Blockchain platforms: Key leader: Foxconn- Taipei, Taiwan Ethereum Jack Lee, founding managing partner of venture arm HCM Capital Blockchain platform: Key leader: Golden State Foods- Irvine, CA IBM Blockchain Bob Wolpert, chief strategy and innovation officer Blockchain platform: Key Executives: Google- Mountain View, CA Bitcoin, Ethereum, Bitcoin Cash, Ethereum Classic, Litecoin, Zcash, Dogecoin, Dash Allen Day, science advocate Blockchain platforms: Key leader: HPE- San Jose, CA Corda, Ethereum, Quorum, Sia, Hyperledger Fabric Raphael Davison, worldwide director of blockchain Blockchain platforms: Key leader: HTC- Taoyuan, Taiwan Bitcoin, Ethereum Phil Chen, decentralized chief officer Blockchain platforms: Key leader: IBM- Amsterdam Corda, Quorum, Hyperledger Fabric, Hyperledger Indy Mariana Gomez de la Villa, program director of distributed ledger technology Blockchain platforms: Key leader: ING- Amsterdam Corda, Quorum, Hyperledger Fabric, Hyperledger Indy Mariana Gomez de la Villa, program director of distributed ledger technology Blockchain platforms: Key leader: Intel- Santa Clara, CA Corda, Ethereum, Hyperledger Fabric, Hyperledger Sawtooth Michael Reed, director, blockchain program Blockchain platforms: Key leader: JPMorgan Chase- New York City Quorum Christine Moy, blockchain lead Blockchain platform: Key leader: Maersk- Copenhagen IBM Blockchain, Corda Michael J. White, head of TradeLens Blockchain platforms: Key leader: Mastercard- Purchase, NY Its own platform, built from scratch. Ken Moore, EVP and head of Mastercard Labs Blockchain platform: Key leader: MetLife- New York City InsureChain built on Ethereum Zia Zaman, CIO of MetLife Asia Blockchain platform: Key leader: Microsoft- Redmond, WA Ethereum, Parity, Quorum, Corda, Hyperledger Fabric Mark Russinovich, CTO of Microsoft Azure Blockchain platforms: Key leader: Nasdaq- New York City Symbiont, Corda, Hyperledger Fabric Johan Toll, head of digital assets, market technology Blockchain platforms: Key leader: Nestle- Vevey, Switzerland IBM Blockchain Benjamin Dubois, manager of digital transformation Blockchain platform: Key leader: Northern Trust- Chicago Hyperledger Fabric, Ethereum Justin Chapman, head of market advocacy and research Blockchain platforms: Key leader: Oracle- Redwood Shores, CA Oracle Blockchain Platform Frank Xiong, group vice president, Blockchain Development Platform Blockchain platform: Key leader: Overstock- Midvale, UT Bitcoin, Ethereum, RVN, Florin Patrick Byrne, founder and CEO of Overstock Blockchain platforms: Key leader: PNC- Pittsburgh Hyperledger Fabric, DAML, Corda, Ripple J. Christopher Ward, EVP and head of Treasury product management Blockchain platforms: Key leader: Ripple- San Francisco XRP Ledger Brad Garlinghouse, CEO Blockchain platform: Key leader: Samsung- Seoul Nexledger, Ethereum Jeanie Hong, SVP and head of Blockchain Center Blockchain platforms: Key leader: Santander- Madrid RippleNet, Hyperledger Fabric María de la Concepción de Monteverde, director of the Blockchain Center of Excellence Blockchain platforms: Key leader: SAP SE- Walldorf, Germany Hyperledger Fabric, MultiChain, Quorum Raimund Gross, chief innovation strategist, Blockchain Blockchain platform: Key leader: Seagate Technology- Cupertino, CA Hyperledger Fabric Manuel Offenberg, managing technologist and data security research lead Blockchain platform: Key leader: Siemens- Munich Ethereum, Hyperledger Fabric, Corda Bernd Rosauer, head of research, Technology Field IT Platforms Blockchain platforms: Key leader: Signature Bank- New York City A private, Ethereum-based blockchain Frank Santora, senior vice president and director of digital asset solutions Blockchain platform: Key leader: State Farm- Bloomington, IL Hyperledger Fabric, Corda, Quorum Mike Fields, innovation executive at State Farm RED Labs Blockchain platforms: Key leader: UBS- Zurich Hyperledger Fabric, Ethereum, Quorum, Corda Sam Chadwick, head of blockchain Blockchain platforms: Key leader: Visa- San Francisco Hyperledger Fabric . Kevin Phalen, global head of business solutions Blockchain platform: Key leader: VMware- Palo Alto, CA Project Concord, a new blockchain, which supports multiple frameworks such as Ethereum Mike DiPetrillo, senior director, Blockchain Blockchain platforms: Key leader: Walmart- Bentonville, AR Hyperledger Fabric Karl Bedwell, senior director, Global Business Services & Technology Blockchain platform: Key leader:

List of Leading Billion Dollar Companies using Blockchain

