Bitcoin Global News (BGN)
April 11, 2019 -- ADVFN Crypto NewsWire -- Will Puerto Rico become the Malta of the Western Hemisphere? Known for its cryptocurrency friendly government stance, the small island nation has attracted numerous cryptocurrency businesses to establish offices on island. Puerto Rico, on the other side, may be taking preliminary steps towards this kind of attraction. The island will now be home to the San Juan Mercantile Bank & Trust International (SJMBT), a a financial institution catering to cryptocurrency using individuals and businesses.
The SJMBT is well beyond gaining licensing or pilot projects - they have already accepted a first client’s deposit. They were licensed last month as an international financial entity (IFE) by Puerto Rico’s Office of the Commission of Financial Institutions (OCIF). On the larger scale, the bank is a unit of Mercantile Global Holdings (MGH), highlighting the potential for continued growth for the industry on the island.
San Juan Mercantile Exchange (SJMX)
SJMX will be yet another institutional-grade electronic trading platform for digital assets, facilitated by SJMBT. The bank will provide custody and settlement services for both fiat and cryptocurrencies traded on the exchange. However, SJMBT is not insured by the U.S. Federal Deposit Insurance Corp. (FDIC). The looming presence of a U.S. relationship could impede cryptocurrency development on the island down the line, as the country’s president is currently focused on building a wall along the Mexican border.
This combination of companies, where custody and trading are held under the same roof will bring many benefits. The exchange will take into account customer balances on deposit at the bank when setting trading limits, allowing the bank to settle trades in real time.
“As more liquidity venues onboard with SJMX to trade digital assets, SJMBT will provide critical services, such as real-time settlement and account re-balancing, in support of our customers’ trading activities.” - Nick Varelakis, president and chief operating officer of SJMB&T.
Coming From Experience
MGH’s leadership includes veterans of well-known financial companies. Nick Varelakis is a former executive director of JPMorgan Chase for business architecture and transformation, and COO of Puerto Rico’s Noble Bank ( the company behind the Tether stablecoin). The MGH bank and exchange were founded a year ago by J. Robert Collins Jr., former president of the New York Mercantile Exchange, and a founder of the Dubai Mercantile Exchange.
“You have an account [on Coinbase] and you want to trade on Kraken, right? [But your trade] has to go across some other external network, either a wire system or the blockchain and make its way to offset your capital requirements of both those exchanges. What it allows the traders to do is on my screen, they can trade CME futures, CBOE futures and my cash…There will be what we call a Central Limit Order Book, you see all the orders, time priced priority.” - J. Robert Collins Jr
By: BGN Editorial Staff