The IEX Exchange, an American trading bourse, is considering the development of a trading platform for virtual currencies in collaboration with Coinbase Global Inc. This publicly traded company is the market leader.
To realize this major objective, IEX Exchange Chairman Brad Katsuyama is said to have engaged in conversations with Coinbase, as stated (1) in a Fox Business report that cited anonymous people close to the situation.
As was mentioned, the stock exchange has been in discussions with the FTX Derivatives Exchange, which is now filing for bankruptcy, to float the government-licensed crypto trading platform.
According to the reports, participants participated in the negotiations, including FTX, IEX Exchange, and even the United States SEC.
The negotiations reached a standstill after FTX filed for bankruptcy, and IEX began looking for a new trading partner.
Even though it is still unclear how far along the negotiations are, IEX is keeping its fingers crossed that Coinbase will be able to play a significant part in developing a trading platform that will verify all applicable legislation markets with the SEC.
The authority overseeing financial markets has never wavered in its stance that most exchanges are engaged in illegal activity because they offer cryptocurrencies that are more suited to the category of unregistered securities.
The commission's position on regulating cryptocurrencies has been criticized by the most influential players in the sector for being ambiguous.
Brian Armstrong, the CEO of Coinbase, has never been shy about criticizing the SEC for the opaque nature of its regulatory framework. In the past few weeks, the agency has gone all out in taxing licensed platforms despite no adherence to the calls.
Earlier this month, the SEC, led by Chairman Gary Gensler, filed a lawsuit against Kraken Exchange for $30 million.
The authority regulating financial markets alleged that the trading platform had been providing its staking service in an unlicensed capacity.
The SEC has sent Paxos Trust a Wells Notice over the BUSD issuance it is planning. From the looks of it, the SEC and Paxos could soon become involved in an expensive legal spat.
The IEX Exchange Desires to Take a Different Approach to Cryptocurrency
Despite the concerns regulators raise, many people assert that the cryptocurrency market will play an important part in developing future financial systems. Consequently, the IEX Exchange is contemplating implementing several novel approaches.
IEX is attempting to embrace the technology of the future without being subjected to the same regulatory assault as its predecessors by trying to obtain a trading platform licensed by the SEC.
As a result of the bourse's success in the more general realm of stock markets, there is a greater likelihood that the planned new enterprise will receive clearance from the SEC.
An IEX spokeswoman remarked, without confirming, that the company is in discussions with Coinbase:
"We continue to look into ways in which we may help create a legal road for digital asset securities, such as discussions with regulatory agencies and other market participants; however, we have not finalized any particular proposal that includes any third parties at this time."
To mitigate some of the negative effects of high-frequency trading on the stock market, IEX Exchange was founded. As time passes, fresh information and revelations will become available that will demonstrate the precise working mechanisms of the new exchange.