Why does EDX Markets only list BTC, ETH, LTC, and BCH? Seeing through Wall Street’s “perfect strategy” for entering crypto

EDX Markets officially announced the launch of its digital asset market, which will provide trading services for four cryptocurrencies including BTC, ETH, LTC and BCH. As for why only these four tokens are listed?

Because the exchange only allows trading of cryptocurrencies that are not securities, this is also considered a new way out for current compliance exchanges...

The world of cryptocurrencies is showing a polarized picture of differences. A few weeks ago, native currency exchanges such as Binance and Coinbase were facing crazy crackdowns from regulatory agencies such as the U.S. Securities and Exchange Commission (SEC). However, strangely, traditional financial institutions took advantage of this to accelerate the pace of crypto-related layouts. First, Asset management giant BlackRock took the initiative to apply for the Bitcoin spot ETF "iShares Bitcoin Trust", and later rumors spread that Fidelity may be considering acquiring Grayscale.

EDX only trades cryptocurrencies that are not securities

Yesterday evening, EDX Markets, an exchange supported by Fidelity, Charles Schwab, Citadel Securities, Sequoia Capital, Paradigm... and other companies, officially announced the launch of its digital asset market, which will provide BTC, ETH, Trading services for four cryptocurrencies including LTC and BCH.

Unlike native cryptocurrency exchanges such as Binance and Coinbase, EDX Markets, which has a traditional financial background, is more oriented towards institutional customers. It will provide API-based trading instead of a traditional front-end user interface. In addition, the biggest special thing about EDX Markets is that the exchange does not directly custody customer funds, but manages customer funds through third-party banks and professional custody service providers; in other words, EDX Markets is only responsible for matching Orders, no custody of user assets, similar to traditional stock exchanges.

None of the four cryptocurrencies currently listed on EDX Markets have been recognized as securities by the SEC. Interestingly, this coincides with the content of SEC Chairman Gary Gensler’s speech in 2018, an institutional forum hosted by Bloomberg and Fidelity. A video of the investor event went viral recently, in which he mentioned:

Over 70% of the cryptocurrency market is Bitcoin, Ethereum, Litecoin, Bitcoin Cash. Why do I name these 4 coins? They are not securities...three quarters of this market are not securities.

Some videos of Gary Gensler's lectures at MIT have been uncovered, showing that he once claimed that Ethereum is not a security. Now this video is the most important and is used as a rule guide by institutional investors and hedge funds. This may make Wall Street found a "safe zone" in the SEC regulatory case, which became the reason why EDX Markets only chose these four tokens to list. At the same time, these four tokens were not classified as securities in the Binance and Coinbase lawsuits.

Cryptocurrencies may enter the mainstream

From the above basic introduction, we can know that EDX Markets tells a completely different narrative from exchanges native to the current currency circle (such as Binance, Coinbase). In the past, when encryption regulations were unclear and vague, native exchanges Cryptocurrency exchanges can only explore on their own and hope that one day a new legal framework will be set up to apply to new cryptocurrency instruments.

However, in the past, in the process of seeking a set of compliance requirements for native crypto transactions, they have been repeatedly suppressed by the supervision of various countries, especially the United States, which has repeatedly suppressed Binance. Even Coinbase, an exchange approved by the SEC for listing, has not been able to escape violations of securities laws. litigation.

EDX Markets, a traditional financial giant, seems to have found a safe line of compliance in this chaos. Starting from the cryptocurrencies that Gary Gensler identified as non-securities, even though the supervision is still vague, it meets all regulatory conditions.

Although it is still unknown whether EDX Markets can gain a foothold in the Crypto world, it is inevitable that traditional financial institutions have made a big step towards cryptocurrency and once again proved that the crypto market has strong appeal. As regulations mature, it is still worthy of our continued observation whether traditional cryptocurrency institutions will list many new tokens like Binance, Coinbase, etc. and become the main driver of cryptocurrency adoption.