In a significant milestone for the institutional foray into the world of digital assets, M&G Investments, the asset management arm of pensions giant M&G Plc, has recently made waves by investing $20 million in a UK-based crypto derivatives trading platform. The move represents a pivotal step in reinstating institutional confidence in the crypto market, following the collapse of FTX last year, as per a recent Bloomberg report.

Highlighting the significance of this investment, M&G Investments acquired the stake as part of a notable $30 million series B funding round for Global Futures and Options Ltd., known as GFO-X. The infusion of capital from M&G’s £129 billion Prudential With-Profits Fund underscores a growing interest among traditional asset managers in the crypto space.

GFO-X, in a strategic partnership with LCH SA, a subsidiary majority-owned by the London Stock Exchange Group (LSEG), is set to leverage LCH’s clearing service, DigitalAssetClear. This collaboration focuses on clearing Bitcoin (BTC) index futures and options contracts traded on GFO-X’s platform, aiming to elevate the efficiency and security of crypto derivatives trading by harnessing LCH’s established expertise in clearing and risk management.

While the market initially anticipated the launch of LCH DigitalAssetClear, along with the partnership with GFO-X, by the end of 2023, regulatory approval for LCH DigitalAssetClear is still pending. Despite this, a GFO-X spokesperson informed Bloomberg that the platform expects to be operational in the first quarter of 2024.

The move by M&G Investments signifies a notable shift in institutional support for digital asset infrastructure, following the collapse of the FTX exchange in November 2022. Traditionally prominent asset managers, including Ontario Teachers’ Pension Plan, Tiger Global Management, and Singapore’s Temasek Holdings, were compelled to write down their FTX stakes to zero, incurring substantial losses. With M&G’s entry into the sector, there is a palpable renewal of optimism and burgeoning confidence among institutional players.

This significant investment not only provides a substantial boost to GFO-X but also underscores the broader narrative of institutional acceptance and participation in the crypto derivatives market. As regulatory frameworks continue to mature and innovative platforms like GFO-X gain traction, institutional adoption of crypto derivatives is primed to embark on a new phase of growth and development.

At present, the global cryptocurrency market continues to experience volatility following sharp price pullbacks, resulting in a market cap of $1.502 trillion. According to data from CoinGecko, this reflects a retraction of 5.59% in the last 24 hours, with a growth of 82.77% compared to one year ago. While various digital assets populate the market, Bitcoin (BTC) remains a dominant force, with a market cap of $811 billion and a Bitcoin dominance of 53.30%, underscoring its substantial share in the overall cryptocurrency landscape.

Disclaimer: The information provided in this research report is for informational purposes only and should not be interpreted as financial or investment advice. The NFT and cryptocurrency market is highly volatile, and readers should conduct thorough research before making any investment decisions.