Leading global financial institutions, including Charles Schwab, Citadel Securities, Fidelity Digital Assets, Paradigm, Sequoia Capital, and Virtu Financial, have announced the formation of a compliant cryptocurrency exchange, EDX Markets, targeting United States retail and institutional investors.
In a press statement published on September 13, the consortium entailing broker-dealers, global market makers, and venture capital firms stated that the exchange aims to borrow some practices from the traditional financial markets.
According to the EDXM board, the exchange seeks to meet the increasing demand for cryptocurrencies among investors in the U.S.
“Crypto is a $1 trillion global asset class with over 300 million participants and pent-up demand from millions more. Unlocking this demand requires a platform that can meet the needs of both retail traders and institutional investors with high compliance and security standards,” said EDXM’s Board of Directors.
Solving existing crypto exchange problems
Additionally, the group noted that EDXM seeks to solve challenges encountered by exiting trading platforms like liquidity. EDXM will reportedly aggregate liquidity from multiple market makers to improve transparency.
The companies affirmed that the exchange would focus on removing any conflict of interest by separating responsibility for operating the exchange from the entities trading on it.
The statement added that a leadership team has already been appointed, with Jamil Nazarali, formerly Global Head of Business Development at Citadel Securities, taking over the mandate as the EDXM Chief Executive Officer. In the future, the exchange plans to hire players from both the crypto and traditional finance sector.
In setting up the crypto exchange, the parties involved noted that they would leverage technology offered by MEMX, a technology-driven stock exchange.
It is worth pointing out that some of the partners behind the exchange have previously collaborated on different digital asset products. In June, trading firms Citadel Securities and Virtu Financial Inc partnered to unveil a retail brokerage to offer crypto-executions to their customers. The project also attracted the participation of Sequoia Capital and Paradigm.