Coinbase has made a huge move in the crypto world and attracted to cooperation the first hedge fund with assets worth $20 billion.
The Coinbase team is also working to attract other large hedge funds to its site.
Coinbase took up the challenge of creating a full-scale service of primary brokering on Wall Street, which helps institutional investors carry out cryptocurrency transactions.
Although prime brokers on the main financial street of New York are not uncommon, the high barriers prevent the potential investors from entry into the crypto world potential.
Note that the primary brokerage service provides hedge funds with a wide range of operational services (clearing, operational support, settlement of transactions and risk management), thereby helping companies to focus exclusively on the investment strategy.
“Without a primary broker, trading firms are directly exposed to events that may occur with the exchange, for example, break-ins, regulatory turmoil, operational and technological problems, ” said Colleen Sullivan, head of the CMT Digital venture company.
It is not yet known whether the Securities and Exchange Commission (SEC) will interfere with the activities of Coinbase Prime.
Also in Coinbase’s plans by the end of the year to provide institutional investors with services for margin trading.
“Coinbase is developing many diverse initiatives that bring the company closer to traditional finance: storage, financing, loans, security tokens, and institutional portal. The company has the resources to finance these projects, and I believe that they will have some success, ” said Richard Johnson, a consultant for the financial services industry at Greenwich Associates.