The future of blockchain might come wearing a suit and tie, but I’m okay with that. As mentioned in my last article, Thus, it’s been difficult to pinpoint how I really feel about the current direction of the blockchain space. The retail market has been beaten to hell. I don’t have proof of it, but The past months have been arduous for most cryptocurrency investors, Bitcoin and Ethereum have both plummetted in price. Despite a wave of recent good news, the market remains in a downtrend- I came here for the technology, I stayed for the community and ideology. judging by the two occasions DOGE has increased by 100% in the past 30 days I’d guess that market manipulation hasn’t gone anywhere. almost as if it’s waiting for something. Over the past few months, I’ve learned a lot about blockchain, financial markets, and the nature of money. If you read some of my earlier writing, I was a little more aggressive with my ideology. As I’ve begun to work more deeply in the space, and meet people from walks of life I never thought I’d be crossing paths with, I’ve learned that it’s not quite as black and white as I thought. An Institutional Entry Point Imagine that you’ve been standing on the sidelines watching the cryptocurrency market for the past couple of years. While those who invested around December of last year might be reeling from their capital losses, the market can look quite appealing at these levels if you haven’t found an entry point yet. I’m of the belief that institutional investors will spur the next bull run in the cryptocurrency market. Whether it be through directly investing in the market, or through pushing forward new developments like , Bitcoin ETFs, and . Bakkt Coinbase Prime The longer this bear market carries on, the more the stage is set for institutional investors to enter. We just need to knock down a few barriers for them first. Barriers to Entry It’s been difficult for institutional investors to enter the market even they’re interested in doing so. Bitcoin and cryptocurrency as a whole are looked at within a spectrum of diverse opinions, coming from hedge funds, banks, family offices, and the like. Either they’re all aboard the band-wagon, or they think that same wagon is heading towards impending doom. if One of the reasons institutional investors have been slow to enter the market is a lack of infrastructure. There are services they require that the average investor doesn’t, and some of these services don’t exist just yet. If they do exist, they aren’t in a regulated environment, which makes it difficult to invest when you’re handling a large amount of capital, often belonging to several different people who have entrusted you with their funds. Blockchain and cryptocurrency are in their technological infancy, they’ve barely been around for a decade. As it matures, it’s starting to draw more and more interest from institutional investors — as a result — the infrastructure and products they need to safely invest in the space have started to arise. These elements that help lower barriers to entry for large investors bring an exciting outlook to the future of blockchain. As infrastructure is built, more and more investors will feel safe investing. As new investment vehicles are created, new pools of capital will be able to flow into the crypto market. Institutional investors are gearing up to bring on the next bull-run, and by the looks of the products they’ll have at their disposal, it could be a big one. I initially wrote this as an intro to an article on BAKKT, but it got quite lengthy so I’ve split it into two — the next article will go into how these services and products set the stage for BAKKT, and what it actually is. Understanding Institutional Investment Vehicles In Cryptocurrency Let’s focus on 4 key areas. For the sake of simplicity, think of Custodian services as infrastructure, and derivatives, investment funds, and ETFs as products. Custodian Services: Derivatives; Investment Funds; ETFs; and Bakkt. CUSTODIAN SERVICES The lack of trusted custodian solutions in cryptocurrency has been a significant roadblock for institutional investors hoping to enter the space. Think about how nerve-wracking it can be to handle the security of your own assets — multiply those assets value by 100–10,000 and imagine how much more concerned you’d be. Image by on Chris Barbalis Unsplash Custodian services are services that hold and secure your assets. In the case of crypto, this can get quite complicated. There are high levels of risks as custodians are honey-pots for hackers, and extreme measures need to be taken when protecting a large number of assets. The lack of regulation around the space also makes it difficult for would-be service providers to create solutions. The traditional finance world and its inhabitants have little experience in cryptocurrency custody. To be fair, the concept of custodial services for cryptocurrency has only been around for a few years — even the experts in this field are still learning as they go. There has been some movement from large financial institutions towards providing these services, but a decisive leader has yet to appear. Bank of America filed a solutions and Northern Trust Corporation (a company with over $1 trillion USD in assets under management) has announced , but it won’t be available for another 12 months at least. patent for cryptocurrency custody they’re working on a solution Coinbase Custody Although a pressing issue, there are solutions being developed. that will place 98% of funds in cold storage and offer criminal insurance to cover the 2% that is stored online. Coinbase, a