What to know:
- SBI, which owns 90% of B2C2 since 2020, has held talks with potential buyers but no deal is confirmed.
- B2C2 provides liquidity to institutions and exchanges. A sale could affect spreads and risk, highlighting the role of regulated firms post-FTX.
- Since 2022, tighter rules and the FTX collapse pushed firms like B2C2 and Wintermute to meet higher standards.
SBI Holdings, the Japanese banking empire, claims it is exploring a number of business choices for B2C2, the London headquartered cryptocurrency exchange maker, they hold the majority control.
Per a report by @willcanny99, the company has discussed the sale of B2C2 to various prospective bidders in the last eighteen months. A market trend with a much deeper institutional motivation is also being revealed here.
Market Makers Become Infrastructure
It was SBI Holdings that bought 90% stake of B2C2 in 2020. B2C2 has engaged with several potential buyers, But nothing has been confirmed yet. They give away off – the – counter and electronic liquidity across spot, derivatives, and stablecoins markets to institutions, exchanges, and asset managers.
Source: SBI
This trend is showing that the market-making firms today will be a part of the core infrastructure rather than being the trading desk alone.
Also Read: SBI Holdings Expands Asia Crypto Footprint With Majority Acquisition of Coinhako
Ownership Shift Risks Market Stability
Liquidity providers are very important for the crypto markets because they make the price movements transparent through centralized exchange and DeFi platforms.
A change in company ownership could bring a number of negative effects like bigger spreads, execution problems, and higher counterparty risks for institutional and fund clients. For SBI Holdings, selling out or just a partial withdrawal would mean an end to their crypto department building effort which has included, among others, SBI HoldingsVC Trade and Ripple partnerships.
Acquiring firm-wise B2C2 is a regulated entity Besides having already established banking channels, which together create invaluable assets to the clients. These are In particular critical at a time like after the FTX fallout when trust and regulation go hand-in-hand.
Also Read: Bitcoin ETF Could Launch in Japan by 2028 Under New Crypto Rules
From Crisis to Regulation
Around mid-2022 when the situation started unfolding in DeFi, there were quite a few liquidity providers who took the initiative and started offering crypto services through centralised exchanges or DeFi venues. Some of the liquidity players at that time were B2C2 Fidello Alameda Research, Genesis, and Wintermute.
Later on, the regulators in various jurisdictions tightened the control of liquidity, forcing the market-makers to raise their standards. The liquidity players also experienced significant losses in some DeFi projects. Yet, the situation was even worse with the collapse of FTX.
Also Read: Clarity Act Moves Closer to Final Senate Vote as US Crypto Rules Advance
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