New crypto exchange launches with Fidelity, Schwab, and Citadel as backers along with other investors.
EDX Markets (EDX), which is supported by Fidelity Digital Assets, Charles Schwab, and Citadel Securities, has announced that it has launched in the United States after developing its technology for the past nine months.
“I am proud to announce that EDX Markets (EDX) has successfully launched our digital asset market and completed an investment round with new equity partners,” wrote EDX Markets CEO Jamil Nazarali on LinkedIn. “EDX’s official launch allows our outstanding team to bring to crypto the same values and standards of competition, transparency, fairness, and safety that investors in traditional assets expect and enjoy.”
The new crypto exchange gained attention after it was created in September with investments from major traditional financial firms Fidelity, Schwab, Paradigm, Sequoia Capital, and Citadel, the latter being a former employer of Nazarali.
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The company stated that the launch of its digital asset market comes with a new round of funding, which includes investments from Miami International Holdings, DV Crypto, and GTS, among others.
The launch follows news from just last week that asset management giant BlackRock had filed paperwork with the SEC to create a spot bitcoin ETF.
One thing that sets EDX Markets apart from other crypto exchanges is that it does not hold customers’ digital assets. Instead, users will have to go through financial intermediaries to buy and sell crypto assets, similar to how trades are executed on the New York Stock Exchange (NYSE) or the Nasdaq (NASDAQ). Regulators like the different approach, Nazarali said, because they think it’s important that there’s separation between the exchange function and the broker-dealer function.
“What we’re seeing is that increasingly, investors want to trade through their trusted intermediaries, and that’s especially true post-FTX, which was supposed to be the leader in the digital market. If you can’t trust them, who can you trust?” Nazarali told blockchain in an April interview. “So people are falling back on the firms that have been around for a really long time and that have really stood the test of time, and that’s a really important tailwind for us.”
The company will launch EDX Clearing later this year to settle trades matched on EDX Markets.
Currently, the exchange only offers four tokens: bitcoin (BTC), ethereum (ETH), litecoin (LITE), and Bitcoin Cash (BCH), partly due to the unclear regulatory landscape in the United States.
“We have a limited set of tokens because until there is more regulatory clarity, we don’t want to trade something that’s potentially a security,” Nazarali said in April. “Regulators really like that we don’t take that risk.”
While EDX Markets will consider international expansion “down the line,” for now, it will solely focus on its operations in the United States, Nazarali said in April. “We were founded really to solve a problem in the marketplace in the United States.”
Edited by Nelson Wang.