178 Exchange Invest Weekly Podcast January 28th, 2023
This week in the parish of bourses and market structure:
As FTX looks to Lazarus?
And SBF is threatened
As we enter The Year of the Rabbit! Happy Lunar New Year everyone!
My name is Patrick L. Young
Welcome to the bourse business weekly digest
It’s the Exchange Invest Weekly Podcast Episode 178
Good day ladies and gentlemen, this is a very brief reduction of highlights amongst the key headlines from the week in market structure. All the analysis of the many events and happenings from the past 7 days can be found in Exchange Invest’s daily subscriber newsletter, the unique guide to the bourse business sent daily to your inbox.
More details at ExchangeInvest.com.
Asides from the bankruptcy proceedings enveloping Crypto Lender Genesis, this week in Exchange Invest’s unique Bitcarnage coverage we discussed the God mode in the tech at FTX and wondered whether that was a sound basis for a resurrection, which has been suggested by the current CEO and liquidator John J Ray III.
The God mode itself is quite common in computer games. SBF played a lot of computer games (often during FTX meetings) and indeed, from his many recent utterances appears a tad messianic. Thus an exchange with God mode might appear ludicrous to we practitioners of classical exchanges but to a boy king sun God…it’s not a question of guilt or no guilt, this was a return to pure play divine right governance.
Meanwhile, SBF is under threat. The New York Post notes a Car Drove Into Barricade Outside Sam Bankman-Fried’s House while apparently shouting ‘You won’t keep us out’ to a security guard who is an employee of the SBF family. This sort of intimidating behaviour is grotesque and we need the justice system to do his thing and jail a guilty SBF if that’s why his trial concludes. At the same time, it raises an intriguing issue: Sam Bankman-Fried’s Family Pays $10k A Week For Armed Security, Sources Say, again mentioned in the New York Post.
Excuse me? The SBF family were alleged to be teetering on the brink of announcing bankruptcy just a few months ago, and yet they have sufficient funding for SBF’s high profile defence as well as $10k per week for security..oh, and it seems to have been Business class flights all the way bicoastally for hearings too by the way. (I have nothing against business class per say, it’s an essential tool for commercial frequent fliers, my point is the spending numbers appear to be adding up to more than the sum total of circa $350,000 in 2x law professors’ salaries…)
I have no interest in the vitriol against SBF, violence against him would be a travesty and I do sympathize that his parents are suffering a hideous stress but then again, they put their names on a $16 million Bahamian property, so they are not guil… oh sorry, not ought to read “by their own credo, they are entirely, guilt-free”.
Great article in Reuters this week, the excellent Huw Jones pins some analysis: Frankfurt STIRs up the euro clearing battle with London. Delighted to say that PLY himself was quoted there and it was a joy to manage to be mentioned: “Margin offsets remain the key problem as ICE has a broader pool of competing asset classes to offset than mono-currency Eurex” amongst the remarks attributed to my good self.
The LME CEO Matt Chamberlain is hopeful that he’s going to manage to get a reversion to Asian hours for nickel futures in the near future on the LME despite marked reluctance from the UK regulators at the FCA.
Fascinating news, the latest employment figures from Morgan McKinley suggests there are more workers in the City’s Financial Services sector than has been seen since 2007. A quite fascinating altogether #DespiteBrexit…and also, broadly ignored by the ‘mainstream’ media.
Elsewhere fascinating analysis from the Motley Fool. The Mottles are bullish collectively on (in alphabetical order) CBOE, ICE, and NASDAQ simultaneously . Thanks to the upcoming proposed payment for order flow reforms of the SEC.
It was a busy week for results in the parish. All the details were in Exchange Invest daily, the newsletter no person can afford to be without in capital markets and market structure. For the sake of this podcast, let’s look at some edited highlights.
Schwab released their Q4 earnings and overall:
2022 Revenues +12%
Q4 revenues +17%
The Indian Energy Exchange on the other hand didn’t manage to do quite so well. Its Q3 net profit dipped over 4% falling to $9 million.
There were record clearing volumes incidentally when the numbers were total up for the year at LCH with growth across services and regions; expansion of the offering of the unclear derivatives market also paying off.
In new markets, it was a clear busy week for new markets in the parish with all the information in Exchange Invest daily, the newsletter no person can afford to be without in capital markets and market structure. For the sake of this podcast let’s look at some edited highlights.
ARTEX have established, what they claim as, the World’s First Art Shares Exchange. Co-founded by His Sovereign Highness Prince Wenceslas of Liechtenstein (who’s serving as Chairman) and with some SiX plumbing as well as LSEG UnaVista support.
Perhaps most interestingly, in this venture, is the absolute absence of NFT acronym deployment. That moniker could be a victim of crypto V1.0’s demise. The one confusing element is that a multitude of ventures have already deployed ARTEX as a brand for some other form of art market (quite often on blockchains).
The City of Busan is going to establish a digital assets exchange, apparently, which contradicts previously where they were talking about doing a pure crypto exchange but then at the same time, it’s quite feasible that they decided they didn’t want to be so closely partnered with the likes of FTX, who was previously named in the freedom alongside Binance and Huobi as frontrunners to be the partners in the putative crypto exchange that is now being rolled out as either a digital asset or a digital commodities exchange, according to which news story you are reading.
In deals news it was a busy week for deals in the parish with them or covered in Exchange Invest daily once again. Reuters are going to create 100 jobs and reboot their paywall following a deal with the London Stock Exchange.
While the paywall remains frankly the apotheosis of media stupid, adding 100 new editorial posts across 4 key areas: financial markets, mergers and acquisitions, the energy transition, and data visualisation to bring stories to life will add a welcome angle for all of us to read albeit we probably won’t bother logging into or using a paywall on Reuters because we’ll have the opportunity to read it free via aggregators who are paying the Reuters subscription fees, such as NASDAQ, or Yahoo.
