Top Headlines

Cleared British FX Traders Put US Justice on Trial – Financial Times (subscription)

Now, among many other emotions, they are angry. They are asking why, out of all the hundreds of currencies traders in the City of London, they were picked out for a criminal trial. The traders and their lawyers struggle to understand how the long arm of US law can justify trying them away from home based on “hypothetical” victims and the testimony of a single former friend that failed to withstand scrutiny at trial.

How Are FX Platform Operators Enforcing Their Rulebooks? (opinion) – Profit & Loss

The FX industry is advancing how it deals with certain issues, but the pipeline of areas in need of clarification and further debate shows little sign of slowing down. Two areas of concern are how platformoperators are enforcing their rulebooks – are they being fair and balanced to both LPs and LCs? – and exactly what constitutes “full amount”trading? An open and data-backed discussion will solve the latter, but I wonderif we need an industry ombudsman for the former?

In the FICC of It (podcast) – Profit &Loss

The last week has seen the return of volatility to crypto markets, which has at least got one of the podcasters excited. The podcasters look at potential use cases for thetechnology underpinning the crypto space, liken it to the e-FX boom thataccompanied the launch of Profit & Loss, before moving on to discuss thechanging attitude of customers to FX markets.

Citigroup, JP Morgan to Pay $182.5 Million to Settle Rate-Rigging Lawsuit – Reuters

Citigroup and JP Morgan will pay $182.5 million to settle US investor litigation claiming they violated antitrust law by conspiring with other banks to rig a key European interest rate benchmark.

Investment Banks’ Secret Cash Cow – The Wall Street Journal (subscription)

Investment banks have made a nice little money-spinner out of a once broken trading strategy: The repo. But now that the secret is out, it risks losing its force.

How Traders Trade When Treasury Markets Get Volatile – Greenwich Associates

While the future of the bull market remains top of mind for most, we find the impact of market volatility on e-trading much more fascinating to explore.

Independence Day: Separation Brings Value for Fintech Spinoffs – Inside Market Data (subscription)

Financial firms with a data or technology ‘vendor’ arm developed in house are finding that separation can benefit both business lines.

Regulatory News

FSB Publishes Final Report on Compensation – Profit & Loss

The Financial Stability Board has published its finalised Recommendations for national supervisors: Reporting on the use of compensation tools to address potential misconduct risk. The work started in 2015 when the FSB published its work plan on measures to reduce misconduct risk through the promotion of incentives for good behaviour.

As Brexit Looms, Mifid Transparency Faces the Chop – (subscription)

Implementing Europe’s Mifid II has not exactly been a walk in the park. But Brexit will make it harder still, as some of the wide-ranging trading rules look set to break into a UK and a European Union version. Financial firms fret this will happen to pre- and post-tradetransparency requirements contained in Mifid II’s companion regulation Mifir.

Paris Eyes Slice of Derivs Clearing Business Post-Brexit – Global Investor (subscription)

The vast bulk of euro-denominated derivatives clearing – around 70 percent – takes place in London.

FCA Launches Further Consultations Ahead of the UK’s Exit from the EU – FCA

The Financial Conduct Authority (FCA) has published a further consultation on its approach to the UK’s exit from the EU. The paper sets out additional proposals to prepare for the possibility the UK leaves the European Union on 29 March 2019 without an implementation period.

A Creator of the UK’s Libor Replacement Says It’s Still Too Complex – Bloomberg

As banks prepare tomove away from the scandal-tainted London interbank offered rate, few in the city of London will be watching more closely than William Porter.

Crypto News

Bitcoin Extends Falls as Selloff in Crypto Currencies Resumes – Reuters

Bitcoin extended its falls on Monday to $3,843, down more than five percent from the day’s highs onrenewed selling in cryptocurrencies.

Galaxy Digital’s Mike Novogratz: Cryptocurrency Markets Will ‘Flip Next Year’ – CoinTelegraph

Mike Novogratz, ex-Goldman Sachs partner and founder of Galaxy Digital, has said that he expects cryptocurrency to “flip next year”.

UK Financial Conduct Authority Investigates Firms Over Cryptocurrency Non-Compliance – The Telegraph (subscription)

As the price of the controversial cryptocurrency Bitcoin plunges, new figures show that the City watchdog is stepping up its investigations into the murky sector.

Company News

DrumG: Using Tomorrow’s Technology to Solve Today’s Problems – Profit & Loss

It is something of an attention-grabber when someone who builds solutions on distributed ledger technology says, “We are not a blockchain company”, however that is exactly how Tim Grant, co-founder and CEO of DrumG, starts our conversation.

Saxo Hires Hovard – Profit & Loss

Saxo Bank has announced the appointment of Thomas Hovard to the position as COO of global distribution and client services, effective from 4 February 2019. He will report directly to Damian Bunce, chief commercial officer.

UK Competition Regulator Investigates Nasdaq’s Cinnober Acquisition – The Trade

The UK’s anti-trust regulator has confirmed that it is investigating Nasdaq’s recent bid to acquire Swedish exchange and clearing technology provider Cinnober.

Market Savvy

Investors Say Markets Unlikely to Help Theresa May on Brexit – Financial Times (subscription)

Fund managers question whether sterling will plunge should MPs reject PM’s deal.

Italy, Oil Rebound Lifts Euro Towards Recent Two-Week Highs – Reuters

The euro advanced towards a two-week high on Monday as risk appetite picked up thanks to firmer oil prices, and news that Italy may cut its budget deficit target to placate the European Union.

Europe Warily Eyes US-China Spat at G20 – Financial News

Eighteen leaders of the world’s largest economies will gather in Argentina this week to watch two heavyweights duke it out in a diplomatic ring. Heads of state and leaders from Europe, Asia and the Middle East will take their seats around the arena, and wait for US President DonaldTrump and his Chinese counterpart Xi Jinping to signal where their trade war is heading. 

Ukrainian and Russian Assets Hit By Rising Crimea Tension – Financial Times (subscription)

Most serious escalation in four years spooks investors.

Goldman Models Impact of Rate-Shock Scenarios on Markets – Bloomberg

Goldman Sachs economists have proposed some “rules of thumb” for the impact of Federal Reserve interest rate hikes on financial conditions and the US economy, which showcase the importance of policy makers’ communications.