Money.Net brings you Crypto First....

"If you ain't First your Last" Ricky Bobby

By Alexander Osipovich Jan. 18, 2018 5:30 a.m. ET

The owner of the New York Stock Exchange is launching a service to bring bitcoin data to hedge funds and other professional trading firms, the latest sign that the once-fringe market for cryptocurrencies is being taken seriously by Wall Street.

Intercontinental Exchange Inc., ICE 0.29% or ICE, said Thursday that it was joining with startup Blockstream to launch a data feed that would pull information from more than 15 cryptocurrency exchanges around the world and deliver it to financial firms.

Due to go live by March, the feed would transmit information over ICE’s high-speed data network in the same digital format used in electronic stocks trading, helping it fit seamlessly into the systems favored by big banks, high-speed traders and asset managers.

The move could help draw more financial heavyweights into the risky, rapidly evolving world of bitcoin. Invented less than a decade ago, the digital currency was long a niche product favored by libertarians and software geeks. But an extraordinary price run-up last year helped put it on Wall Street’s radar.

Bitcoin was trading at $11,387.28 late Wednesday afternoon, down more than 40% from its record of $19,783.21 in December, according to research site CoinDesk.

ICE’s plan would also represent a big step forward from the way many bitcoin investors now monitor prices and trading activity. Reflecting its hacker roots, the cryptocurrency community relies heavily on various websites that often have a homegrown feel and don’t necessarily identify their creators or announce when they make changes.

That can cause problems. Last week, a move by the popular website coinmarketcap.com to remove data from some South Korean exchanges briefly caused chaos in the crypto markets, erasing tens of billions of dollars from many of the biggest digital currencies over a 24-hour period. The website didn’t immediately respond to a request for comment.

ICE isn’t the first big-data player to wade into the crypto markets. Financial-information giants Bloomberg LP and Thomson Reuters Corp. broadcast the prices of major digital currencies on their widely used terminals. Money.Net, a lower-cost data vendor used by more than 1,000 banks, brokers and investment firms, expanded its coverage of cryptocurrencies this week to include data on hundreds of digital coins.

But ICE’s new service, called the Cryptocurrency Data Feed, aims to go beyond those offerings by providing more detailed data that could be used by high-frequency traders and quantitative hedge funds to power sophisticated trading strategies.

For instance, it will include information about the “order books” at cryptocurrency exchanges, revealing how much buying and selling interest there is in a digital currency at any time. Such data can reveal signals about potential market moves.

And by streaming real-time data from many exchanges, ICE’s data could help fuel arbitrage strategies, in which savvy traders try to exploit price variations across different marketplaces for the same asset. While such profit opportunities are fleeting in more mature asset classes, they are relatively abundant in crypto. During episodes of market stress in recent weeks, the price of bitcoin has varied by 10% or more at different digital-currency exchanges, crypto-market observers say.

The cryptocurrency exchanges supplying data for ICE’s feed have all agreed to work with Blockstream to support the initiative, said Adam Back, the startup’s chief executive and co-founder.

Lynn Martin, president of ICE Data Services, said ICE launched the new feed in response to heavy demand from data-hungry clients seeking to better understand cryptocurrencies.

“We’re receiving a lot of requests for information for anything that would provide transparency into this market,” Ms. Martin said. She declined to discuss which firms were expected to be the heaviest users of the new service.

Based in Atlanta, ICE is best known for owning the NYSE, which it acquired in 2013, as well as other exchanges and clearinghouses around the world. But it is also a growing player in the financial-data space. In 2016, 44% of ICE’s net revenues came from market-data sales and related fees, up from 9% five years earlier.

By focusing on crypto-market data, ICE is taking a different approach from rival exchange operators that have rushed to launch futures contracts based on bitcoin.

“We may be stupid for not being first on that,” ICE Chairman and Chief Executive Jeffrey Sprecher said at a financial conference in December, while also expressing doubts about the wisdom of his competitors’ hurry to introduce bitcoin futures.