With the bear market still in full swing, one would think there would be a slowdown in investment. On the contrary, says Vaibhav Kadikar, Founder & CEO of CloseCross, who claims larger deals have taken place so far and has high praises for Marea, Cumberland’s new trading platform.
You said that Marea, Cumberland’s new platform, will soon become the standard for trading. Do you think this transition will be rapid or a gradual one?
The Marea model will be used as a template to be replicated across other OTC trading platforms, setting a new bar for both convenience and transparency. The pace of this rollout is dependent on two factors: the clients and traders recognition of the benefits and, regulators driving the need for documented transparency. While regulatory change is a historically slow process, recent cultural shifts towards corporate transparency undoubtedly signal future focal points for lawmakers. Looking to the future, it would be remiss of financial services platforms like Cumberland to dismiss these influences, hence why the launch of Marea is likely to be the first in a new wave of OTC trading developments. Progressive companies recognise that either clients and traders get on board in setting new industry standards now, or potentially face the repercussions of regulators cracking down on transparency standards at a later date. Those that fail to do so will inevitably be left behind.
What long term changes you think will take place as a result of the increased use of platforms like Marea?
In the long run, the use of platforms like Marea will definitely help advance the perception, and thus the pace, of cryptocurrency trading in general. In addition to providing users with complete oversight of all variables and helping them to maintain control, the technological modernisation and inherent transparency of these processes in crypto market making will help to increase confidence in traders as well as inspire trust in the system from investors, regulators and the general public.
Crypto was, at a time, seen as a means of usurping the large financial institutions such as Wall Street. With this move, would you say the crypto industry is looking to beat the traditional institutions or work side-by-side with them?
Ultimately, crypto is only a means of exchange. While it can play a part in disintermediating entire value chains, including those of the major financial institutions, it can’t achieve this alone and trading crypto for profits definitely won’t bring us any closer to this scenario. For that, and to truly usurp large, established, incumbent institutions, we need real use cases that combine Distributed Ledger Technology (DLT) platforms, crypto as a means of exchange, and other technological and algorithmic advances.
In any case, as valid use cases gain traction and bring about the wider adoption of crypto and blockchain platforms, new-age financial institutions will gain a stronger footing in order to shore up their market positions. Usurping them will take time, however.
How do you think crypto demand has stayed high enough to warrant such a new platform despite the bear market?
Along with fragmentation and regulatory hurdles, volatility is a necessary step for the growth of a new ecosystem. Blockchain technology still holds enormous long-term potential, and these short term dips in demand do not warrant delayed infrastructure preparation. Like Cumberland preempting regulatory changes, we believe in the old adage that “today’s preparation determines tomorrow’s achievement”.
Could you tell us a bit about CloseCross?
Based in London, UK, CloseCross Ltd. is the developer of a multi-party, decentralised derivatives trading platform driving democratic participation. Multi-party derivatives trading represents a real paradigm-shift for the market, opening it up to participants from around the globe for whom traditional derivatives trading is both too expensive and too complex. By introducing simple 3-click-trading, helping to eliminate unquantified risks, and making trading 90% cheaper, CloseCross seeks to level the playing field for those wishing to participate in the $1,200 trillion financial derivatives market. Until now, the derivatives trading market has been dominated by long-established financial institutions that have restricted access to those with the appropriate trading licences. CloseCross uses blockchain technology to change this, and disrupt the status quo by permitting anyone access to this lucrative market.
Have you noticed any peculiar trading patterns since the bear market began or is it business as usual?
Larger deals are occurring in the market and it definitely seems that there is a significant amount of consolidation of crypto holdings going on. There are a number of reasons for this. For one, certain projects are making great strides in the development of their platforms, leaving others in their wake. Instead of playing catch-up, companies with sufficient reserves are seeking to gain an advantage by acquiring projects whose technology or platforms they admire. Look at Facebook’s recent acquisition of Chainspace for an example of this. This also highlights another facet of the current situation in the market. Larger, centralized entities are catching on to the promise of blockchain technology, and are eager to get a piece of the pie. Rather than starting their development work from scratch, it makes sense, both financially and in terms of time-spent, to make an acquisition that helps them to leapfrog their closest competitors.
What does your platform have in store for 2019?
CloseCross has already seen great development this year, raising $3 million USD from Amnis Ventures, a privately owned venture fund based in Houston, Texas in its investment round to transform the financial derivatives market. We are currently focused on obtaining regulatory licensing across key jurisdictions, including; Europe, UK, USA in order to begin offering CloseCross services to consumers. We are taking a two-pronged approach, engaging with white label partners who already have licensing, as well as attaining our own.