EDX Markets, a cryptocurrency platform backed by Charles Schwab (BLACK), Fidelity and Ken Griffin's Citadel Securities, launched bitcoin trading (BTC), ether (ETH), litecoin (LTC), and bitcoin cash (BCH).
key takeaways
- Schwab and Fidelity-backed crypto platform EDX Markets began trading bitcoin, ether, litecoin, and bitcoin cash.
- EDX is a 'non-custodial' exchange, which means it does not have customer crypto and instead uses a third-party custodian.
- EDX plans to launch a clearinghouse later this year to help clients settle trades.
- EDX also announced new investors including Miami International Holdings, DV Crypto, GTS, GSR Markets LTD, and HRT Technology.
How is the EDX platform different?
EDX platform has avoided โcrypto asset valuesโ the subject of recent SEC lawsuits against Binance and coin base (CURRENCY). By positioning itself as a โnon-custodialโ exchange, EDX aims to meet the needs of major financial institutions seeking crypto exposure but hosting Bookings on centralized cryptographic service providers.
A non-custodial platform means that you do not hold your clients' crypto tokens and instead ensures that client assets will be held with third-party banks acting as crypto custodians, eliminating concerns about potential misappropriation of funds.
For example, Coinbase acts as a custodian for its customers' cryptocurrencies, unless they opt for a self-custodial Coinbase wallet. While it's easy to start trading cryptocurrency with an exchange that holds your tokens, the risks include losing your assets in the event the exchange is hacked or diminished profits due to custody fees.
The exchange works as a platform that connects a network of companies to execute and settle transactions between crypto assets and fiat currencies. However, it still doesn't help settle those trades. EDX expects to launch a clearing house business later this year, which will allow it to conduct settlements.
The launch of the exchange comes shortly after that of BlackRock. presentation for the first bitcoin exchange-traded fund (ETF) in the United States, indicating sustained institutional interest in the crypto market over the long term despite recent industry setbacks and regulatory concerns.
EDX also closed a second round of financing, attracting new investors including Miami International Holdings and affiliates of proprietary trading firms DV Trading, GTS, GSR and Hudson River Trading.
