Report: Former Bitmain CEO Working to Create “Biggest OTC (Crypto) Desk…Overnight”

Jihan Wu, departed CEO and co-founder of the world’s largest crypto-mining hardware producer, Bitmain, will launch an OTC cryptocurrency custody and trading desk called Matrix within a month, sources to  The Block report.

The unnamed commenters also believe the exchange will have a tremendous advantage in Asia given that the company will likely have direct wholesale access to “crypto assets” mined by Bitmain.

“Put it this way, they will be the biggest OTC desk and asset-manager [in the world] overnight,” said a source who works with local investors. “With liquidity like that, [low] prices follow…(and Asian markets are) a lot more price sensitive.”

The news is interesting because media and pundits had previously speculated that Wu’s departure from Bitmain may have been acrimonious.

In mid 2017, Wu teamed up with early Bitcoin entrepreneur Roger Ver to launch “a fork” of Bitcoin called Bitcoin Cash, and, according to rumour, sold a large amount of bitcoins to buy volumes of Bitcoin Cash and/or bankroll the network.

Bitcoin Cash is an alternate version of Bitcoin that relies on big blocks for scaling.Ver insists that Bitcoin Cash is “the real Bitcoin” according to “Satoshi’s (the inventor of Bitcoin’s) vision.”

For the first 6 months after it was created, Bitcoin Cash tracked Bitcoin’s price steadily around 10%, but currently trades at around 5%.

Bitmain also reported a loss of $500 million USD in Q3 2018, which likely resulted from a decline in hardware sales that was a side effect of price contractions across cryptocoin markets.

Matrix services will reportedly be available to all but American investors, and sources believe the company may be tolerated by Chinese, officials, who have otherwise and on paper pursued a total ban on cryptocurrency trading.

“It’s more of a ‘if we can’t beat them, how do we direct them’ attitude,” said the source regarding the Chinese government while adding that a nod of approval has not yet been granted.

Once launched, Matrix could be a huge competitor to Coinbase and BitMEX, The Block writes.

According to another source:

“This is going to make Asia the new centre of gravity for crypto OTC.” 

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