well-known crypto exchange, has been working on a custodian service Coinbase was founded in 2012 and has never been hacked, making it an obvious contender for preferred service providers when institutional investments begin entering the market. To bring this service to life, Coinbase partnered with ETC (Electronic Transaction Clearing), a registered broker-dealer and member of FINRA. The partnership between Coinbase and ETC bridges the gap between traditional finance and cryptocurrency worlds by ensuring that the custodian service will fall under standard SEC regulations. The issue with custody in crypto isn’t so much a lack of solutions, but a lack of trusted and regulated solutions — making this partnership big news for the industry. They’re also facilitating institutional trading through their new platform called . Coinbase Prime If the largest companies in the space are dedicating their time to creating investment vehicles and infrastructure for institutional investors, then that’s probably what’s best for the market. Ledger Vault Created by the team behind Ledger Nano S hardware wallets, Ledger Vault promises “End to End Security” independent of third-parties, meaning that investors keep control of their own private keys. Ledger has established a strong reputation in Crypto Security through selling . Ledger Vault opened up early access last May, they’re currently going through testing with a small batch of customers to iron out any remaining kinks before their full product launch. millions of Ledger Nano hardware wallets Xapo Vault Possibly one of the most interesting custodian solutions available, Xapo Vault is an actual vault — as opposed to Ledger Vault, which is just, well, a name. When it first started, many of us heard about the first Xapo Vault location, carved into a Swiss mountainside. Since then, they’ve upgraded their security to include . This helps prevent capital losses due to natural disasters in specific locations. The vaults boast “human and automated guards”, which sounds terrifying. several vaults spread out across the globe Gemini Owned by the Winklevoss brothers, Gemini is a crypto exchange that has applied for a Bitcoin ETF (so far it has been rejected). by the SEC, they are still working on bringing an institutional grade investment vehicle to market. Although temporarily rejected DERIVATIVES What are Derivatives? Derivatives, specifically futures and options contracts are speculative and leveraged trading vehicles, usually reserved for institutional investors. Owning a derivative differs from owning a cryptocurrency because derivatives don’t represent any actual ownership of an asset, they represent speculative value derived from the performance of the underlying asset. For example, if I buy a $10,000 Bitcoin futures contract, I’m not buying $10,000 worth of Bitcoin, I’m buying a contract that’s worth $10,000, that will increase or decrease in value depending on what direction I bet the market is moving. of represented underlying assets. The capital used in derivative markets is mostly derived from institutional investors, who currently don’t have a method to invest in Bitcoin or other cryptocurrencies. Crypto derivatives give capital the ability to flow out of the derivatives market and into the crypto market. The global derivatives market is estimated to be worth around $540–1200 trillion Available Crypto Derivatives There are currently Bitcoin Futures contracts available on and . They expire twice per month, and are cash settlement only, meaning that no bitcoin needs to be put up as collateral. CME CBOE A potential use case for these futures is the ability for miners to hedge against the market. If they fear the market will begin to go down, they can purchase futures to protect themselves if the price of Bitcoin goes down, and their mining operations become far less profitable than usual ( ). as we’re seeing with Bitmain at this point in time INVESTMENT FUNDS Some of the first methods for institutional investors to take part in Bitcoin trading were via investment funds. Investment funds like GBTC sell shares in their fund and tie their shares to a certain amount of Bitcoin in value. Unfortunately, due to there being a fixed supply of shares available, the price of these shares don’t always match up with the price of Bitcoin. EXCHANGE-TRADED FUNDS (ETFs) What are ETFs? An Exchange Traded Fund (ETF) invests in a group of underlying assets or derivatives so that people who buy ETFs don’t have to actually own an asset to benefit from its’ price movement. ETFs come in different shapes and sizes, they can use leverage and operate inversely to the asset their tied to, or operate as a normal stock. Bitcoin ETFs Bitcoin ETFs have been getting a lot of attention in the media lately as a couple different players in the crypto space have started to bring them forward for approval by the U.S. Securities & Exchange Commission (SEC). So far, all of the ETFs brought forward , which is disappointing given the potential increase in market size an ETF can bring. Just