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cryptocurrencies

Chicago Wants to Be a Trading Hub for Crypto

  • Exchange Coinbase recently announced expansion in Chicago
  • City is home to traders, exchanges offering bitcoin futures

Chicago, long home to traders of everything from stock options to soybean futures, is increasingly adding cryptocurrencies to its domain.

More companies involved in the crypto world are likely to open offices in Chicago to capitalize on the growing trading market, said Peter Johnson, vice president of Jump Capital, a venture capital firm affiliated with Jump Trading. Johnson cited the recent announcement by Coinbase, a cryptocurrency exchange, that it’s expanding in the Windy City.

“Chicago is really starting to establish itself as the trading hub for crypto,” Johnson said Tuesday at a luncheon panel sponsored by the Executives’ Club of Chicago.

The city is home to large trading firms such as Jump and DRW Holdings which are active in cryptocurrency trading, along with exchanges CME Group Inc. and Cboe Global Markets Inc., which offer bitcoin futures trading. The biggest New York banks have been slower to embrace the new asset class because of concerns about volatility and reputational risk.

Coinbase is trying to attract more institutional traders to its exchange with plans to introduce low-latency on its exchange and a colocation offering, which allows traders’ computers to be close to the trading platform and make it faster to trade. That’s pushing the firm to branch out from its base in California.

San Francisco is “more focused on technology,” Sunil Cutinho, president of CME’s clearing operation, said on the panel. “We’re more focused on markets.”

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