The first fully regulated cryptocurrency exchange launches

Getting all the regulatory approvals to launch a cryptocurrency exchange is a big deal. Liechtenstein-based cryptocurrency exchange Blocktrade has received approval from the Financial Markets Authority, which is a member of the European Securities and Markets Authority (ESMA), and will be the first regulated exchange to open in test mode. The activities of the exchange will be regulated in accordance with the European Union Directive on the Markets in Financial Instruments (MiFID II).

“Until now, crypto trading has been inaccessible to financial institutions. Blocktrade.com will be the first available trading platform. In addition, the platform is capable of processing more than 1 million trades per second and will improve this result every day,” the company’s website states. “This is a great opportunity for regulators across Europe to recognize cryptocurrency as a new asset class and regulate accordingly,” said Luca Gabo, CEO of Blocktrade.

Initially, trading pairs Bitcoin, Ethereum, Litecoin, Bitcoin Cash and XRP (Ripple) will be available on the platform. Later this year, the platform will also offer packages of cryptocurrency assets (Crypto Traded Indices), security tokens and tokenized assets. The exchange is expected to be fully launched in September, but for now only registration is open.

Many institutional investors still view the unregulated exchanges, of which there are more than 170, as dangerous due to a lack of transparency. However, Gabo argues that there is significant demand for cryptocurrency investments from fund managers.

“Currently, institutional investors who want to invest in cryptocurrency face certain challenges. For example, where to place a purchase order. Many people speculate on the price of cryptocurrency, making it difficult to reduce volatility. Proper regulation is the only way to reduce this risk,” says Gabo. The more institutions that enter the cryptocurrency market, the lower the volatility that scares many traditional investors will be. ICOs will eventually also be traded on an exchange once they are regulated.

In relation to other new cryptocurrency exchanges, Blocktrade considers them to be its competitors. They, according to the founder of the new site, are breaking the law and have a huge unfair advantage because they do not have to follow any rules.

Regulated exchanges and the potential introduction of a Bitcoin ETF (exchange traded fund) by the US Securities and Exchange Commission (SEC) could have a very positive impact on the industry and the price of cryptocurrencies.