yesterday the on whether or not to approve certain Bitcoin ETFs. The decision has been pushed back to late December as the SEC hopes to uncover more information. have been rejected SEC delayed the decision “Some believe that a cash-redeemed bitcoin investment instrument like an ETF is the lever that will finally open the bitcoin market to large scale entry, particularly by institutional investors who have not yet made the jump.” — Crypto Coin News BAKKT — Digital Asset Exchange The owner of the New York Stock Exchange (NYSE) recently announced that he’s working on a federally regulated marketplace for digital assets such as cryptocurrencies. The exchange, called Bakkt, will aim to be a globally regulated ecosystem for digital assets. To add to the excitement, they’re launching Bakkt in partnership with companies such as Microsoft, Starbucks, and the Boston Consulting Group. Microsoft is contributing to the project through Azure, their cloud computing solution. On the retail side, Starbucks is going to be the flagship retailer, allowing customers to convert cryptocurrency and to U.S. dollars in Starbucks stores. Curious about what Bakkt might decide to include? Think about reward points, which are in a way cryptocurrencies themselves, they just exist in a closed loop I.e. once you convert to Starbucks points, you can’t convert back to your base currency. Through Bakkt, and its partnerships with companies like Starbucks, we will have a digital asset exchange that allows us to trade rewards points, air miles, gift cards, cryptocurrencies, and tokenized assets (amongst many more). other digital assets other digital assets This is both important and incredibly exciting for the cryptocurrency market. As we’ve learned, much of what holds institutional investors back from entering the space is a lack of infrastructure. They aren’t willing to compromise the security or efficiency they have in traditional markets in order to trade a . Most exchanges also lack the liquidity required for a pool of institutional investors to partake, there simply isn’t enough trading volume for their orders to be filled. While the precise solution hasn’t been discussed, Bakkt claims that it will increase liquidity as part of its efforts to spur adoption of cryptocurrency amongst institutions and retail investors. Bakkt will also reduce volatility within its platform by allowing cryptocurrency investors to hedge against it shiny new Bitcoin The formation of Bakkt is the most exciting piece of cryptocurrency news I’ve heard in a long, long time. Not only will this serve as an institutional trading platform to usher in family offices, hedge funds, and other institutional investors — it will also increase adoption of blockchain amongst retail investors, with a user a friendly platform and trust established through the credible names involved. The Future of Blockchain While the development of custodian services, Bitcoin ETFs, and crypto investment funds are exciting to learn about. Bakkt is a game changer. The other investment vehicles and infrastructural developments are aimed mostly at institutional investors, while Bakkt will both facilitate capital influx from these institutions, as well as create a credible platform for a new wave of retail investors to join in on the crypto-fun. I for one, can’t wait for the day I’m sitting at my laptop trying to trade Bitcoin against Virgin Airline miles (I notoriously never by flights until the last minute, my only recourse will be to beat the market). Or the thought that some day soon I might be able to hide my funds from market volatility with gift cards instead of Tether ( ). gross

Bakkt, Institutional Investors, and the Future of Blockchain

Named bond-i, the World Bank bond will be created and managed with distributed ledger technology. The has announced it is partnering with the Commonwealth Bank of Australia (CBA) to issue the world’s first-ever global blockchain bond. World Bank The new bond is named bond-i, an acronym for — and a reference to one of Australia’s most famous beaches, Bondi Beach in Sydney. Blockchain Offered New Debt Instrument The operation could lead to “a golden future” for financial services for developing nations, a World Bank official told news agency . Agence France-Presse “Today we make history,” reads a tweet by World Bank treasurer Arunma Oteh. “Today, we believe that emerging technologies, equally offer transformative, yet prudent possibilities for us to continue to innovate, respond to investor needs and strengthen markets,” she added in a World Bank press release. It is “the first bond globally to be created, allocated, transferred, and managed through its life cycle using distributed ledger technology,” reads the release from the World Bank, which issues between $50 billion and $60 billion annually in bonds to fund sustainable development in emerging economies. “Blockchain has the potential to streamline processes among numerous debt capital market intermediaries and agents. This can help simplify raising capital and trading