Token exchange startup to trade Nasdaq companies

Getting your Trinity Audio player ready...

A crypto exchange startup powered by Nasdaq will allow investors to trade in Nasdaq companies, according to an announcement from the firm today.

DX.Exchange said customers would be able to trade in tokens representing shares in different listed tech companies when the exchange goes live on January 7, which can be purchased for both fiat and crypto, Bloomberg reported.

In four days you can, for the first time, invest your #Cryptocurrencies in Digital Tokenized Stocks backed 1:1 by Real Stocks – Exclusively on https://t.co/gavrewTi9F. Read the full story from Bloomberg (@business) at https://t.co/0jemMhg2ND #exchangeyourway pic.twitter.com/4Yz8XgO7jP

— DX.Exchange (@DXdotExchange) January 3, 2019

The Estonia-based platform is powered by the Nasdaq securities matching engine, which handles the trades and prevents attempts at market manipulation and abuse.

While investors won’t directly own securities through the platform, the tokens are backed by securities and pay dividends in the usual way, offering a crypto alternative to traditional stock investing. According to a statement from DX.Exchange COO Amedeo Moscato, this represents a unique model for investing in Nasdaq companies.

He explained, “Henceforth, when they become a token holder, they own stocks or portions of the company’s stock, as the tokens are backed 1:1 to the real-world stocks. That makes them entitled to the same cash dividends that the stocks are worth.”

When customers buy through the platform, stocks are bought by another firm, MPS Marketplace Securities Ltd., and held in a segregated account, as an additional safeguard for investors.

MPS is regulated in Cyprus by the Cyprus Securities and Exchange Commission, with DX.Exchange under the jurisdiction of European Union regulators.

At launch, the exchange will offer a range of major tech securities, including AlphaBet, Apple, Amazon.com, Facebook, Microsoft Corporation, Tesla, Netflix, Baidu, Intel and Nvidia.

Through the partnership with Nasdaq, the platform will rely on the FIX financial information exchange, the same data exchange used by industry leading securities trading firms worldwide.

Alongside Nasdaq securities, the exchange will also offer access to buying and selling a range of cryptocurrencies.

The news comes alongside the announcement that DX.Exchange will power Bloomberg’s new crypto center, set to launch in the coming weeks, following an agreement reached between the firms. As an alternative to direct ownership of securities, the exchange is expected to prove popular with both cryptocurrency and fiat investors.