Financial news

Duncan Trenholme, co-head of digital assets at TP ICAP, said the firm had experienced “growing demand from our traditional client base” for the service.

It comes as the FCA continues to work up a rulebook for the sector in the UK, and as the crypto world continues to suffer shockwaves from last month’s collapse of FTX.

Neither have deterred the institutional segment of the market from getting involved, however, with BlackRock’s Emea head Stephen Cohen telling Financial News the money manager was exploring using crypto technology to tokenise traditional assets on the blockchain.

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Last week Fidelity Digital Assets’ head of institutional Chris Tyrer told FN the firm had seen “a pretty substantial uptick in client activity and deposits owing to the recent events,” describing the trend as a “flight to quality”.

A parliamentary update in October saw the FCA’s jurisdiction extended to cryptoassets, paving the way for a more comprehensive set of rules for the sector, after MPs approved changes to the Financial Services and Markets Bill. Until the amendment, the bill only included measures to extend existing regulations to payments-focused stablecoins.

The extension means that the FCA will be able to regulate crypto promotions and ban companies that are not allowed to operate in the UK. Most crypto-related businesses are not currently under the FCA’s control, instead relying on a registration process, which looks only at anti-money laundering and financial crime measures.

Some 85% of crypto firms have failed in that registration process, chief executive Nikhil Rathi told the Financial Times Global Banking Summit on 30 November.

“Over time, we believe blockchain will lead to the tokenisation of traditional asset classes. This will result in a more efficient, automated, and risk-mitigated trading and settlement process for financial markets,” Trenholme said.

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