London Derivatives Exchange (LDX), formerly GMEX Exchange, has said it will launch security tokens and digital assets to its trading platform after spending two years developing a crypto trading solution.
In a statement, the exchange operator said that it will use its existing Financial Conduct Authority (FCA) authorisation in the UK, as well as its US regulatory exemptions for US clients, to provide the expanded platform.
Using blockchain technology, smart contracts and tokenisation, LDX added that its platform enables support throughout the complete trade lifecycle, including execution, reporting, compliance, clearing and custody. As well as capital raising tokens, LDX will offer digitised versions of traditional market products, crypto-based exchange traded funds (ETFs) and derivatives.
“The addition of security tokens to a common platform providing electronic trading and confirmation of listed derivatives, brings two diverse yet potentially complimentary product lines together,” LDX said. “The ability to have access to both traditional financial products, security tokens and digitised assets on one platform that is built to serve the needs of the financial markets, offers the opportunity to bring two diverse and very large liquidity pools together.”
LDX has also embarked on several partnerships with broker-dealers, a custodian and a trust company, to act as the settlement and clearing platform, and a set of funds to provide funding for the capital raising tokens.
“We believe the transition to using these new technologies has to be a journey that’s sympathetic to the regulators as well as the resources and requirements of the institutions and clients used to trading financial products,” VJ Angelo, CEO of LDX, commented.
“The trick to success here is to become the meeting point of the two worlds on one platform. This is a common refrain for many firms, however LDX has learnt a great deal over the last seven years, about integrating new and innovative technology and methods into the market place. It’s not easy or inexpensive. Our lessons have however put us in a unique position to deliver such a platform.”