Crypto Enters Wall Street, Aussie Firm Goes Bust: Best of the Week

Catch up on last week's top stories.

Australian investment firm goes under

Sydney-based Halifax Investment Services, an investment management company, has taken down its website and is unresponsive to attempts to communicate. According to the website of the Australian Securities and Investments Commission, the firm has been assigned external administrators.

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Halifax is a subsidiary of Lloyds Banking Group, and its CEO also heads two other entities. One of these is an investment education website offering courses on how to trade effectively.

Morgan Stanley invests in technology company

Investment bank Morgan Stanley invested $15 million in Integral, a company that sells software for foreign exchange companies. The money came from a branch of the bank called Morgan Stanley Expansion Capital. Integral will use the money to expand its business.

CEO Harpal Sandhu said: “We look forward to partnering with Morgan Stanley Expansion Capital and leveraging their deep experience and global resources.”

The FCA investigates

The Financial Conduct Authority, the UK’s financial regulator, requested data from the country’s foreign exchange companies because it wants to assess the impact of new EU financial law. The laws came into effect three months ago.

The information request consisted of 46 questions covering areas such as customer numbers, financial status of customers, trading volumes, and percentage of clients that make a profit.

The regulator has not revealed the purpose of the request, and so some British companies are hoping that the move was a sign that the restrictive new laws may only be temporary for them.

The EU and offshore brokers

Foreign brokers operating inside of the EU are taking in between €2 and 3 million a month, according to sources with knowledge of the matter. At the same time, companies working in such jurisdictions can’t find a credit card companies willing to service them.

The reason that offshore jurisdictions (such as Vanuatu, Bermuda, Jersey and the Isle of Man) are cut is odd because they were blacklisted by the EU as a result of information made public by the Panama Papers. The reason that they are nonetheless attracting customers from Europe is that the EU recently enacted strict laws which prevent people from gambling irresponsibly with their foreign exchange trades.

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Coinbase courts Wall Street

Coinbase, the US’ predominant cryptocurrency exchange, is now officially serving financial institutions, opening a trading desk for big-money customers. This is part of a new direction which the firm is pursuing as it tries to maintain profitability in a depressed market.

A Coinbase spokesperson said that financial institutions are seeing the bear market as a good opportunity to buy shares; when asked if Coinbase has forgotten its normal customers, the answer was no: “Perhaps the revolution began on the retail side, and we absolutely love and respect and take care of our 25 million retail clients, but…we need diversity and we need new participants.”

Analysis: Wall Street invasion

Retail investors, that is, individual traders, are what drove the cryptocurrency market explosion in 2017. However now that their interest is waning, big companies are stepping in instead. Companies are now beginning to actively market to the latter.

But does this mean that the man in the street can no longer dream of a shiny Bitcoin to call his own? Do trading companies care about him any more?

In this analysis, Finance Magnates discusses this issue and has gathered opinions from a number of industry people. What are traders looking for? Which companies are providing for them? Read here and find out.

Analysis: the long arm of the law

Cryptocurrency is no longer the Wild West that it used to be, as governments around the world work on new laws to control the industry for the purpose of gathering tax and protecting the public. Even in countries where the government has been slow to react, companies themselves have banded together to create codes of conduct so as to convince the public that they are legitimate.

However many companies are not interested in being controlled, and set themselves up in obscure locations that don’t have any of these pesky laws. Is this a good business plan? Read this analysis and find out.

Analysis: anarchy in the UK?

The UK is lagging behind its first-world cousins in cryptocurrency legislation, in that it does not have any. A recent Treasury committee concluded that cryptocurrencies are but a fad, and with the recent market crash, they must feel gratified. But CryptoUK, a self-regulatory organisation, continues to fight for a place in society for blockchain businesses.

In this analysis, Finance Magnates looks at the direction that British law is taking, speaking to a number of relevant figures on the way.

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