​Fidelity, Citadel, and Schwab launch crypto exchange for institutional traders

What’s new? On June 20, the non-custodial crypto exchange EDX Markets (EDXM), backed by a consortium of financial corporations that includes market maker Citadel Securities, holding company Fidelity Investments, and broker Charles Schwab, began operating, WSJ reports. EDXM is geared toward institutional traders, accessing trading through APIs and offering no graphical user interface. In addition, the exchange works with retail brokerage firms that route investors’ orders for cryptocurrency transactions to its trading platform.

The WSJ’s material

What else is known about the exchange? According to EDXM CEO Jamil Nazarali, the collapse of the FTX exchange has increased demand for platforms that do not have conflicts of interest related to holding customer funds. According to the website, EDXM only supports spot trading in four cryptocurrencies, BTC, Bitcoin Cash (BCH), Litecoin (LTC), and Ethereum (ETH), and is not registered with the Securities and Exchange Commission (SEC).

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Fidelity, Citadel, and Schwab announced plans to launch EDXM in September 2022. At the time, the exchange was supposed to target not only institutional traders but also retail traders. Meanwhile, last November Fidelity launched the Fidelity Crypto service to trade digital assets for retail clients. And in June of this year, rumors emerged that Fidelity was preparing to launch a spot bitcoin exchange-traded fund.

After the SEC filed lawsuits against exchanges Binance and Coinbase, among others, for operating without registration, the Commission’s chair Gary Gensler accused the crypto companies of deliberately avoiding regulation.

In addition, the SEC categorized the following tokens on blockchains with a Proof-of-Stake (PoS) consensus algorithm traded on platforms as unregistered securities: SOL, ADA, MATIC, FIL, SAND, AXS, CHZ, FLOW, ICP, NEAR, VGX, DASH, NEXO, ATOM, MANA, ALGO, AXS, and COTI.

Amid regulatory uncertainty, online broker Robinhood will stop supporting MATIC, ADA, and SOL cryptocurrencies from June 27. For the same reason, American clients of broker eToro will no longer be able to open new positions in ALGO, MANA, DASH, and MATIC tokens from July 12. Crypto platform Bakkt already delisted ADA, MATIC, and SOL, while the team at payment platform COTI suspended the gCOTI exchange after the token was listed as a security.