With New York becoming increasingly prominent as a Bitcoin center, Coinsetter, Wall Street’s low latency Bitcoin exchange today launched a new incentive program designed to encourage institutionally-capitalized market makers to bring substantial liquidity to Coinsetter’s order book.
With several high value venture capital investments in North American Bitcoin technology, and now Coinsetter’s initiative to court large institutional market makers in North America’s largest financial center, it is clear that Bitcoin has become etched as a permanent fixture in today’s mainstream market place.
Last month, Coinsetter surpassed competitors to become one of the largest United States-based bitcoin exchanges when measured by daily trading volume.
Since the company’s founding in 2012, Coinsetter has developed the only advanced trading technology for bitcoin that can support systems used by Wall Street and professional traders. In August, Coinsetter became the first Bitcoin company to release an institutional FIX 4.4 API, giving traders real-time access to Coinsetter’s exchange through their existing trading systems.
Coinsetter is now promoting participation in the bitcoin market to professional market makers by offering maker-taker pricing and a new equity incentive program beginning today. The “Market Making Equity Incentive Program” will set aside 10% of the company’s equity for distribution to institutionally-capitalized designated market makers (DMMs) who provide liquidity to Coinsetter’s order book. The program is inspired by strategies utilized in the early days of today’s most successful alternative trading systems and equities exchanges.
DMMs must trade via Coinsetter’s FIX API in order to be eligible for the program. Participation in Coinsetter’s equity will be granted based on two factors. First, DMMs will be rewarded for maintaining at least $300,000 of liquidity on Coinsetter’s order book. Next, DMMs will be rewarded for subsequent trading volume linked to execution from their market making quotes. DMMs must be qualified accredited investors, and any issuance of securities will be subject to applicable state securities laws.
Coinsetter CEO Jaron Lukasiewicz said, “I’m excited to bring the next level of professional market makers into the bitcoin space and provide additional value to those who are already active in it. By incentivizing active market making, this program will convert into deeper liquidity and tighter spreads for all participants in the bitcoin industry.”