The London Stock Exchange sells tech to Hong Kong Cryptocurrency Exchange
The LSE, or London Stock Exchange, has followed other financial institutions by dipping its toe into the cryptocurrency market and selling its trading technology to the Hong Kong exchange AAX.
The Financial Times has the full story. It reported that on 22nd January, LSE sold its Millennium Exchange matching systems to the Hong Kong exchange AAX. This deal is reminiscent of the one struck by Nasdaq and Estonia’s DX Exchange a few days ago and suggests that established financial institutions are warming to this new industry (albeit rather cautiously).
Like most other financial institutions, LSE has so far maintained a somewhat lax and tentative approach to the blockchain and cryptocurrency industries. The UK as a whole still appears very cautious about how it should handle cryptocurrency regulation. Furthermore, lawmakers have exacerbated matters and shaken local adopters by suggesting potential restrictions and bans on all financial products related to cryptocurrency.
Atom Group, the financial supporters of AAX, claimed regulated entities can buffer the exchange sector, making it stronger and more stable, so bringing them in is likely to be seen as a positive step for the crypto industry overall.
The CEO of Atom Group, Peter Lin, said, “One of the things we see in crypto is a lot of people have built their own technology.” He suggests that trust and safety is an issue for investors whilst the industry and its products are still largely unregulated.
Proponents of Bitcoin have a different say on the matter though. They disregard the regulation logic and instead lay their argument based on claims that security can only be truly achieved by way of private custody and decentralisation. They maintain their stance that legislation through highly-regulated third parties cannot guarantee security and could lead to a system of money that remains controlled by corruptable entities. Despite this sentiment, it appears that governments and regulators around the world are pushing towards regulation and control which overall, could be seen as a positive step for cryptocurrencies.
On the other side of the globe, Japan has issued licenses to numerous exchanges in the past few weeks including Coincheck, which was hacked for over $500 million last year. After acquiring the exchange, the new owner Monex Group has gradually bought the platform up to speed once more, and users who suffered the brunt of the hack by losing their holdings have been promised refunds.