Binance CEO Changpeng Zhao “CZ” Applauds EDX Crypto Exchange Backed By Citadel, Fidelity

Updated: 21 June 2023

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Changpeng Zhao, the CEO of Binance, expresses his support for EDX, a new cryptocurrency exchange that has received backing from major financial firms such as Citadel Securities, Fidelity Investments, and Charles Schwab.

Binance’s CEO expressed his applause for the progress made in times of regulatory scrutiny in one of his now-deleted tweets, stating that increased competition in the cryptocurrency market is a positive development. “Impeccable timing. But the more the merrier.”

Launch of EDX

On Tuesday, EDX was introduced with the goal of offering “a special, noncustodial model intended to mitigate conflicts of interest.”

Additionally, the platform “introduced a retail-only quote to the cryptocurrency markets, allowing participants the benefit of better pricing for retail-originated orders,” and anticipates releasing EDX Clearing later this year “to settle trades matched on EDX Markets.”

The exchange seeks to draw in “industry leaders” by integrating best practices from conventional finance and providing distinctive advantages such as liquidity, competitive quotes, and a noncustodial model created to reduce conflicts of interest.

The new EDX exchange will initially limit trading to Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), and Bitcoin Cash (BCH) on its “noncustodial” platform.

EDX also intends to launch EDX Clearing, a clearinghouse designed to settle trades performed on the EDX Markets platform, in the upcoming months. This system will enable conducting trades with a single counterparty, providing participants with significant benefits like increased pricing competitiveness, reduced settlement risk, and increased operational efficacy.

Furthermore, the company has recently concluded a funding round with the participation of strategic investors such as Miami International Holdings, DV Crypto, GTS, GSR Markets Ltd., and HRT Technology. These investors join the company’s original backers, including Virtu Financial, Charles Schwab, Citadel Securities, Fidelity Digital Assets, Paradigm, and Sequoia Capital.

However, the U.S. Securities and Exchange Commission (SEC) is still cautious about cryptocurrency developments in the U.S., notwithstanding CZ Binance’s expression of relief over resolving the issue.

What’s Happening in the Crypto World

EDX’s launch coincides with the SEC’s recent crackdown on unregistered cryptocurrency trading platforms and security tokens. This development comes just a few weeks after the SEC filed a lawsuit against Coinbase and Binance, including CZ Binance.

This move comes as SEC Chairman Gary Gensler maintains that most cryptocurrencies should be classified as securities and subject to the agency’s oversight, which is the primary reason why crypto exchanges are facing regulatory scrutiny.

The SEC chair recently stated that investor protection is essential, and emphasized that the volatility of cryptocurrency markets should not put investors at risk.

Despite regulatory uncertainties, the positive outlook for the U.S. crypto market is shared not only by EDX Markets supporters but also by Blackrock, the largest asset manager in the world. Last week, it submitted an SEC application to establish a Bitcoin trust. Although some interpret this move as a request for an exchange-traded fund (ETF) that invests in Bitcoin, the SEC has denied all such requests to date.