Broker to world's biggest banks explores crypto trading

TP Icap, one of the largest brokers sitting between banks in the global financial markets, has set up a working group to examine how it should approach cryptocurrencies.

The interdealer broker, which helps to match buyers and sellers of bonds and derivatives, set up the group this year as the world’s biggest dealing banks began to take similar steps, according to people with knowledge of the matter.

The working group includes some of TP Icap’s most senior business leaders, one of the people said.

Investment banks, which are among TP Icap’s biggest clients, have warmed to the new asset class despite early reluctance. Goldman Sachs and JPMorgan are among those considering their options in the sector — including around trading the assets — while BlackRock, the world’s largest asset manager, has set up a cryptocurrency working group.

TP Icap’s crypto group was set up under former chief executive John Phizackerley, a trading veteran of Lehman Brothers and Nomura, who was ousted earlier in July due to mounting costs associated with Brexit and regulation.

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New CEO Nicolas Breteau, previously the group’s head of global broking, is expected to focus on TP Icap’s financial performance and meeting investors, one of the people said.

TP Icap was formed in late 2016 when Michael Spencer’s Icap sold its voice-broking business to City rival Tullett Prebon. In the same year, Tullett signed an agreement with a crypto data provider called Brave New Coin to distribute data on digital money.

The remaining parts of Icap were rebranded as NEX Group, which owns venues for trading bonds and currencies. NEX has been exploring the potential of blockchain, the distributed ledger technology that underpins bitcoin.

The two businesses have experienced contrasting fates this year. TP Icap’s share price slumped by more than 35% when the broker announced Phizackerley’s departure. But NEX shares jumped after Michael Spencer, the founder and CEO of NEX, agreed to sell it to derivatives exchange CME Group for £3.9bn in March.

CME is one of two big exchanges offering trading in bitcoin futures, a type of financial instrument that can be used to bet on the price of the cryptocurrency without owning the underlying asset.

By 

Samuel Agini