For the first time, an exchange for cryptocurrencies launched at BlockTrade.com, regulated under the MiFID II (Markets in Financial Instruments Directive) framework.
According to Bloomberg, “There are over 1,500 digital currencies registered at over 170 crypto exchanges. Over 60 trades per minute take place at the busiest. Yet none of these are seeing regulations from MiFID II. As the Financial Times says, ‘Crypto bros are known to self-identify as libertarians, believing in the primacy of individual autonomy and the minimal interference of government or any other centralized authority in our lives.'”
By using MiFID II, regulators want the ability to spot risks early and quickly reconstruct events should something suspicious happen. For example, according to Bloomberg:
- Institutions must report information about most trades immediately, including price and volume
- Traders of European Union securities must hand over personal identification, such as passport numbers, to every venue they trade on
- Brokers need to synchronize their clocks and time-stamp all trades
- Bond traders — for the first time — need to tell the market about deals they’ve done within 15 minutes of them taking place
- Brokers and investment managers will have to record all conversations related to a deal and store them for at least five years.
In short, the exchange wants to add transparency to trading.
With regards to cryptocurrencies, the exchange is in beta testing mode, which will start July 25th, 2018, ending August 2018.
The Exchange Should Roll Out in September 2018
The exchange platform will trade Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), Bitcoin Cash (BCH), and Ripple (XRP).
Traditional stock exchanges have been supportive to the idea, too, says Luka Gubo, CEO of BlockTrade.com, as noted by Bloomberg. He believes that if more institutions enter the cryptocurrency markets, some volatility will disappear.
“The regulated exchanges see the unregulated ones as unwelcome competition because they break the law to their own advantage. These exchanges need to follow the rules, but they don’t.”
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