Spectrum trading platform enters the crypto industry

Frankfurt The Frankfurt Spectrum trading platform will enter the cryptocurrency sector on Wednesday. Private investors can then use warrants to bet around the clock on the development of the most popular cryptocurrencies Bitcoin and Ether, as board member Alpay Soytürk told Handelsblatt. “We are the first European trading platform to offer crypto turbos that can be traded around the clock in a regulated environment.”

From his point of view, round-the-clock trading is particularly important for cryptocurrencies, “because there are always big price fluctuations there, even at night” – for example when the tech billionaire and CEO of Tesla, Elon Musk, Tweets About Cryptocurrencies Again. Spectrum customers could also respond late at night or early in the morning.

Turbos are financial instruments with which investors can bet on the rise or fall of the prices of the underlying assets with leverage. However, this involves considerable risks: if the underlying falls below or exceeds certain values, called knock-out thresholds, the securities lose their value.

Similar products and many other structured products based on cryptocurrencies have long been available from competitors such as the Stuttgart Stock Exchange and the Frankfurt Stock Exchange. However, these can only be redeemed there between 8 a.m. and 10 p.m.

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Spectrum wants to offer 20 crypto turbos initially. On Bitcoin and Ether, customers can bet on price going up with five products each and price going down on five products – each with different knockout thresholds.

Experts continue to warn of major risks in the crypto market, including potential total losses. They advise to only invest money in cryptocurrencies that you are prepared to lose. “The offer is aimed at a risk-averse audience – traders who want to profit from short-term price fluctuations,” Soytürk stressed. “On the other hand, you can also use the products for hedging purposes, i.e. to protect yourself against short-term price fluctuations.”

Spectrum wants to expand crypto offering

Spectrum is a so-called multilateral trading facility and is regulated by German financial regulator Bafin. The company started operations in the summer of 2019 and is part of the British financial group IG. He wants to steer customers away from long-established exchange operators with longer trading hours, lower costs and faster processes.

However, well-known brokers such as Comdirect and Consors have yet to join the Spectrum platform. German private investors have so far only been able to trade the products through German broker IG Europe, which, like Spectrum, is owned by IG. All products are issued by the subsidiary IG Raydius.

Spectrum recently won two external partners in Italian banks Equita and Intermonte. “Other brokers and issuers will be added soon,” Soytürk announced. Prior to joining Spectrum, he worked for Deutsche Boerse for approximately five years and for Boerse Stuttgart for two years.

Due to the continued great interest in cryptocurrencies, all trading places are concerned about whether and in what form they want to offer cryptocurrency-based products. The Stuttgart Stock Exchange, on which investors of the Bison trading platform can trade cryptocurrencies directly, is considered a pioneer in Germany.

Crypto investors currently optimistic

The trading places have hit a nerve with this: A recent survey released on Tuesday by US crypto firm Coinbase in cooperation with the Blockchain Center at the Frankfurt School of Finance shows that crypto investors in Europe are currently optimistic, although the market participants had to deal with significant price declines and relatively high volatility in the first quarter of 2022.

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56% of crypto-asset owners surveyed said they plan to increase their crypto holdings over the next 12 months. 33% want to keep their stocks, 11% say they want to reduce their stocks. “Cryptoassets are thus becoming more and more clearly a new asset class”, judge the authors of the report, which “is here to stay”.

At the same time, crypto product providers continue to struggle with potential customer uncertainty: a quarter of respondents who do not currently invest in cryptocurrencies said they lack “information relevant to the ‘investment”.

“The crypto industry still has a responsibility to better explain crypto-assets and minimize barriers for investors in different areas,” concludes Sascha Rangoonwala, Country Manager Germany at Coinbase. It is therefore important that “industry provides understandable information, learning opportunities and low-threshold access”.

After starting with products on Bitcoin and Ether, Spectrum is already flirting with expanding its range. “Other cryptocurrencies may follow later,” Soytürk said. “We are already looking at some of them.”

After: Acquisition in Switzerland: Deutsche Börse is betting more and more on cryptocurrencies

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