Black Knight’s shares were gaining this week because there’s news that there may be some divestitures coming in the ICE sale, but that would mean that the ICE acquisition actually goes through, which is something investors have been cynical about in recent months.
One thing investors have also been cynical about in recent times, is just who’s going to win in the future economy of fintech. That’s why my latest book “Victory or Death?” – Blockchain, Cryptocurrency, and the FinTech World covers precisely that topic. It’s published by DV Books and distributed by Ingram worldwide.
Meanwhile, while you’re waiting for your copy of “Victory or Death?” to arrive, check out our Livestream, Tuesday 6pm London time, 1pm New York time. It’s the IPO video live show. Catch the back episodes on Facebook, LinkedIn, and YouTube via IPO-Vid.
Our latest show was Why The World Needed A Fifth Options Exchange with Bruce Goldberg.
Product news this week, regulatory scrutiny has been driving growth in third party certification of green social and sustainability bonds through 2022 according to a report from ICE. On the other hand, that led us in Exchange Invest to ponder quis verificiet ipsos custodes, what might ponder, because the key issue and for example, carbon markets is the speed of certification. And clearly there may be issues with who is certifying the rush of green bonds lest we return to a classic greenwash equivalent to the AAA of everything approach within mortgage bonds pre 2008, for instance. That’s not to contradict the ICE report – it is welcomed that more are seeking certification. That concern may arise about certification quality and speed of delivery going forward.
In other product news, the Lagos Commodity and Futures Exchange is set to onboard Imota Rice receipts for trading.
ICE has launched ICE Digital Trade Documents (ICE DTD) to digitize paper based post trade and shipping processes for the energy industry.
Hurray! Hurray! Hurray! I say.
Finally another news from ICE in the product arena, ICE has launched a carbon neutral US electricity futures index.
Technology news this week, Nasdaq Private Market (NPM) have acquired premier private company data products
Equally, Thailand Futures Exchange PCL (TFEX) is aiming to implement a new trading system and uplift products and services to meet investor demand in 2023.
Then there’s a little surprise as we found that the recent CEO of FTX-US Brett Harrison admittedly he jumped ship quite a long while AKA weeks before the hit the fan around at FTX having already previously been unable to work for Sam Bankman-Fried thus Brett Harrison has announced a very handy $5 million seed funding round for his new trading infrastructure for global digital asset markets play Architect.
Regulation news this week, one big note, Nexo agreed to pay $45 million in penalties and cease unregistered offering of crypto asset lending products in the USA after being sued by the SEC. Given a horde of Bulgarian fraud squad members bashed the door down on HQ and Sofia last week, it’s kind of academic that this announcement is made but it looks as if the SEC have at least got their booty from the fine. And also, of course, they get yet another opportunity to push forward on their precedent that they’ve been suing across the board in the world of crypto.
Career paths this week, Matthias Zieschang and Tobias Vogel have been elected as chairman of the exchange councils of the Frankfurt Stock Exchange (FWB) and Eurex Deutschland, respectively.
Which leaves us only to note that it’s worth considering that #DespiteBrexit #DespiteCOVID and #DespiteALotElseBesides, the City of London Corporation reports that city jobs were up 15% in the four-year period from 2017 to 2021. Where those bitter losers (the Euro rejoiners) are still snarking that the city is finished and British financial markets are floundering. The truth is the city of London added roughly 75,000 jobs.
And on that mysterious and magnificent note ladies and gentlemen, my name is Patrick L. Young. I’m recording this week from the United Arab Emirates.
I wish you all a great week in blockchain, life, and markets.
Analysis: Frankfurt ‘STIRs’ Up Euro Clearing Battle With London
LME Says Recommended Nickel Reforms Could Happen Quickly
London Metal Exchange CEO Is Hopeful About Reverting To Asian Hours For Nickel
These 3 Stock Exchanges Stand To Benefit From SEC Trading Reforms
The Motley Fool
Schwab Released Its Q4 Earnings And Monthly Activity Report For December 2022.
Indian Energy Exchange Q3 Net Profit Dips Over 4% To Rs 77 Crore ($9m)
Record Clearing Volumes At LCH With Growth Across Services And Regions; Expansion Of Offering For The Uncleared Derivatives Market
ARTEX Establishes The World’s First Art Shares Exchange
City Of Busan To Establish Digital Assets Exchange: Report
Reuters To Create 100 Jobs And Reboot Paywall Following London Stock Exchange Deal
Editor and Publisher
Black Knight Gains Amid Report About Potential Divestures In ICE Sale
Regulatory Scrutiny Drives Growth In Third-Party Certification Of Green, Social And Sustainability Bonds In 2022, According To Report From ICE
Lagos Commodities And Futures Exchange Set To Onboard Imota Rice Receipts For Trading
ICE Launches ICE Digital Trade Documents To Digitize Paper-Based Post-Trade And Shipping Processes For The Energy Industry
ICE Launches Carbon-Neutral U.S. Electricity Futures Index
Nasdaq Private Market Acquires Premier Private Company Data Products
TFEX Aims To Implement New Trading System, And Uplift Products And Services To Meet Investor Demand In 2023
Ex-FTX US President Harrison Taps Coinbase, Circle For New Crypto Firm
Nexo Agrees To Pay $45M In Penalties And Cease Unregistered Offering Of Crypto Asset Lending Product
Matthias Zieschang And Tobias Vogel Elected As Chairmen Of The Exchange Councils Of The Frankfurt Stock Exchange And Eurex Deutschland