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In Samuel Beckett’s Waiting for Godot, the main characters spend the entirety of the play anticipating the arrival of a figure by that name. The characters—and the audience—wait and wait some more, but, in the end, Godot never turns up. The plot of the play might feel familiar to crypto players, who have predicted for years that banks and other financial institutions will transform their industry. That key moment is always just around the corner but never arrives.

I recently spoke with David Mercer, CEO of LMAX Group, a London-based firm that provides trading services in forex, crypto, and other assets to big institutions across the globe. The firm also does brisk business on its crypto exchange, LMAX Digital, which caters to institutional traders who want to carry out large, discreet trades. So far, though, big banks have yet to come in a meaningful way.

“I’ve got 35 of the top 40 banks trading fiat. In 2018, I assumed they all would have come into crypto by now, but what’s happened is banks won’t actually come,” Mercer notes.

He says this is not due to a lack of will or knowledge. Mercer notes that banks have invested billions in blockchain tools—including JPMorgan’s Ethereum-derived Onyx service—and that they are keen to trade Bitcoin and other major cryptos just as they would another asset. But Mercer points to Securities and Exchange Commission accounting guidance that precludes this.

Namely, if a bank like JPMorgan wishes to hold crypto assets on behalf of its customers, it must carry them on its balance sheet as liabilities—a different rule than for other types of customer assets under their custody, which don’t appear on the balance sheet at all. The upshot is that, since banks must hold cash reserves to offset liabilities, the SEC rules make it too capital-intensive to offer crypto custodian services.

The SEC reportedly never consulted the banks about accounting guidance even though a number of them had been preparing to offer crypto services to their clients. This seems to provide yet more evidence the U.S. has it in for crypto as a whole.

“It’s not banks saying no to crypto, it is U.S. regulators,” says Mercer. “The U.S. normally stands for innovation in capital markets, but it’s kind of on its own when it comes to crypto.”

Meanwhile, LMAX Digital is still doing half a billion dollars’ worth of institutional crypto trades per day, down from $2 billion a day during the height of the 2021 bull market. And Mercer believes that Godot, in the form of crypto-trading banks, will eventually arrive—just not this year.

Jeff John Roberts
jeff.roberts@fortune.com
@jeffjohnroberts

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Twitter is partnering with the brokerage app eToro to add crypto and stock trading to its platform. (Fortune)

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