The investment arm of UK-based pension fund M&G has invested $20 million in the country\u2019s first regulated Bitcoin (BTC) derivatives exchange, Global Futures & Options Holdings (GFO-X).<\/p>\n
An announcement from M&G and GFO-X outlined the investment details, which forms part of a $30 million Series B funding round for the derivatives exchange. The platform will initially offer clearing of Bitcoin index futures and options contracts.<\/p>\n
The move provides a platform for traditional finance institutions to gain exposure to various cryptocurrency derivatives investment products. GFO-X is set to become a Financial Conduct Authority (FCA) regulated and centrally-cleared trading platform for crypto derivatives.<\/p>\n
The investment capital stems from M&G\u2019s Crossover strategy, which was seeded from a series B funding round that draws from the $138 billion Prudential With Profits Fund. The Crossover strategy is aimed at \u201cpatient growth equity\u201d to fast-growing private companies.<\/p>\n
Related:\u00a0London Stock Exchange seeks digital assets director<\/em><\/strong><\/p>\n The funding aims to create a hub for trading and clearing cryptocurrency derivatives and fostering innovation in the sector. Part of the investment sees M&G join the board of GFO-X.<\/p>\n A statement from M&G portfolio manager Jeremy Punnett highlighted the potential for the UK and London to become a leading destination for cryptocurrency technology and investment.<\/p>\n \u201cThe lack of regulated trading venues is materially hampering the growth of the digital currency trading market,\u201d Punnett added.<\/p>\n Related:\u00a0UK FCA gives unregistered crypto firms \u2018final warning\u2019 on ads regime compliance<\/em><\/strong><\/p>\n GFO-X CEO Arnab Sen added that evolving UK and European regulations will help cryptocurrencies edge their way into mainstream finance offerings. Still, this eventuality depends on integrating traditional market structures to address perceived risks associated with the emerging asset class.<\/p>\n \u201cHowever, building a regulated financial market ecosystem is complex, time-consuming and expensive, and the pitfalls of taking shortcuts are now clear for all to see,\u201d Sen said.<\/p>\n As investors continue to show interest in cryptocurrencies, the FCA recently issued additional guidelines to industry service providers to ensure compliance with\u00a0UK crypto-asset promotion rules. Some operators have opted to leave the country, while others have endeavored to meet strict requirements to advertise in the UK.\u00a0<\/p>\n