Roy Keenan from Yarra Capital Management shares insights with James Dunn from The Inside Network on the role of active management. The Inside Adviser
After the Hayne Royal Commission many advisers decided to steer away from large dealer groups in favour of becoming self-licensed. In the last six months, however, that trend has taken an abrupt turn.
Fast-growing crypto exchange FTX gains AFSL, set to launch in Oz
Following the Senate inquiry and recommendations into the crypto sector, Australia is fast on its way to becoming a leading digital innovation hub in the world, attracting overseas crypto and digital companies alike.
This week, FTX, the world’s fastest-growing crypto exchange, announced plans to launch in Australia within weeks. 30-year-old founder Sam Bankman-Fried sank millions of his nearly $2 billion fortune to get ahead of the steady institutional interest in cryptocurrencies.
Bankman-Fried says, “We’re excited to bring FTX’s innovative products and services to the Australian marketplace. The establishment of FTX Australia should provide all our local clients with the confidence of trading on a registered and licensed platform. As in other jurisdictions within which we operate, significant resources have been allocated to proactively engage with local regulators. We look to be a participant in policy discussions globally and will seek to continue this same level engagement locally through FTX Australia, and we are encouraged by the important work being undertaken to establish a new digital asset licensing regime.”
The Bahamas-based FTX has already obtained Australian Financial Services Licence (AFSL) and has a small team in Australia that will double in size very quickly. The company is looking to hire developers, operations personnel and marketing team members. It regards Australia as being a well-regarded financial centre in the Asia-Pacific and an important exposure to growth. Australians have a long-standing reputation of adopting new technologies, particularly when it comes to financial services. The establishment of FTX Australia highlights FTX’s long-term commitment to the local market and represents the natural next step in the FTX’s global expansion.
While the local Australian boss has not been announced, Bankman-Fried, one of the most closely watched leaders in the global crypto sector, said FTX would be looking to appoint a team to support its issuance of over-the-counter derivatives including options, futures and contracts for difference over underlying digital assets and leveraged “tokens”.
The big plus with FTX is that will push towards “tokenisation” of stocks and physical assets. “Tokenomics” will not only become competition but can transform the ASX and the way companies raise capital, especially given the variety of NFTs (non-fungible tokens) and their adaptability.
As the Australian Financial Review puts it, “It lets traders – including unsophisticated retail traders – buy crypto assets with margin loans. FTX will lend traders as much as 20 times their investment. For example, traders could buy a $20,000 position in a crypto derivative with a $1,000 deposit. But the risk is large; given the volatility of crypto markets, one big price swing could prompt an automated margin call that could wipe out a trader’s position.”
Bankman-Fried has amassed a $US22.5 billion fortune through FTX, which is currently valued at $US32 billion. According to the AFR, “In January, FTX reported it was churning through $US15 billion a day in volume, and doubled its user base in the last three months of last year alone. It does not disclose user numbers, but these are believed to be several million.”
