EDX Markets, a cryptocurrency exchange with backing from major Wall Street players such as Citadel Securities, Fidelity and Charles Schwab, officially launched on Tuesday.
See related article: SEC lawsuit sees Binance.US wobble, trading platforms delist cryptos
Fast facts
- The New Jersey-based exchange will offer Bitcoin, Bitcoin Cash, Ethereum and Litecoin trading services. These four cryptocurrencies are among those not named as securities by the U.S. Securities and Exchange Commission.
- In addition to its launch, EDX has completed a new funding round from investors, including options exchange operator Miami International Holdings and affiliates of proprietary trading firms DV Trading, GTS, GSR and Hudson River Trading, the exchange said in a press release on Tuesday.
- EDX said it plans to introduce a clearinghouse later this year to facilitate the transactions and exchange of payments.
- The firm describes itself as a non-custodial exchange or a trading platform that does not directly handle customers’ digital assets. Instead, it has adopted a model similar to traditional stock markets where brokerage firms book orders from investors, as reported by The Wall Street Journal.
- The risks intertwined with custodial models became evident last year with the collapse of the Bahamas-based exchange, FTX. The U.S. SEC also leveled allegations against Binance, the largest cryptocurrency exchange in the world, accusing it of mixing customer assets.
- EDX’s launch comes amid the SEC’s intensifying scrutiny of major cryptocurrency exchanges, including U.S.-based Coinbase and Binance.US, for alleged breaches of securities rules.
See related article: The SEC has spoken: The future of finance is not in America