Crypto exchange backed by Schwab and Fidelity goes live offering bitcoin and ether trading

A crypto exchange backed by financial giants Charles Schwab, Fidelity Digital Assets and Citadel Securities has officially launched trading in four crypto assets, the company said Tuesday.

EDX Markets first announced its launch plans for a "non-custodial" exchange in September, about two months before the collapse of FTX. Paradigm, Sequoia Capital and Virtu Financial are among the other early backers.

The announcement comes days after BlackRock filed an application to launch what would be the first spot bitcoin ETF in the U.S., confirmation that despite the crypto industry's black eye from FTX and other bad actors in 2022, and the chill from U.S. regulators this year, long-term institutional interest has not diminished.

The EDX exchange allows trading of bitcoin, ether, litecoin and bitcoin cash – none of which were named "crypto asset securities" in the lawsuits the Securities and Exchange Commission brought against Binance and Coinbase two weeks ago.

EDX has said it strives to "meet the needs of the world's largest and most sophisticated financial institutions" – many of which remain crypto curious but skeptical of centralized crypto services providers, if not because of the failures of many in 2022 then because of the regulatory uncertainty the remaining players now find themselves in.

To quell any fears about misuse of funds, EDX plans to operate as a "non-custodial" exchange, meaning that rather than handling customer assets directly it will act as a platform on which a network of firms can execute and settle trades between crypto assets and fiat currencies.

EDX also has plans to launch a clearinghouse business this year to facilitate the settlement process but will still keep customer assets held at third-party banks and a crypto custodian.

The company is set to announce Tuesday that it has closed a second funding round with new investors, including the options-exchange operator Miami International Holdings and affiliates of proprietary trading firms DV Trading, GTS, GSR and Hudson River Trading.