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September 17, 2018
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Morgan Stanley, one of the largest investment banks in the world is rumored to the in the process of creating a product that will allow its clients to swap fiat currency for bitcoin and vice versa. As noted by CCN, this sixth largest bank here in the United States in terms of assets is quietly developing a derivatives product that will benefit clients who are interested in investing in Bitcoin.
The report indicates that the U.S bank will provide smart contracts that will provide investors with the much-needed synthetic exposure to the trading of bitcoin on various exchange platforms. Another verified source also revealed that investors will be able to go long or short using price return swaps. The bank will charge a fee for each transaction to support the functionalism of the platform.
Note that CEO James Gorman had earlier indicated that the bank would not allow its clients to trade in cryptos directly using the bank. The sudden change of heart could have been informed by the sharp increase in value of the market as well as widespread adoption and creation of new digital currencies. The product is almost completely and currently waiting internal approval for it to be made available to the customers.
This bank joins an increasing number of financial institutions who are evaluating the best ways of incorporating cryptocurrencies into their financial operations. Citigroup and Goldman Sachs have also hinted about providing bitcoin derivatives products to their customers.
Intercontinental Exchange (ICE) New Product
In other news related to cryptocurrency trading, Intercontinental Exchange is in the process of creating the first physically delivered bitcoin futures product. Note that ICE is the largest stock exchange platform in the world at the moment. Once this new product is launched, investors will be able to settle contracts using actual BTC instead of fiat currency such as the US dollar. In fact, most of the bitcoin futures products offered by platforms such as CBOE and Chicago based exchanges CME relying heavily on fiat currency.
Closing Remarks
The news that Morgan Stanley is in the final stages of launching a product that will cater for customers who are interested in cryptocurrency is good news for the industry. It shows that banks and governments have understood how blockchain technology works and are no longer afraid that trading in cryptocurrencies could affect the economy negatively.
Continued development of similar products will help increase the number of people who invest in the currencies. It will also help spread the world about the power of having digital assets to countries that are yet to adopt this technology fully. Nonetheless, it is important for the banks and governments to work together to create policies that will promote the growth of the industry. These policies will ensure that all parties involved get value for money and don’t end up losing money on wrong deals. Cryptocurrency and blockchain technology is here to say and will continue to improve lives of millions of people from all across the globe.
