U.S. Crypto Exchanges May Begin Offering Stock Trading

U.S. crypto trading platforms FTX and Bitstamp may begin to offer stock trading to their customers in an effort to compete with popular platforms such as Robinhood and eToro.

FTX U.S. President Brett Harrison tweeted earlier this week that the company is “hard at work on stocks!” he added that the exchange was hoping to add features such as live prices, company data, portfolio performance tracking, and more according to Bloomberg.

The report added that it was not clear yet as to whether the firm would try to become an official exchange such as the New York Stock Exchange or Nasdaq.

Crypto Brokerage Divisions

Many crypto exchanges user brokerage arms through which users place trades which get directed to the exchange, it added. A similar system works with stocks with companies such as Robinhood operating as the brokerage platform for exchanges such as the NYSE.

Bitstamp USA is also reportedly investigating stock trading, NFTs (nonfungible tokens), and crypto derivatives. According to chief executive Robert Zagotta, it is a “very competitive space, and there are some very significant players in it.”

The exchange, which is one of the longest-running, would need to make big investments and acquisitions in order to proceed into the realms of stock trading.

An alternative is offered by some exchanges is tokenized stocks called synthetics. However, this has attracted a heavy-handed response from regulators, especially in the U.S. Binance began offering them last year but abruptly withdrew the assets in America following an avalanche of regulatory backlash.

Regarding the world’s largest exchange offering equities trading, a Binance spokesperson told Bloomberg that it’s “going to remain laser-focused on developing leading blockchain technologies for our users and expanding into markets that more naturally complement blockchain’s future.”

FTX Expansion

FTX has been the fastest-growing crypto-asset exchange over the past year. It is not as big as industry leader Binance but has made impressive growth in terms of users and daily volumes for both spot trading and crypto derivatives.

The U.S. division secured a number of high-profile sports partnerships and advertising deals in 2021 as it attempts to dominate in a highly regulated market. In December, FTX’s global valuation was raised to $32 billion following another large funding round.

According to CoinGecko, FTX currently processes $1.7 billion in daily spot trading volume which is way behind Binance with $17 billion in daily volume. The exchange is better known for derivatives, however, with $9 billion in daily volume ranking FTX as the world’s third-largest crypto derivatives exchange.