M&G Pumps $20 Million into UK's First Regulated Bitcoin Derivatives Exchange, GFO-X
Summary:
UK-based pension fund M&G's investment branch has channelled $20 million into the UK's first regulated Bitcoin derivatives exchange, Global Futures & Options Holdings (GFO-X), as part of a $30 million Series B funding round. The platform will predominantly offer clearing of Bitcoin index futures and options contracts. The investment aims to create a hub for trading and clearing cryptocurrency derivatives, foster innovation in the sector, and allow traditional financial institutions to access a variety of cryptocurrency derivative investment products.
London-based pension fund, M&G's investment branch, has pumped $20 million into the UK's premier regulated Bitcoin (BTC) derivatives exchange, Global Futures & Options Holdings (GFO-X). The details of the investment, announced jointly by M&G and GFO-X, is part of a $30 million Series B funding round for the derivatives exchange. Initially, Bitcoin index futures and options contracts will be offered up for clearing on the platform.
This step brings traditional financial institutions toward exposure to a range of cryptocurrency derivative investment items. GFO-X is on a path to become a crypto derivatives trading avenue, over which the Financial Conduct Authority (FCA) has regulatory control and offers central clearing.
The $20 million investment emerges from M&G's Crossover strategy, born out of a series B funding round and the $138 billion Prudential With Profits Fund. This strategy focuses on consistently growing private companies at a rapid pace.
The financial investment is targeted at cultivating a hub for transacting and clearing cryptocurrency derivatives and promoting innovation within the field. The deal also includes a provision for M&G to secure a position on GFO-X's board.
M&G's portfolio manager, Jeremy Punnett, remarked on the potential for London and the UK to evolve into prime locations for cryptocurrency technology and investment. The absence of regulated trading platforms, Punnett asserts, is significantly impeding the expansion of the digital currency trading market.
Arnab Sen, GFO-X's CEO, noted that emerging regulations in the UK and Europe are gradually ushering cryptocurrencies into standard finance services. However, this eventual integration hinges on melding traditional market infrastructures with the perceived risks linked to the evolving asset class.
Sen conveyed that constructing a regulated financial market ecosystem can prove intricate, lengthy, and costly, and the dangers of hastening this process are now glaringly evident to all.
For the long-range viability of digital assets, and the digitisation of real, tangible assets, there must be concerted collaboration between traditional market players and innovative disruptors.
In the wake of growing interest in cryptocurrencies from investors, the FCA laid out further instructions to industry service providers to ensure they adhere to the UK's rules for promoting crypto assets. Consequently, some operators have decided to exit the country, while others have resolved to meet the stringent requirements for advertising within the UK.
Published At
12/11/2023 4:58:48 PM
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