Bitcoin ETFs drive demand for borrowing in crypto markets
Mismatch between cash and crypto settlement cycles creates pre-funding challenge
Crypto markets are grappling with the cost of funding bitcoin purchases by cash-settled exchange-traded funds (ETFs) that operate on a T+1 cycle.
The problem is a symptom of the mismatched settlement cycles for cash and cryptocurrencies. When investor demand for a bitcoin ETF rises, firms called authorised participants (APs) – generally banks and high-speed trading firms such as JP Morgan and Jane Street – create more shares by sending cash to the fund manager, who purchases the underlying
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe
You are currently unable to print this content. Please contact info@risk.net to find out more.
You are currently unable to copy this content. Please contact info@risk.net to find out more.
Copyright Infopro Digital Limited. All rights reserved.
As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (point 2.4), printing is limited to a single copy.
If you would like to purchase additional rights please email info@risk.net
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (clause 2.4), an Authorised User may only make one copy of the materials for their own personal use. You must also comply with the restrictions in clause 2.5.
If you would like to purchase additional rights please email info@risk.net
More on Markets
New fee plans for FXGO rile dealers
Bloomberg plans to charge spot FX market-makers from next year
CME, FICC in talks to expand cross-margining to client accounts
New rules and account structures will be needed to allow cross-margining by non-members
Margin calls jumped threefold as global markets sold off
FCMs claim no client defaults, but episode revives complaints of procyclical margining
Treasury futures super-user switches to swaps
Capital Group’s Anbax fund slashes UST futures holdings in move to alternative rates derivatives
Traders flipped long yen vol ahead of market rout
Hedge funds and real money bought long yen volatility in the run-up to Monday’s turmoil
Vega peak was foothill in historic Nikkei selloff
JFSA scrutiny has curbed issuance of autocallables, so stock plunge generated light re-hedging
Coex Partners hires former Citi head of FX Apac sales
Matt Long joins Coex in Singapore to oversee FX execution and trading strategy for regional clients
FX venues improve ‘stickiness’, Citi review finds
Improvements in tech stability, execution quality and bespoke services appease users
