Top Headlines

Brexit Spells Trouble for Europe’s €660tn Derivatives Market – Financial Times

As investors wait for the UK’s vote on the Brexit withdrawal agreement, banks and brokers have already accepted that, from March 29, Europe will be split into two distinct capital markets.

Banks Struggle to Break Up Trading Floor Boys’ Club – Financial News (subscription)

An image problem, the difficulty of making work flexible and the rise of quant trading are making the gender diversity quest an uphill battle.

HSBC Settles $250bn of FX Using Distributed Ledger Technology – Profit & Loss

HSBC has now settled more than three million FX transactions and made more than 150,000 payments worth $250 billion using distributed ledger technology.

Citi’s Trading Botch Says More About It Than Its Rivals – Bloomberg

A 21 percent decline in fixed-income revenue may not be an alarm for the rest of Wall Street.

Regulatory News

Theresa May to Warn No Brexit More Likely Than No-Deal EU Divorce – Financial Times

Theresa May will warn Eurosceptic MPs that Brexitt could be blocked by parliament if they fail to back her in Tuesday’s historic “meaningful vote” on her withdrawal agreement.

Brexit Takes Toll on Britain’s Financial Sector, Outlook Weak – Reuters

Uncertainty over Brexit and the economy have led demand for Britain’s financial services to shrink for the first time in five years, with no immediate sign of an improvement, a survey by business group CBI and PwC showed.

Basel Eases Capital Hit from New Trading Book Rules for Banks – Reuters

Revisions to global rules for bank trading books will result in a halving of the extra capital needed from January 2022 to cover risks from market price swings, the Basel Committee said.

Fintech Firms Want to Shake Up Banking, and That Worries the Fed – Reuters

The US Federal Reserve is wary of giving “fintech” firms such as OnDeck Capital or Kabbage access to the country’s financial infrastructure, putting the central bank at odds with other regulators looking to bring them into the fold.

Crypto News

How the US Government Shutdown Is Halting Crypto Progress on Wall Street – CoinDesk

The longest government shutdown in US history is hurting the crypto industry, too.

As the impasse in Washington stretches into its record-breaking fourth week, the closure of the Securities and Exchange Commission and the Commodity Futures Trading Commission has put key developments – namely, the approval and launch of products and services involving cryptocurrencies – on hold.

Bitcoin Futures Market Bakkt Makes Its First Acquisition – CoinDesk

CEO Kelly Loeffler announced Monday that the New York Stock Exchange–backed startup was acquiring “certain assets” belonging to Rosenthal Collins Group, an independent futures commission merchant. RCG had previously announced it was selling its customer accounts and brokerage business to British firm Marex Spectronn.

Crypto Exchange Goes Live on OTCXN – Profit & Loss

OTCXN, a blockchain-powered capital markets infrastructure company, has announced that Independent Reserve, a regulated cryptocurrency exchange that operates in Australia and New Zealand, has joined the OTCXN network.

Vontobel Unveils ‘Digital Asset Vault’ for Custody – The Trade Crypto

Investment bank Vontobel has launched Digital Asset Vault to allow institutions to offer their clients an end-to-end service for digital assets.

Company News

SGX Sees Strong Growth in FX Futures – Profit & Loss

Trading on SGX’s FX Futures more than doubled to $914 billion in 2018 as the exchange saw a record monthly volume of $96 billion traded in December.

LCH to Maintain Euro-Clearing Dominance: Berenberg – Global Investor (subscription)

Impressions that LCH’s de facto monopoly on interest rate swap clearing is at risk are misplaced, analysts claim.

Bumpy Ride Ahead for Cboe – Crain’s Chicago Business

For Cboe Global Markets, the new year is looking like the old one: turbulent.

TriOptima Compression Hit Record Levels in 2018 – Profit & Loss

TriOptima, a provider of multilateral compression services for OTC markets, set a new record for its triReduce portfolio compression service in 2018, having compressed $250 trillion gross notional value of trades at LCH SwapClear.

MarketFactory Secures Investment – Profit & Loss

MarketFactory has secured a strategic investment from Accel-KKR, a technology-focused investment firm based in Silicon Valley with over $5 billion in capital commitment.

FICC Takes Firm Grip of US Repo Market – (subscription)

Central counterparty wrangled more money market repo cash than banks did by end-2018.

Galy Joins Nordea Asset Management – Profit & Loss

Sebastien Galy has joined Nordea Asset Management as a senior macro strategist.

Market Savvy

Sterling Slips Off Multi-Week High, Volatility Spikes Before Brexit Vote – Reuters

Sterling slipped from two-month highs versus the dollar on Tuesday and volatility levels spiked as markets braced for parliament to give the thumbs-down to Prime Minister Theresa May’s Brexit deal later in the day.

German Slowdown Hits Euro – Reuters

The euro fell on Tuesday after data showed Germany’s economy slowed in 2018, underscoring fears about a broader slump in Europe.

No Currency, Just a Currency Crisis: Zimbabwe’s Woes Deepen – Bloomberg

Not having a currency of its own hasn’t stopped Zimbabwe from sliding into a currency crisis.