Crypto Exchange

Wall Street titans have backed the recently announced cryptocurrency exchange, which will go live in November. Several Wall Street titans have announced their intention to support a new crypto exchange.

On September 13, a group of financial firms, including Fidelity Investments, Charles Schwab Corp, and Citadel Securities, announced the news. The EDX markets exchange may be a more well-integrated investment in crypto assets than traditional financial securities.

Following the news that asset manager Blackrock would provide institutions with direct exposure to spot Bitcoin, this move is no surprise. Thus, the latest developments on Wall Street demonstrate their unwavering faith in digital assets, even amid the crypto cold.

A New Exchange Will Launch Non-Security Digital Assets

The cryptocurrency exchange will go live in January, after a trial period, says Jamil Nazarali, CEO of EDX market. During the trial run, a limited amount of spot crypto tokens, including Bitcoin, will be verified as being traded on the platform and not considered securities. Investors on the EDX market could trade their digital assets through their existing broker, just as they would when buying and selling stocks and options.

Nazarali remarked:

“We’re taking some of the best features of traditional finance and bringing it to the digital markets to make it more efficient and bring that cost saving to investors.”

As a result, they would not need to rely on an external market or a local cryptocurrency exchange. Furthermore, this action will make crypto trading more similar to regular finance trading and reduce crypto investors’ costs when trading. In addition, US regulators are determining whether certain crypto assets qualify as securities.

As a result, it must be subject to additional regulation. EDX, on the other hand, is avoiding that conflict. According to Nazarali, the exchange will only issue a few tokens that are not securities.

Is New Crypto Exchange a Wolf in Sheep’s Clothing?

The crypto exchange with cheaper fees seems tempting. However, cryptocurrency investors must take precautions. The reason for caution stems from research conducted last year by five US professors, who discovered that Wall Street might not be as fair as it asserts.

The researchers used their own money to make 85,000 trades in 128 stocks over the course of five months. However, they discovered that the purchase and sell prices differed significantly, depending on the brokerage that managed the transaction. . According to their research, infrequent US investors could pay up to $34 billion in annual fees.

The University of California carried out the investigation and clearly states that there are additional hidden fees for day trading and no-fee brokerage accounts. This is because, even though transactions are handled by wholesale market makers such as Citadel and Virtu Financial, brokerages charge different fees. Furthermore, even minor differences can have a significant overall impact.

As a result, the study calls into question Wall Street’s claim that it offers clients lower trading costs. It also raises concerns about their plan to use the EDX exchange to provide a market structure comparable to cryptocurrency trading. But the move shows that investors of all sizes are increasingly interested in digital assets.

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