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With the dreams of many investors wishing to circumvent the traditional financial markets system by trading Bitcoin on virtual exchanges severely damaged, Bitcoin venues partnering with established stock exchanges may restore the faith.
Despite the nerve-wracking journey which Bitcoin has taken recently, America’s virtual currency advocates are making almost daily progression toward integrating it into the country’s mainstream financial markets infrastructure.
Atlas ATS is the latest dedicated Bitcoin platform to have begun to look away from infrastructure and venues which are specific to virtual currency, instead partnering with a mainstream stock exchange.
The New York based Atlas ATS, according to the Wall Street Journal, has elected to partner with the National Stock Exchange, which is a small venue serving North America and overseas, and as a subsidiary of CBOE Holdings (NASDAQ:CBOE) is regulated by the Securities and Exchange Commission (SEC).
One of the major difficulties and potential barriers to engineering a partnership between a mainstream exchange which provides the trading of recognized, sovereign currencies, corporate stock and physical commodities and a Bitcoin exchange is that the difference in purpose and interest runs counter on both sides.
Bitcoin has experienced such high recent values despite its complete lack of any form of security purely because of its ability to circumvent the traditional financial markets system, but also from the perspective of an established stock exchange, trepidation would be most certainly high due to the unpredictability of the values and supply of virtual currency.
As far as consumer confidence is concerned, once Atlas ATS and the National Stock Exchange have agreed on the proposed set of methodology as to how to enforce SEC rulings and apply them to a Bitcoin exchange when the product itself has no formal issuer or governace overseas, Atlas ATS will become the first Bitcoin venue to fall under any form of regulatory auspices, according to Shawn Solves, who serves as CEO at Atlas ATS.
Quite how successful the SEC will be with not only drafting such rulings but also implementing them in the event of a potential customer complaint or irregularities found in compliance inspections is unknown, however the clever move on the part of Atlas ATS is that it as a venue is taking the responsibility for the regulatory obligation, rather than the US authorities having to attempt the near impossible task of regulating Bitcoin activity.
According to Mr. Solves, partnering with a mainstream exchange assists the Bitcoin exchange with efficient inception, as the extremely time-consuming process which face Kraken and CoinMkt is mitigated.
Rather than its management team consisting of maverick pioneers whose aim is to elevate virtual currencies past those issued by sovereign nations as has been the case with some other Bitcoin proponents, Atlas ATS’ management team has demonstrated its professional will to work closely with the mainstream financial markets venues.
National Stock Exchange, which dates back to 1880, lists William Karsh as a special adviser. He is also the Chairman of Atlas ATS, and cites the National Stock Exchange’s decision to work with Atlas as having been made by David Harris, CEO of National Stock Exchange.
Launched last month with links to sister exchanges in Hong Kong and Singapore, the marketplace is currently processing 7,000 to 10,000 transactions a day while the public exchange is handling volume of just 100 to 1,000 trades a day, Mr. Solves explained to the Wall Street Journal.
Whereas Bitcoin had recently reached something of a nadir following the demise of MtGox, the last in the long line of failed virtual currency enterprises which left investors high and dry, and whose assets will be liquidated by the Japanese bankruptcy court despite bids by investors to resurrect it, this may be the very first genuine step toward institutional firms taking responsibility, therefore a step in the direction of a more steady future.