How Does the Concept of “Prime Brokerage” Apply to Institutional Cryptocurrency Derivatives Trading?
Prime brokerage in crypto offers a suite of services, including consolidated access to multiple exchanges, collateral management, financing, and often, post-trade settlement. It allows institutional traders to manage their risk and capital efficiently across various trading venues without having to pre-fund each exchange individually.
The prime broker acts as a central counterparty for the client's trading activities. This model is crucial for managing fragmentation in the crypto market.
