EDX Markets, a new cryptocurrency exchange backed by Citadel Securities, Fidelity Investments and Charles Schwab, has quietly entered the market, aiming to attract brokers and investors interested in digital assets.
The exchange, which has not yet officially announced its launch, operates non-custodial, which means it does not deal with clients’ digital assets directly. Instead, it serves as a marketplace where companies can execute trades. This eliminates the risk of bank-style failures that the industry has seen in 2022 with FTX, Celsius, and others.
The development comes as US exchange Coinbase and global stock exchange Binance face lawsuits from the US Securities and Exchange Commission. While the crackdown has signaled increased scrutiny from regulators, the larger institutions appear to view this as an opportunity to prey on market share. These companies often have close relationships with regulatory agencies and are more effective at complying with regulations as a result of their size, and as such, the current environment appears ripe for disruption.
In fact, BlackRock, the world’s largest asset manager with over $8 trillion under management, recently filing a Bitcoin ETF is another sign that these institutions see the current environment as an opportunity to expand in the sector.
SEC President, Gary Gensler, over and over again claimed This bitcoin Not safe, but it is a commodity, which effectively puts it outside the scope of SEC regulation. As a result, organizations like BlackRock may see bitcoin as the safest cryptocurrency to offer products to, although the recently announced EDX exchange will feature other cryptocurrencies as well.
Overall, the development suggests that BlackRock isn’t the only major traditional financial institution paying attention to bitcoin — everyone wants their piece of the pie, and regulators have served that pie fresh out of the oven.