Switzerland’s SIX explores cryptocurrency exchange launch

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The Swiss exchange is exploring creating a venue in Europe for cryptocurrency trading in a bid to compete in a market dominated by long-established digital asset firms such as Binance, OKX and Coinbase.

The group is considering using its reputation and Switzerland’s advanced cryptocurrency laws as a hook for large traditional investors who are increasingly interested in trading digital assets.

“Crypto has increasingly become a recognized asset class,” Bjørn Sibbern, global head of exchanges at SIX Group, told the Financial Times, adding that the company is looking at creating “a platform where we can help facilitating trading, whether it’s ) crypto or whether it’s derivatives.”

Traditional financial firms have so far largely shied away from setting up crypto trading venues due to a lack of clear regulation and fears of reputational damage.

Several large firms such as Deutsche Boerse, Nomura and Standard Chartered have established their own crypto exchanges, usually separate from their main businesses.

But CBOE Global Markets closed its spot crypto venue this year, blaming a lack of clear regulation. CME Group explored launching bitcoin trading in May, the FT reported, although its chief executive has since said the exchange has no current plans.

The approval of bitcoin and ethereum exchange-traded funds by the US Securities and Exchange Commission earlier this year has spurred a wave of retail and institutional investment in the asset and raised hopes that more investors will be keen to trade the currencies directly themselves.

Although the price of bitcoin, the world’s most popular cryptocurrency, has fallen to around $60,000 from a record high of around $72,000 earlier this year, it is still up 40% this year.

Switzerland has become one of the friendliest countries in Europe, with laws on trading and custody of assets and the classification of different types of tokens that many other countries have yet to introduce.

“We’re looking at other ways to expand into Europe and as part of that we’re also looking at (whether) crypto should be part of that,” Sibbern said, adding that the spot would only be available to institutions. investors such as asset managers.

“We are seeing the trend of more and more global banks and institutions looking at crypto,” he added.

SIX runs a crypto-derivatives company called AsiaNext in Singapore in a joint venture with Japan’s SBI Group. “We’re looking at doing something similar in Europe,” Sibbern said, adding that the company “may also say this is something we don’t want to pursue.”

The Swiss group, which is owned by 120 banks, runs a separate digital exchange where nine digital bonds have been listed since 2018 by issuers such as investment bank UBS and the local authority of the city of Lugano. Sibbern said digital exchange “could . . . expand this concept” to include crypto trading itself.

The crypto trading would also mark a notable expansion for SIX, whose listing locations in Switzerland and Madrid have hosted two of Europe’s biggest IPOs this year – Spanish beauty group Puig and dermatology group Galderma.