On Tuesday, Charles Schwab, Fidelity Digital Assets, and a group of other major financial firms announced a new exchange for trading cryptocurrency and other digital assets.
The exchange, EDX Markets (EDXM), is designed to address latent demand for digital asset trading by enabling safe and compliant trading through trusted intermediaries.
The new exchange will enable a highly liquid cryptocurrency ecosystem that aggregates liquidity from multiple market makers to reduce spreads and improve transparency. This is expected to result in better prices for investors than those offered by existing cryptocurrency exchanges.
EDXM operates as a fully independent entity backed by Charles Schwab, Citadel Securities, Fidelity Digital Assets, Paradigm, Sequoia Capital, and Virtu Financial. Additional market participants are expected to partner with EDXM over time. MEMX will provide the technology infrastructure for EDXM. EDXM is built to meet the needs of the world’s largest and most sophisticated financial institutions and retail investors.
By leveraging a network of select digital custodians to safeguard assets, trades will be netted and settled on the blockchain for greater speed and efficiency at lower cost, eliminating the need for expensive bilateral settlement. Also, officials say it will remove conflicts of interest that affect some existing cryptocurrency exchanges by separating responsibility for operating the exchange from the entities trading on it.
Jamil Nazarali, formerly global head of business development at Citadel Securities, serves as the CEO of EDXM, while Tony Acuña-Rohter, who previously served as chief technology officer at ErisX, has joined as CTO. In addition, David Forman, formerly chief legal officer at Fidelity Brokerage Services and General Counsel for Fidelity Digital Assets, is general counsel.
“It is a privilege to lead EDXM as we build this exciting new trading ecosystem, and I am grateful for the participation, support, and guidance of our consortium members. We look forward to welcoming additional participants to the exchange, which will drive ongoing trading in this important asset class while creating a virtuous cycle of continually enhanced liquidity and efficiency supported by MEMX’s cutting-edge technology,” Nazarali said,