By Emily Nicolle
Of Financial News
Standard Chartered PLC is to launch a digital asset brokerage and exchange platform for U.K. and European institutional and corporate clients.
The new platform will be spearheaded as a joint venture between StanChart's innovation unit SC Ventures and BC Group, a digital asset firm which manages Hong Kong-licensed crypto exchange OSL.
Based in the U.K. to target the European institutional crypto market, the joint venture is as yet unnamed and subject to regulatory approval. The new company will provide traders with access to bitcoin, ether and other digital assets, and is set to launch in the fourth quarter of 2021.
The move positions StanChart as a rival to some of the world's biggest institutional crypto exchanges, including the Winklevoss twins' Gemini, BitGo and London-based LMAX Digital.
Institutional and corporate investors alike have ploughed into the cryptoasset space this year as bitcoin and other tokens took off. Data collected by StanChart showed the total volume of trading on major exchanges averages over $4 billion per day as of this month, with a total market capitalization of over $1 trillion across all cryptoassets.
StanChart joins investment banks Morgan Stanley, Goldman Sachs Group Inc. and BNY Mellon among the Wall Street names getting in on the action, as several lenders revealed plans to launch cryptocurrency trading desks for clients earlier this year.
JPMorgan Chase & Co. also has a dedicated blockchain unit named Onyx, focused on developing its own token JPM Coin and an interbank payment network.
Meanwhile Tesla Inc., Square Inc. and MicroStrategy Inc. have collectively bought billions of dollars worth of bitcoin for their corporate treasuries.
The new company will offer brokerage and exchange services to enable wider adoption and trading of cryptocurrencies by "the world's largest and most demanding of investors," said Alex Manson, head of SC Ventures.
"We have a strong conviction that digital assets are here to stay and will be adopted by the institutional market as a highly relevant asset class," Mr. Manson added Wednesday.
SC Ventures' Nick Philpott will become the firm's chief operating officer, while BC Group's chief information officer Usman Ahmad will become CEO.
StanChart has already made several advances into cryptocurrencies, including launching an institutional custody service Zodia Custody through a strategic partnership with Northern Trust in December.
It also took a stake in blockchain technology provider Metaco in July, and said it was working with central banks in Thailand and Hong Kong to explore blockchain-based cross-border money transfers.
(END) Dow Jones Newswires