The U.S. Securities and Exchange Commission (SEC) has said that it wants to see cryptocurrency markets, including exchanges, take steps to protect investors from manipulation if exchange-traded funds (ETF) are to be approved. One exchange is already working toward cleaning up the space and has introduced a tool that will allow it to monitor the platform for market manipulation and suspicious activity.
The Bitstamp exchange has announced that it will begin to use the Irisium Surveillance platform to uncover questionable market activity. The platform, which is already used by a number of financial entities including the Asia Pacific Exchange (APEX), is partly owned by Cinnober, a tech developer for financial markets with which Bitstamp recently partnered.
Bitstamp’s founder and CEO, Nejc Kodric, stated of the inclusion of Irisium, “We are committed to crypto in the long term. Our desire is to guarantee a fair and orderly market which reflects genuine supply and demand. Exploring new frontiers in preventing market manipulation is essential for the industry to mature.”
Irisium, according to the company’s website, has created a number of tools that allow entities to monitor trading platforms and ensure compliance with European regulations, including the Markets in Financial Instruments Directive, the Market Abuse Regulation and the Regulation on Wholesale Energy Market Integrity and Transparency. The site further asserts, “The system makes available the tools and analytical data to enable regulators to identify, track and investigate any trading activity” and “is already utilized by European regulators.”
Irisium’s CEO, Alastair Goodwin, explained of the new partnership with Bitstamp, “Bitstamp’s pro-active adoption of Irisium and close partnership with us demonstrates their desire to increase transparency, integrity and confidence in the cryptocurrency market. … Enhanced customer protection and market integrity will help drive adoption and market liquidity.”
Bitstamp’s decision to use the Irisium platform was completely independent of the SEC’s statement on market manipulation. However, the timing is perfect and could, if it works as planned, allow for crypto exchanges to jump one of the hurdles that have keep institutional investors at bay. Moves such as this, coupled with the announcements made by Fidelity and NASDAQ that they are almost ready to get their crypto platforms going, should help 2019 to be an important year for the crypto industry.
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Cryptocurrency exchange Bitstamp has tapped financial technology solutions provider Cinnober to replace its in-house matching system, which will make for speedier completion of trades.
Bitstamp Chief Technology Officer David Osojnik, in a press release, said that he expected the platform’s order matching speed to become 1,250 times faster than at present, with throughput increasing 400 times. “While Bitstamp’s matching engine was already very good by crypto standards, this will put us in the same league as traditional exchanges with decades of experience,” he said.
Implementation of the new matching engine, which will use Cinnober’s TRADExpress Trading System, will be in several phases, beginning in the first quarter of 2019, with full implementation targeted by the second quarter.
Bitstamp CEO Nejc Kodrič said, “This is a crucial step on our mission to bridge the gap between crypto and traditional finance. Our matching engine will be on par with traditional exchanges in both speed and throughput, once again placing Bitstamp on the technological frontier of crypto trading.”
Just last week, Bitstamp announced it had been acquired by investment firm NXMH, which will hold an 80% stake in the exchange. Last September, Nasdaq announced its public offer to acquire Cinnober for $190 million.
Cinnober, in its statement, said the new trading system will allow Bitstamp to meet demands even as the cryptocurrency market grows further. Cinnober Group CEO Peter Lenardos said, “By upgrading their trading technology to further improve performance and stability as interest from investors and regulators grow, [Bitstamp] demonstrate[s] their firm commitment to providing a safe and reliable marketplace.”
Among Cinnober’s existing clients are the Australian Securities Exchange, Brazil-based B3, the Dubai Gold & Commodities Exchange, Euronext, Japan Exchange Group, the London Metal Exchange, the Johannesburg Stock Exchange, and the Stock Exchange of Thailand.
Last month, Cinnober partnered with cryptocurrency payment solutions provider GAP600 to enable instant confirmation of cryptocurrency transactions on exchanges. The value-added functionality uses a risk engine that determines the risk involved with each transaction, and guarantees payments via an underwriter.
Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.
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Bitstamp, the Luxembourg-based cryptocurrency exchange, has made a deal. The exchange has announced that it has agreed to be acquired by investment firm NXMH in an all-cash arrangement that gives NXMH 80% of the company. However, customers don’t need to be concerned. Bitstamp only agreed to sign the deal after assuring that no changes will be made to the platform.
Bitstamp’s co-founder and CEO, Nejc Kodric, said that the company has received a number of proposals to sell over the years, but this was the first one that it took seriously. He said that the company decided to make the deal after reviewing NXMH’s quality and the quality of the offer, as well as an impending trend that will see more consolidation in the industry.
Kodric will remain at the helm and keep 10% of the operations. He started the exchange in 2011 with Damian Merlak in a Slovenian garage with two laptops and an initial investment of $1,100. The company now has over three million registered companies and has been valued at as much as $60 million. The exchange is the largest in the European Union by trading volume, turning over around $100 million each day.
Merlak previously sold his 30% stake in the company and has not been involved with its operations since 2015. Additionally, Pantera Capital Management, which invested $10 million in Bitstamp in 2014, also sold part of its stake to NXMH.
NXMH is an investment company out of Belgium. It is owned by the South Korean investment company NXC, which invests primarily in digital technologies. The firm already owns one cryptocurrency exchange – South Korea’s Korbit.
There are no plans to merge Korbit with NXMH. Each will continue working their respective markets and Kodric stated, “Customers should not have any concerns about their accounts or changes to the way we operate.”
Bitstamp has had to weather a decline in trading this like, as have all crypto exchanges. Kodric indicated that the exchange’s volume has decreased as much as 70% this year, but that the value to the company was still high since prices are, on average, trading higher than they were for almost all of 2017.
Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.
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