Bittrex may Overperform Coinbase with new Partnership with Rialto Trading
Bittrex, a highly growing crypto exchange has entered into a partnership with licensed broker-dealer Rialto Trading for a new digital securities trading platform that is pending approval from the appropriate United States Authorities.
Rialto Trading is an alternative trading platform that offers fixed income securities and once the approval is received, it will also offer crypto securities using Bittrex’s expertise in the area.
Bill Shihara, the CEO of Bittrex said,
We’re merging Bittrex’s technology, cybersecurity and blockchain expertise with Rialto’s deep knowledge of the securities industry. And, when you add that foundation with Rialto’s extensive background in financial services, including Shari’s experience at Goldman Sachs and Deutsche Bank, this new venture is well-positioned to further advance blockchain’s adoption by offering a comprehensive solution at the right time.
This announcement reached a lot of people when Weiss Ratings tweeted about it. The rating agency tweeted,
U.S.-based cryptocurrency exchange Bittrex is partnering with registered broker-dealer Rialto Trading to offer a trading venue for blockchain-based digital assets. #Bittrex is going for the kill – #Coinbase, watch out!
In response to this tweet, one user said,
‘Didn’t Coinbase already off themselves by not listening to its users?’
This bitter response is assumed to be referring to reports that Coinbase’s revenue has declined a whooping 83% since the bullish returns of December 2017.
Another user tweeted in response,
Agree, @coinbase has failed to listen to the people and their customers. Self destruct.
As per reports, both Bittrex and Rialto Trading were in talks with regulators however, there is no information on when this partnership will be approved for a launch. The report further adds,
Rialto runs a U.S.-registered trading platform for fixed income products and, pending approval from regulators, will expand its operations to include virtual tokens that are registered securities.
The venue will be open to institutional investors, corporations, U.S.-registered broker-dealers and accredited investors – who must meet U.S. securities regulations for annual income of at least $200,000 or a net worth topping $1 million.
It is clear from this report that Bittrex and Rialto Trading have identified a niche market that they believe needs to be filled. As regulators increase their watch on cryptocurrency, it is possible that many of them will be absolutely defined by regulators as securities and therefore there is a need for a blockchain based platform to trade this securities.
This announcement shows that Bittrex will be the first cryptocurrency exchange that will dive into the realm of traditional trading where all the institutional investments are done.
Coinbase, one of the biggest competitors of Bittrex is also trying to offer securities for trading through a broker-dealer license. Unlike Bittrex, who is partnering with a Broker-Dealer, Coinbase is planning to buy two firms that already have broker-dealer licenses. These firms are Keystone Capital and Venovate Marketplace. With this purchase, Coinbase will have greater control on the securities trade they offer.
@Apompliano,the founder of Morgan Creek Digital also tweeted about this news. Here are some replies about this announcement to his tweet.
Why are tokenized traditional securities such a big deal?Do you think they have more potential impact than cryptocurrencies?
Are tokenized securities only available for accredited investors?
it depends on the regulatory rules that are used. Reg D would be accredited investors in US but accredited and non-accredited investors outside the US. Reg A+ would be non-accredited investors and accredited investors in US. Those are just two examples.