The headquarters of the Swiss Stock Exchange (Boerse) operated by the SIX group is seen in Zurich on … [+] November 29, 2018. SIX was among the first traditional financial outlets to explore blockchain, and is preparing for a big launch.
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Swiss securities giant SIX Group is leading a $14 million series A investment into Omniex, an enterprise infrastructure provider building investing tools for institutional investors.
SIX had previously revealed an investment in Omniex, but the Series A announced today also includes investors Jump Capital, Wicklow Capital and Sierra Capital. While the valuation of Omniex isn’t being disclosed, SIX says it acquired a 12% stake in the company and a seat on the board of directors for it’s share in the round. A previous seed round of $10 million, brings the total amount raised $24 million. Omniex expects it will have a runway of “multiple years” based on the amount raised.
Launched in August 2017, Omniex is a technology company based in San Francisco that provides a tech stack to connect customers to aggregated asset pools at some of the largest exchanges in the world, including Binance, BitMEX, and Coinbase Pro, making it easier for institutions to make crypto deals most individuals wouldn’t be able to afford. Instead of “swiveling from screen to screen to screen to screen to figure out your position and try to do a trade,” as Omniex co-founder and CEO Hu Liang puts it, the company brings it all to a single location.
While Omniex plans to use the funds to build out its portfolio of institutional bitcoin investing tools, SIX is much more than just a strategic investor. Rather, SIX plans to use Omniex to connect its private banking customers to a wide array of digital asset investment opportunities.
“Going after the institutional space is quite different than going after the retail market where you can create a lot of things that hadn’t been done yet and be able to get to the client easily,” says Liang, who previously worked for 16 years at holding giant State Street. “Here, we’ve always said that we need to build a platform that looks and feels familiar to institutional investors, and we’re going to continue to put that infrastructure in place to reduce the fragmentation.”
Omniex has been operational since Q3 2018, providing aggregated liquidity from 15 exchanges, also including Bittrex, Bitfinex, BitStamp, Gemini, Kraken, itBit and Poloniex. Omniex selects its exchange partners to provide institutions a variety of investment opportunities from spot trade to unregulated derivatives, using a total of nine algorithms to identify investing opportunities. Included in the strategy are passive algorithms designed to protect investors from market conditions; benchmark algorithms looking to achieve volume or time-based objectives; and situational algorithms like the “iceberg algorithm” designed to mask large trades and minimize market impact.
In total, algorithm usage on large bitcoin purchases has increased in the last three months from 34% of the overall volume to 76%, showing what Liang believes is an increased desire for more sophisticated trade executions. “We focus on geographical differences, so the clients can have their choice,” he says. “Because we’re not a counterparty, it doesn’t matter to us.”
Existing clients include Polychain Capital, Blocktower Capital, Hyperion Decimus, Ledger Prime and Taurus Group. An early customer of Omniex, ARCA, confirmed it is no longer working with the company, but didn’t provide additional information as to why. While Omniex isn’t sharing revenue, Liang says the company has grown its total transaction volume by 581% from Q4 2019 to Q1 2020, but isn’t yet profitable.
Among Omniex’s newest customers is SIX Group, this round’s lead investor. Zurich-based SIX Group runs a massive portion of Switzerland’s financial infrastructure, from the SIX Swiss Exchange for stocks, to the central counterparty SIX X-clear and SIX Trade Repository, similar to the Depository Trust and Clearing Corporation (DTCC) in the U.S. Collectively, these products and others give SIX what its head of securities and exchanges, Thomas Zeeb, calls, a “value chain from trading, all the way through clearing and down to settlement.” SIX’s most recent financial filings show it generated about $220 million profit in 2019.
Now, after a delay that would have seen the new SIX Digital Exchange (SDX) for listing, trading, settling and custodying crypto-assets, launch last year, the parent company will use the Omniex liquidity services to connect its existing clients, especially banks, to massive pools of bitcoin scattered across the partner exchanges, Zeeb says. “Once the market and the regulators are ready, we will be moving from the existing infrastructure, tokenizing existing shares and bonds and stuff that we have in the central depository today in the traditional market into the new markets,” he says, including tokenized stakes in fine art and real-estate.