securities; improve operational efficiencies; and enhance regulatory oversight,” the release adds. As points out, “there aren’t many details available yet on how this will actually work from a technical or logistical standpoint.” It seems that “unlike Bitcoin, where anyone can engage in mining, the process of verifying new transactions, the World Bank will use a private version of in which validators must have permission. MIT Technology Review ethereum The CBA mentions that, currently, the Ethereum platform has the largest and active development community, offering the features they require. However, other blockchains are rapidly developing and CBA will keep open to other options in the future. The development of this offering has been conducted with the support and input of the investor community including Northern Trust, , and the Treasury Corporation of Victoria. World Bank infrastructure for the bond will run in Washington DC on the Microsoft cloud computing platform. Microsoft validated the system’s operational capabilities, security, and scale. QBE Build Azure “The idea of using blockchains to manage bonds is gaining traction,” MIT writes. “Last year, a company in the UK [namely, ] issued a bond using Ethereum’s public blockchain. The city government of Berkeley, California, is exploring the use of blockchain technology to issue municipal bonds. The World Bank’s endorsement of the idea is the highest-profile one to date.” Nivaura The new bond by the World Bank comes under AAA rated, and will focus to raise the capital for the Reconstruction and Development division of the World Bank. The CBA, according to its spokesperson, says that the bond is expected to raise in between $50 and $100 million.

The first global blockchain bond

1. BoE Governor Reassures the G20 Over Crypto Assets, Bitcoin’s Rise Follows Mark Carney, governor of the Bank of England, and Financial Stability Board (FSB) Chair, to the finance ministers and Central Bank Governors attending the G20 Summit in Buenos Aires. The , dated March 13th, states that crypto-assets do not represent a risk. It informs readers that the FSB has investigated the phenomenon, and does not deem crypto-assets a risk, despite the volatility. The news could be one of the reasons for Bitcoin’s growth, at the time of writing. We also previously on Carney stating that Bitcoin does not represent a threat to financial stability, and his stance does not seem to have changed. He hinted that his successor, who will replace him next year, will focus on reassessing existing regulations, rather than creating new ones. has written a letter document trading at $8500 reported 2. MasterCard Remains Open to Cryptocurrencies Financial services giant MasterCard is open to the idea of state-owned cryptocurrencies. When , the co-president of the Asia-Pacific branch, Ari Sarker, said that the company would be open to helping simplify the adoption of this type of cryptocurrency. The executive’s words come as many countries have expressed interest in a digital currency issued by their central bank. MasterCard would be favourable to a cryptocurrency backed by regulators, and not issued anonymously. Sarker went on to say that they are currently testing a program in Japan and Singapore which would allow cash withdrawals of Bitcoin using their cards; strict know your customer (KYC) and anti-money laundering regulations are involved. interviewed by the Financial Times 3. UK Government To Investigate Possible Risks of Cryptocurrencies Junior Finance Minister John Glen has stated that the British government will into the risks cryptocurrencies such as Bitcoin could bring. The decision was spurred by the growing popularity of cryptocurrencies. More positive words were spent on blockchain, which is seen as a technology with great potential. The analysis will be conducted in collaboration with the Bank of England and the FCA (Financial Conduct Authority). However, the desire to build a FinTech Hub reputation for the country means that strict regulations are not expected to be enacted. launch a deeper investigation 4. Northern Trust Boosts Its Blockchain System Financial institution The Northern Trust Company is with accounting firm PwC on a tool allowing private equity fund auditors to take advantage of data which is being stored on the institution’s private blockchain. This will help to save a significant amount of time, as clients will not be required to wait for reports anymore. Despite the system being live for some time, the new feature has been introduced recently, with the aim of attracting more clients. Furthermore, the IBM Blockchain Platform is for the network upkeep, which is based on the open-source Linux Foundation Hyperledger Fabric. Lastly, cryptography and key management are used for the scalability and security of transactions. collaborating being used This news roundup was brought to you by . BlockEx To receive our daily news roundup in your mailbox, sign up here: http://bit.ly/BlockExNewsRoundup-Updates

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