Riot Blockchain Reveals Plans to Launch a New Crypto Exchange in the US
The cryptocurrency market had a terrible period in 2018. Several cryptocurrencies lost as much as 90% of their price values during last year. The largest digital asset, Bitcoin was on a losing spree first six months consecutively, finally ending the streak in February earlier this year.
Analysts and speculators stated that it was the beginning of the end for the crypto bubble, and believed that the situation will keep deteriorating. However, this hasn’t prevented new players from entering the market which proves that the game is far from over.
Riot Blockchain, a US-based blockchain company has announced that it will be launching a new regulated crypto exchange in the country by the end of this year. The new entity will be called RiotX and will be regulated by the US Securities and Exchange Commission (SEC). RiotX will focus on three main services, viz, banking, trading and digital wallets.
The announcement was made via a filing with the SEC on Friday. The company has had regulations and compliance issues with the US regulatory agency in the past. Prior to its foray into the crypto space, the company was engaged in biotech business for about two decades, under the name Biotpix, which was changed to Riot Blockchain. The company shifted its focus to crypto mining in October 2017, following which the company was served a show cause notice by the SEC for the sudden shift in business model, which resulted in a certain hike in share prices.
During the past year, Riot Blockchain revamped its board of directors following the resignation of its chief executive. It also acquired a crypto futures brokerage firm called Logical Brokerage in March 2018.
In an official statement, Riot Blockchain said that the exchange will be managed by its subsidiary RiotX Holdings Inc., and will mostly focus on Bitcoin mining. RiotX will also launch an API based software, SynapseX, for banking services. The statement further read that API will also track the location and identity of users to prevent fraud and inappropriate use of the exchange. There are a few states in the US, where crypto exchanges are not yet legalized, and the exchange will have to take measures to avoid serving people located in these states, though it will restrict the number of users.
SynapseFi’s API will allow the company to locate where the user is while engaging with RiotX. If the user’s location seems to be a state where digital asset exchanges are not permitted, the platform will restrict that user’s access to the exchange, and vice versa. The crypto exchange will be operated in collaboration with exchange software provider Shift Markets, as it ended its contract with the Canadian exchange Coinsquare following the SEC investigation of 2018.
Riot Blockchain has claimed that it already has approval from five states, and the exchange will be operating throughout the United States, barring Hawaii and Wyoming, by the end of 2019.
The crypto space has been witnessing a certain resurrection since February, which has rejuvenated speculations for a bull market. Giant corporations like JPMorgan, IBM, Facebook, etc., have entered the digital asset game by launching their own cryptocurrencies and related services. Bitcoin has gained stability over the past few weeks and has been consistent in price at around $3,900 – $4,000.
However, the crypto exchanges throughout the US will witness a revamp, as the SEC is planning to establish a formidable regulatory framework for digital asset trading in the country. Especially, after arch-rival Russia announced its plans to reduce its dependence on the USD by introducing its own cryptocurrency, the regulatory agency will be taking extra efforts to avoid any kind of foreign manipulation or fraudulent practices on crypto exchanges.
