Schwab, Fidelity and Citadel just released a new exchange for crypto trading. They have decided to keep the transactions internalised which makes it a Dark Pool similar to those in the stock market.
Here’s a link for more information: https://twitter.com/741trey/status/1592966924857901056?t=G5crWnpXs8S6eMo7tkoIrA&s=08
Now these Institutions already have a huge impact on price discovery in the stock market through getting transactions outside of lit exchanges and transferred into dark pools. Now that practice is already put to the extreme in the stock market.
This text according to investopedia:
But dark pools have grown so much over the years that experts are now worried that the stock market is no longer able to accurately reflect the price of securities. 1 While estimates vary, dark pools are estimated to account for up to 18% of U.S. and 9% of European trading volumes.
And these are self reported numbers so take those with a grain of salt.
I’m bringing this up because there was a theory here that got me thinking. What will the FTX hacker do with his wallet? Especially with the amount of eth he has. He could use his funds to short eth to oblivion, borrow against it and we would probably see a massive drop.
Now imagine when players like Citadel etc. Would User their funds for strategies like that. This is not out of questioning if you consider that their business model basically lies in shorting assets, especially Citadel. What’s your take on this?
Submitted November 16, 2022 at 04:32PM by Sidibadawiin https://ift.tt/04rkA2O https://ift.tt/Ngf9FbA
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