Cryptocurrencies are vulnerable to price drops, but companies are weathering the storm to introduce new products to users. The pairing of Citadel and Virtue are teaming up to provide retail brokerages with a simple way to gain crypto exposure.
Citadel Securities and Virtu Financial Inc., major market makers, are teaming up to create a “cryptocurrency trading ecosystem”, indicating an increase in crypto adoption.
The ecosystem in development is reportedly looking to open doors for wealth managers and other market makers to “create more efficient access to deeper pools of liquidity for digital assets”. The ecosystem is expected to allow retail traders to offer tailor-made crypto services to their customer base.
“It is more of a crypto trading ecosystem or marketplace than an exchange,” a source said. “It’s going to take exchanges by making it a better mousetrap.”
According to Bloomberg, the collaboration between the two firms has gained some steam in the industry, with Fidelity Investments and Charles Schwab Corp showing interest in the product. Sequoia Capital and Paradigm are reportedly backing the product.
Schwab spokeswoman Mayura Hooper said, “We know there is significant interest in this cryptocurrency space and we would like to invest in firms and technologies working to provide access in a strong regulatory focus and secure environment.” The firm confirmed that it made a “minority, passive strategic investment” and further disclosed that it has no plans to offer direct crypto trading at the moment.
Citadel’s CEO Has A History With The Crypto Public
Citadel’s latest move to gain a foothold in the crypto ecosystem may come as a surprise to enthusiasts. The firm’s CEO Ken Griffin had previously referred to the asset class as a “jihadi call” against the dollar and bore the tag of a known crypto skeptic.
Earlier in the year, he famously defeated ConstitutionalDAO in a race to purchase an original copy of the US Constitution, which drew strong opposition from community members. Nevertheless, unlike its competitors such as Jump Trading and Jane Street, who are already making plays in this area, the move to enter crypto will be the first of its kind by Citadel.
The bearish sentiments did little to dampen firms’ enthusiasm in introducing new products. Robinhood revealed plans to unveil a new crypto wallet with the firm’s CEO stating that “the crypto winter is the best time to build one.”
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