According to Bloomberg, EDX, a cryptocurrency trading platform, has raised $50 million in a second funding round co-led by new investor Pantera Capital. The company plans to use the funds to expand its products and pursue a license to operate an exchange in Singapore. Jamil Nazarali, EDX's founder and CEO, said that Singapore is a great place to hire financial talent and build a trusted team. The expansion comes as the cryptocurrency market is heating up again, with increased enthusiasm from traditional finance titans due to the recent approval of exchange-traded funds investing directly in Bitcoin.
EDX provides institutional investors with a platform to buy and sell tokens, including Bitcoin, Ether, and Litecoin directly, hedging their exposure to ETF products. To appeal to institutional investors, EDX built its own clearinghouse and outsourced the role of the custodian to avoid the potential for co-mingling of funds. The company's infrastructure is designed to mimic what exists in traditional markets outside of crypto. Last year, EDX launched a clearinghouse, EDX Clearing, which allows multiple counter-parties to settle a trade, reducing friction and the upfront capital required for investors to make a trade.
EDX is now seeking approval from the Monetary Authority of Singapore to operate an exchange in the country. The company plans to offer both spot and derivatives trading, which is expected to be a significant differentiator offshore. EDX's clients traded more than $1.4 billion in notional volume in December, and its clearinghouse has cleared over $3.1 billion of transactions since its launch in October. After the Bitcoin ETFs were approved, EDX customers bought and sold more than $100 million in a single 24-hour period this month, according to Nazarali.
