Episode 6 of Season 3 of The Scoop was recorded remotely with The Block’s Frank Chaparro and Catherine Clay of Cboe Global Markets.
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Cboe is a Wall Street powerhouse.
On a typical trading day, the exchange operator handles about a third of U.S. equity volumes. In derivatives, major Wall Street products such as the VIX and S&P 500 options trade hands every day through its venue.
Cboe is now trying its hand at the crypto market — again, that is. More than a year after it shuttered its bitcoin futures product, the exchange said that it would re-enter the market through a partnership with crypto data services provider CoinRoutes.
On today’s episode of The Scoop, Cboe global head of information solutions Catherine Clay lays out the firm’s ambitions to build out a business in crypto market data. Clay also touches on how Cboe’s plans set the stage for a wide range of tradable products, including a bitcoin VIX-like product to an exchange-traded fund.
“You can even think about creative indices that reflect portfolio allocations with digital assets as a component,” Clay said. “Bringing this real price data in for the creation and calculation of indexes falls very much in line with how we think about educating the investment sphere and giving people some idea about how to construct portfolios for crypto.”
For Clay, the relatively undeveloped state of the crypto data ecosystem harkens back to her time trading internet stock derivatives in the 1990s.
“It really reminds me of when I was a derivatives trader back in the late 90s trading the internet stock back then that were really volatility,” she said. “I remember standing in the pit where I was the lead market maker for Netscape and Double Click and you could imagine back then there was very little data available to understand where the derivatives—the options— listed on those underlying should be priced and traded.”
In this episode of The Scoop, Clay also discusses
- Her background as a derivatives market maker and how that history informs her view on the crypto world
- The use case of the real price data it is now distributing through CoinRoutes
- The importance of data and analytics for a robust crypto market
- The pent-up demand from issuers looking to create crypto products
- What Cboe’s next steps might be if the SEC approves a bitcoin ETF
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