“We are mostly interested in having traditional financial assets issued on our platform, leveraging blockchain technology and ultimately being able to be traded by any trader within our ecosystem whether that is an institution or retail trader.
A year and a half in the making, Adam Leonard’s BlockEx has now been launched as a white label provider of cryptocurrency trading solutions. Providing a turnkey enterprise solution to brokerages wishing to provide a cryptocurrency environment to their retail customers, BlockEx has now made its foray into a live environment. Back in August 2015, BlockEx entered a partnership with UK-based Secure Trading to provide BlockEx’s broker clients with a turnkey payment solution to handle customer deposits and withdrawals. BlockEx is also adding integration with cellxpert and their affiliate tracking solution.
In December last year, BlockEx considered its then-imminent launch to be the perfect time for brokers to expand their current product offering and add a Digital Asset brokerage. This is an interesting development, and in the post-Bitcoin hysteria period of today, innovative digital asset platforms which are blockchain-centric are paving the way forward for various aspects of the future of the financial market's economy. In this particular case, a specialist in the electronic trading industry has developed it rather than the circumventor's of the establishment that have now gone by the wayside.
Today, FinanceFeeds spoke to Adam Leonard, CEO of BlockEx as it makes its foray into the brokerage sector.
Are you buying Bitcoin?
I had been buying Bitcoin since 2011 and kept trying to find my place in the space from a business perspective, on two separate occasions in 2011 I had pulled the plug on a venture at the last minute because of various concerns. Over the next few years, I spent my time in “crypto” working with startups to advise them on why they should be working with banks, that KYC and AML procedures would help expand their businesses and trying to help them find a balance between the spirit of Bitcoin and running a business. Some businesses lend themselves nicely to anonymity but others do not.
I finally decided to take the plunge and build my first “blockchain” company after the IOM Crypto Summit. During this summit, the SIBOS event in Singapore Blockchain really started to get the attention of regulators, governments and banks as something that was not their enemy but a piece technology that could really improve the financial system. At that time buying bitcoin was still hard, trading bitcoin for other “alts” was still very hard to do.
Most exchanges did not have payment processing, most exchanges were not all that fussed about AML and KYC. Additionally most exchanges had not been built to fill the needs of institutions. This led me to want to “test” a theory that if we built an exchange for traders, that was fully compliant, had full payment rails (CC, APN, Wire), was fast and secure that we could attract new liquidity into the industry. At the end of the day traders trade volatility. So we set out to build what would be at the time the only institutionally and high net-worth focused exchange.
We quickly realised that if we went to market trying to “win” as a stand alone exchange we would be dead in the water without a large war chest of cash to acquire clients. So we decided to build a Brokerage platform to sit on top of the exchange and switch to more of B2B focus. Our core exchange is HFT capable, with FIX and ITCH protocols this is specifically designed to serve the needs of institutions. The brokerage platform that fees retail traders into the exchange has features for the retail trader it comes with an OTC desk, Copy trading, and leverage trading.Our ultimate goal is to become the default exchange for digital assets, to do this we need to satisfy the needs of both retail and institutional traders from a technical point of view but also supply point of view. We are mostly interested in having traditional financial assets issued on our platform, leveraging blockchain technology and ultimately being able to be traded by any trader within our ecosystem whether that is an institution or retail trader.
For us we are working hard to have corporate and financial institutions issuers digital assets through BlockEx this includes bonds, equities, supply chain finance, syndicated loans commercial paper. In order to help facilitate this, we have had will have to continue to build tools to make this as easy possible for issuers. Today we are able to offer a bond issuance tool, with syndicated loans and supply chain finance to follow shortly.
In terms of security on the exchange we actually have several different issues that fall under security, this includes only allowing quality assets to be listed on the exchange (no Altcoin pump and dumps), it means we force all brokers to hold traders funds in a segregated bank account at arms length so traders deposits are never at risk, this also includes not having a B book and finally locking down the systems. Running a secure exchange is a much the human element as it is about systems being compromised.
After over two long years of building, we are finally ready to open the platform to the public, currently, we are on-boarding first 4 brokers, so hopefully without any unforeseen hiccups, traders should be able to start trading at the latest by mid-month. We will launch the exchange with Bitcoin and Ethereum for sure we are looking a few other Cyrpto Currencies to see what else would work for our customers.
With public sentiment being at an all time for some of the retail products available today, Bitcoin volumes and price hitting all time highs as well wave of new “digital assets” about to hit the market in 2017, the timing is perfect for brokers looking for something new to offer to their traders.