Former Wall Street trader Bart Smith is so knowledgeable about the digital currency industry, he was recently crowned “Wall Street’s Crypto King” by CNBC. So, when King Bart say he’s optimistic that institutional investors will throw money at the crypto market once it has regulated clarity, you know it’s true!
Bart Smith is CEO and founder of Susquehanna International Group, a digital assets company based in Pennsylvania, which has been at the forefront of Bitcoin trading since 2014. Four years ago, Susquehanna International first launched what has become a highly successful online crypto trading desk. At any given time a dozen traders are available deal with client transactions, and these traders buy and sell Bitcoin and other cryptos worth hundreds of millions of dollars on a daily basis.
As Smith recently told CNBS in an interview:
“We have a dedicated team of traders and technologists. We’ve been trading bitcoin primarily, but in 2017 as the marketplace expanded, we expanded the number of coins we were trading and the number of exchanges we were providing liquidity on.”
“We are trading on average a couple hundred million dollars a day [on bitcoin futures] across CME and CFE combined that’s not retail.”
When It Comes To Regulations – Quality Over Quantity
— CNBC’s Fast Money (@CNBCFastMoney) June 6, 2018
— CNBC's Fast Money (@CNBCFastMoney) June 6, 2018
Smith says too many hardcore crypto fanatics focus too much on whether or not there should be regulations, and far less so on the quality and clarity of any regulations. It makes sense to have a few, easy to follow quality regulations, than to be regulated out of existence. Once these regulations are in place and the companies follow them, institutional investors will come a ’calling.
As Smith said:
“There’s a big debate going on about whether there should be more or less [crypto] regulation. From our standpoint, it’s really about regulatory clarity. There has been a tremendous amount of focus on the SEC and Chairman Clayton’s comments. But it’s really a whole host of other regulatory agencies out there, because the ecosystem expands beyond the traditional financial assets.”
“[Regulatory] clarity will allow institutions to come in more than anything else because institutions don’t like to invest into uncertainty. So we’re just taking the most conservative approach that we can.”
“We’ve been advocating for an ETF,” he said. “We think it checks lot of the boxes for regulatory concerns, specifically as it relates to retail investors. And it checks a lot of boxes for institutional customers as far as custody and taxation and anti-money laundering and know-your-client [issues].”
Smith said if crypto bulls want to make bitcoin ETFs happen, they must ensure they meet regulatory muster as outlined by SEC chairman Jay Clayton. “Chairman Clayon has made his concerns very clear, and it’s up to us in the ecosystem to address those concerns,” he said.
When asked if there’s a correlation between the stock markets and the crypto space, Smith said he doesn’t think so, despite reports that have shown a correlation between their movements.
“We have not seen much correlation at all between the equity and bitcoin markets,” Smith said. “Trading cryptocurrencies is way more analogous to other asset classes than you might think from a market maker’s perspective, managing risk and the operational sides of it. But as far as the investor demand for it, and what drives bitcoin and other cryptocurrencies, we have yet to find much analogy in the driver of it.”
Smith said that what drives bitcoin prices differs from what moves the equity markets because crypto is not an institutionally-driven marketplace like the S&P 500.
As for bitcoin’s wild price swings, Smith said BTC is trading solidly in the range of $6,000 to $9,000 — at least for now.
Looking ahead, Smith is exceedingly confident in the future of crypto, as CCN has reported. “We believe that this technology and this asset class is going to change some facet of financial services, and we think it is going to exist forever,” he said.