Sam Bankman-Fried's FTX US is taking a stake in 'Flash Boys' exchange IEX to bolster access to digital assets by retail and institutional investors
"I've long respected Brad's vision for IEX to be an exchange that caters to the needs of the investor," Sam Bankman-Fried said of IEX CEO Katsuyama.
FTX
- The US arm of Sam Bankman-Fried's FTX crypto exchange will take a stake in private stock exchange operator IEX Group.
- The companies said they will work together to establish a "transparent" market structure for the trading of digital assets.
- The companies didn't disclose the size of the stake FTX US is planning to take.
The US-based arm of Sam Bankman-Fried's FTX crypto exchange said Tuesday it's taking a stake in stock exchange operator IEX Group to expand retail and institutional investors' access to digital assets.
The companies said in a joint statement they will work together to establish a "clear, simple, and transparent" market structure for buying, selling, and trading digital asset securities. The size of the stake and financial details were not disclosed. The deal, which is subject to regulatory approval, is expected to close in May.
Bankman-Fried — the 30-year-old co-founder of FTX, which earlier this year was valued at $32 billion — said FTX US has been working with regulators to set up a crypto-asset exchange that complies with their rules. He said IEX will build on its existing market structure and regulatory principles to safeguard investors and the public as a whole.
"I've long respected Brad's vision for IEX to be an exchange that caters to the needs of the investor and treats them fairly – part of the reason why we've operated similarly at FTX," said Bankman-Fried about IEX Group CEO and co-founder Brad Katsuyama.
Katsuyama and private stock exchange IEX shot to fame through Michael Lewis' book "Flash Boys," a 2014 best-seller centered on the world of high-frequency trading.
"To unlock its full potential, the crypto and digital asset industry needs to engage with regulators and truly scale what has been built," Katsuyama said in the statement.
"We both see the regulators as important allies in providing a clear path forward and attaining the highest possible standards for investor protection," he said. "The U.S. market should be the largest player in digital assets globally and we believe that this partnership will help facilitate that."
US lawmakers and regulatory agencies are working on unifying oversight of the $2 trillion cryptocurrency market. President Joe Biden recently signed an executive order for further federal work on developing a national policy on digital currencies.
Meanwhile, Securities and Exchange Commissioner Gary Gensler on Monday said the SEC and the Commodity Futures Trading Commission, which regulates US derivatives, should team up to regulate crypto exchanges.
Along with the strategic investment, FTX and IEX said they plan in the coming weeks to outline an initiative for all investors "to join the conversation" about the future of market structure for digital asset securities.