TL;DR
- Tower Research Capital strengthened its commitment to cryptocurrencies through Limestone Trading, increasing capital and improving its quantitative trading infrastructure.
- Institutional presence in the crypto industry is gaining momentum due to favorable political changes and a more flexible regulatory environment.
- 86% of institutional investors plan to maintain or increase their exposure to cryptocurrencies before 2026.
Tower Research Capital decided to strengthen its presence in the crypto market through Limestone Trading, an internal unit specializing in quantitative trading.
This decision comes amid the institutional recovery for digital assets, a trend that has deepened due to favorable political changes and a more accessible regulatory environment in key markets like the United States.
Limestone Trading increased its capital allocated to cryptocurrency operations and optimized its technological infrastructure to operate more efficiently across exchanges worldwide. The team, composed of over fifty people spread across New York, London, Singapore, and Gurgaon, manages strategies such as arbitrage, spread trading, and market-making. The firm also started applying machine learning models to operate across multiple asset classes, allowing for faster, market-aligned decision-making.
Tower Sees It’s Time to Go All-In on the Crypto Industry
Tower’s decision was delayed in part due to an issue that began in 2022, when the collapse of FTX, Alameda Research, and regulatory conflicts with Binance caused panic across the industry. However, the arrival of Bitcoin-backed ETFs and signs of regulatory easing have reignited institutional interest in the crypto market.
Several traditional financial firms are adopting a similar strategy. Citadel Securities is evaluating offering market-making services on platforms like Coinbase, Binance, and Crypto.com. On the other hand, Jane Street has maintained a constant presence in the industry since 2017, while Jump Trading developed an exclusive digital asset division with active global operations.
The Proliferation of Institutional Investors
A recent report by Coinbase and EY-Parthenon confirmed this shift in trend. 86% of institutional investors surveyed confirmed they have capital allocated to cryptocurrencies or intend to add them to their portfolios before 2025 ends. Factors such as improved market infrastructure and greater legal clarity in different jurisdictions contribute to this increased interest.
According to Gadi Chait of Xapo Bank, volatility and the proliferation of memecoins with no real utility hindered deeper adoption for years. However, the diversification of products and development of new financial instruments are helping more investors recognize the varying levels of risk and genuine opportunities in the crypto market
