TradeTech FX USA: interview with Ivan Jelic, business development and analytics director at Finery Markets

TradeTech brings together the leading buy-side heads of FX and portfolio management to learn and discuss the latest pressing issues in the sector. The exclusive event line-up is filled with distinguished speakers, diverse panel discussions, and hands-on workshops designed to boost your trading and investment performance and drive greater end-to-end workflow efficiencies.

FinanceFeeds Editor in Chief Nikolai Isayev had the chance to set up an interview with Ivan Jelic, Business Development & Analytics Director of Finery Markets, at TradeTech FX. Finery Markets is a peer-to-peer wholesale marketplace powered by proprietary matching engine for better liquidity & execution quality.

What follows is a summary of our conversation.

Ivan, it’s great to see you. What are your thoughts on this TradeTech conference?

Nikolai, nice to see you here as well. Actually, I spoke to the organizers a few minutes ago. And they are quite excited because this is the first US edition of the TradeTech conference in the last few years, the last one was cancelled. So we are all quite excited about it.

Great. Can you tell us a little bit more about what Finery Markets provides in the industry?

Yeah, definitely. So we consider ourselves as a crypto native multi-dealer platform that enables institutions to access liquidity in the OTC market. Our platform has been live for over two years, and we currently serve more than 70 active business entities.

Can you tell us about the latest developments at Finery Markets, and are there any fresh initiatives in the pipeline?

Well, there are a lot of developments on the product side. We will announce here at TradeTech the joint study we prepared in conjunction with PwC, Switzerland. The report addresses crypto trading, comparing OTC trading platforms and centralized exchanges, each of which has its own sets of pros and cons.

Surprisingly, almost 50% of surveyed participants actually have already started trading or interacting with decentralized exchanges, which shows how far the institutions are willing to go into the crypto space.

So not only they are trading spot markets, but they also access it through decentralized exchanges, which is quite interesting. We surveyed almost 80 institutions. One of the interesting findings is that executional liquidity quality is one of the top priorities they are looking at when they select the venue they want to trade with.

And also, based on their responses, the current setup is not something that they’re satisfied with, which was certainly an unmistakable sign of a maturing market. We plan to publish this report on a yearly basis. So hopefully, we’ll be able to compare those results next year.

Cryptoasset moving too fast for clear regulation

In our discussion with Ivan Jelic, we spoke about the challenges surrounding the need for imminent regulatory clarity on crypto assets. The second part of that question was about what could happen in terms of the end-user or retail trader’s experience.

The crypto researcher acknowledged the highly fragmented regulatory landscape in relation to crypto-assets. He also highlighted the difficulties in providing certainty from a regulatory perspective.

“Within the EU, you have different rules than the US, Canada, UK, Asia, and other hubs in the world where the crypto adoption is starting out. However, I would say the regulatory landscape also shows signs of getting to a more mature level,” Ivan noted.

The second question is about how end users will benefit, for example, from using Finery Markets. So the first thing is definitely better conditions such as tighter spreads, lower fees, and better quality of the service, he added.

We see a lot of companies, brokers, Neo banks, especially in Europe, going down that road where they allow you to actually access cryptocurrencies, but not to withdraw it. So we are yet to see a more extensive adoption of that. Also, one sign that shows we are getting close to mainstream adoption is that many retail banks, some of the big ones, are now talking about crypto and some are already enabling access to their institutional clients. But once we get to the level of retail clients, then we have real adoption.

You spoke about execution and liquidity quality and how surveys show that this is one of the most important things for institutions to consider when they’re looking for a crypto venue. Do you think that execution and liquidity have evolved quite well, though, over the years?

Yeah, definitely a great question. And I would say even great timing. We are finalizing another research that analyzes the spreads on the centralized exchanges compared to those offered by Finery Markets, which in this case represents the OTC side.

When comparing the average spread, especially during volatile times, many interesting issues arise. There were many conclusions, but the most interesting one was that the spreads have been decreasing constantly throughout the past few years, which reflects much deeper liquidity and that more institutional flows are presented in. So, I would say that we as a market are maturing for sure. In which stage we are, I’m not quite sure, but the one thing that also shows progress in this area is that more and more OTC desks are popping up, and more trading volumes occur on the OTC markets.

Great. Well, Ivan, thanks so much for joining us. So we hope you have a successful conference. See you soon and good luck.