“Because you have SDX set up as a single entity that will allow you to go from trading all the way through to settlement in custody, you don’t have the various interfaces and breaks that you have with existing traditional platforms,” says Zeeb. “I fully expect that 10 years down the road we will move from the traditional structures into the digital structure.” SDX is scheduled to launch later this year.
Editor’s note: This story was updated to reflect more recent financials at SIX Group.
TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 239.24 points at 22,749.04.
In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.
The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.
The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.
The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.
This report by The Canadian Press was first published Sept. 6, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in technology, financial and energy stocks, while U.S. stock markets also pushed higher.
The S&P/TSX composite index was up 171.41 points at 23,298.39.
In New York, the Dow Jones industrial average was up 278.37 points at 41,369.79. The S&P 500 index was up 38.17 points at 5,630.35, while the Nasdaq composite was up 177.15 points at 17,733.18.
The Canadian dollar traded for 74.19 cents US compared with 74.23 cents US on Wednesday.
The October crude oil contract was up US$1.75 at US$76.27 per barrel and the October natural gas contract was up less than a penny at US$2.10 per mmBTU.
The December gold contract was up US$18.70 at US$2,556.50 an ounce and the December copper contract was down less than a penny at US$4.22 a pound.
This report by The Canadian Press was first published Aug. 29, 2024.
The crypto market has recently experienced a significant downturn, mirroring broader risk asset sell-offs. Over the past week, Bitcoin’s price dropped by 24%, reaching $53,000, while Ethereum plummeted nearly a third to $2,340. Major altcoins also suffered, with Cardano down 27.7%, Solana 36.2%, Dogecoin 34.6%, XRP 23.1%, Shiba Inu 30.1%, and BNB 25.7%.
The severe downturn in the crypto market appears to be part of a broader flight to safety, triggered by disappointing economic data. A worse-than-expected unemployment report on Friday marked the beginning of a technical recession, as defined by the Sahm Rule. This rule identifies a recession when the three-month average unemployment rate rises by at least half a percentage point from its lowest point in the past year.
Friday’s figures met this threshold, signaling an abrupt economic downshift. Consequently, investors sought safer assets, leading to declines in major stock indices: the S&P 500 dropped 2%, the Nasdaq 2.5%, and the Dow 1.5%. This trend continued into Monday with further sell-offs overseas.
The crypto market’s rapid decline raises questions about its role as either a speculative asset or a hedge against inflation and recession. Despite hopes that crypto could act as a risk hedge, the recent crash suggests it remains a speculative investment.
Since the downturn, the crypto market has seen its largest three-day sell-off in nearly a year, losing over $500 billion in market value. According to CoinGlass data, this bloodbath wiped out more than $1 billion in leveraged positions within the last 24 hours, including $365 million in Bitcoin and $348 million in Ether.
Khushboo Khullar of Lightning Ventures, speaking to Bloomberg, argued that the crypto sell-off is part of a broader liquidity panic as traders rush to cover margin calls. Khullar views this as a temporary sell-off, presenting a potential buying opportunity.
Josh Gilbert, an eToro market analyst, supports Khullar’s perspective, suggesting that the expected Federal Reserve rate cuts could benefit crypto assets. “Crypto assets have sold off, but many investors will see an opportunity. We see Federal Reserve rate cuts, which are now likely to come sharper than expected, as hugely positive for crypto assets,” Gilbert told Coindesk.
Despite the recent volatility, crypto continues to make strides toward mainstream acceptance. Notably, Morgan Stanley will allow its advisors to offer Bitcoin ETFs starting Wednesday. This follows more than half a year after the introduction of the first Bitcoin ETF. The investment bank will enable over 15,000 of its financial advisors to sell BlackRock’s IBIT and Fidelity’s FBTC. This move is seen as a significant step toward the “mainstreamization” of crypto, given the lengthy regulatory and company processes in major investment banks.
The recent crypto market downturn highlights its volatility and the broader economic concerns affecting all risk assets. While some analysts see the current situation as a temporary sell-off and a buying opportunity, others caution against the speculative nature of crypto. As the market evolves, its role as a mainstream alternative asset continues to grow, marked by increasing institutional acceptance and new investment opportunities.
