Charles Schwab, Citadel-backed crypto exchange goes live today: WSJ

EDX Markets, a cryptocurrency exchange supported by major financial players Citadel Securities, Fidelity Investments and Charles Schwab, is expected to go live later today, offering trading in four cryptocurrencies: bitcoin, ether, litecoin and bitcoin cash. 

The exchange was first revealed in September, seeking to cater to brokers and investors interested in digital assets, and will announce its official launch today, nine months after it unveiled the plans, the Wall Street Journal reported.

Unlike traditional cryptocurrency exchanges, EDX said it draws on traditional finance standards but will operate as a "non-custodial" exchange and won’t directly handle customers' digital assets. Instead, EDX will provide a platform where firms can execute trades between cryptocurrencies and fiat currencies. 

The actual transfer of crypto and cash between parties to settle the trades takes place outside of EDX's platform. While EDX plans to launch a clearinghouse later this year to facilitate trade settlement, it intends to utilize third-party banks and a crypto custodian for holding customer assets. EDX's non-custodial approach aims to alleviate concerns over security and potential misuse of customer funds, avoiding conflicts of interest.

EDX won’t directly serve individual investors but expects retail brokerages to route investors' orders to buy and sell cryptocurrencies on its platform — mirroring the stock market.

In addition to Citadel Securities, Fidelity Investments and Charles Schwab, EDX has backing from Paradigm, Sequoia Capital and Virtu Financial. The exchange will also announce the closure of a second funding round, with new investors including Miami International Holdings and affiliates of proprietary trading firms DV Trading, GTS, GSR and Hudson River Trading, the Wall Street Journal reported.

The launch comes despite regulatory challenges in the U.S. following the Securities and Exchange Commission’s recent lawsuits against Binance and Coinbase for alleged securities law violations.