Standard Chartered is setting up a trading desk for Bitcoin and Ether, people familiar with the matter said, making it one of the first global banks to enter spot cryptocurrency trading.
The new crypto desk is close to starting operations and will be part of the bank’s FX trading unit, sources said, adding it will be run from London.
Banks including Goldman Sachs Group have been trading cryptocurrency derivatives for years, but strict regulations have kept them from dealing directly in the underlying assets.
In 2022, Goldman Sachs completed an over-the-counter crypto trade with digital asset financial company Galaxy Digital. According to reports, the trading desk will begin operations soon.
The Basel Committee on Banking Supervision has proposed that banks must apply a 1,250 per cent risk weighting to any unhedged crypto exposure, making it difficult to generate profits.
“We have been working closely with our regulators to support demand from our institutional clients to trade Bitcoin and Ethereum, in line with our strategy to support clients across the wider digital asset ecosystem, from access and custody to tokenisation and interoperability,” the bank said in an emailed statement.
Standard Chartered is among several large banks pushing deeper into crypto as institutional adoption of the asset class widens.
It owns stakes in two crypto firms, Zodia Custody and Zodia Markets, which offer services ranging from custody to over-the-counter trading.
In November, it launched a blockchain unit called Libeara to help institutions tokenise traditional assets. The unit is supporting the creation of a tokenised government bond fund using the Singaporean dollar.
The latest move comes as Bitcoin’s volatility has been subdued, down more than 20pc since the start of 2024 – mirroring developments in equities markets and squeezing profits at trading desks.
Bitcoin fell to the lowest since May 15 on Friday in London and is down about 14pc from its March record.
Even so, the wildly successful launch of US Bitcoin exchange-traded funds in January have boosted liquidity in cryptocurrency markets and given large institutions more confidence to push into digital assets.
The US Securities and Exchange Commission approved spot Bitcoin ETFs first, leading to a significant spike in the price of the cryptocurrency, which spiked to a high of $73,000 on the back of its approval.
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