EDX Markets Differentiates Itself with Regulator-Friendly Business Model, CEO Jamil Nazarali Reveals

EDX Markets Differentiates Itself with Regulator-Friendly Business Model, CEO Jamil Nazarali Reveals

EDX Markets (EDX), a recently launched cryptocurrency exchange in the United States, is garnering attention due to its unique business model that has received praise from regulators. In an interview with CoinDesk in April, EDX CEO Jamil Nazarali highlighted the distinguishing features of the platform.

Supported by prominent institutions such as Fidelity Digital Assets, Charles Schwab, and Citadel Securities, EDX Markets underwent a nine-month-long development phase before its successful launch. The company proudly announced the completion of an investment round with new equity partners and expressed its commitment to bringing the same principles of competition, transparency, fairness, and security found in traditional assets to the world of cryptocurrencies.

EDX Markets initially gained significant traction in September with investments from renowned traditional finance firms, including Fidelity, Schwab, Paradigm, Sequoia Capital, and Citadel, where Nazarali himself had previously worked. The recent launch of the digital asset market has attracted further capital investments from entities like Miami International Holdings, DV Crypto, and GTS.

This development comes shortly after the news that asset management giant BlackRock filed paperwork with the Securities and Exchange Commission (SEC) to establish a spot bitcoin exchange-traded fund (ETF).

One of the key distinctions that sets EDX Markets apart from other crypto exchanges is its approach to handling customers’ digital assets. Unlike traditional custody models, EDX does not directly hold users’ assets. Instead, customers are required to transact through trusted financial intermediaries, similar to how trades are executed on established stock exchanges such as the New York Stock Exchange (NYSE) or Nasdaq. Regulators have embraced this approach, appreciating the clear separation between the exchange function and the role of broker-dealers.

Nazarali explained that investors increasingly prefer trading through trusted intermediaries, especially given recent concerns surrounding FTX, which was expected to lead the digital market. In a post-FTX landscape, where trust is paramount, investors are turning to long-standing firms that have withstood the test of time. This trend serves as a significant advantage for EDX Markets.

In the near future, EDX plans to launch EDX Clearing, a platform designed to settle trades executed on the EDX Markets platform.

Currently, EDX Markets offers a limited selection of tokens, including bitcoin (BTC), ethereum (ETH), litecoin (LITE), and Bitcoin Cash (BCH). This conservative approach is partly due to the uncertain regulatory landscape in the United States. Nazarali emphasized that EDX prioritizes regulatory clarity and refrains from trading potentially classified securities. This commitment to risk mitigation has been well-received by regulators.