[dropcap size=small]B[/dropcap]itcoin and regulation, it is still a difficult story. Most people do not care when it comes to merchants accepting the virtual currency or any matter like that. However, when we’re talking about cryptocurrency exchanges, there seems to be an audience for a more regulated environment. It is a delicate matter, after all. The hopes and prayers of these folks seem answered. Atlas ATS and The National Stock Exchange (NSX), today, announced they closed a partnership deal.
More thoroughly, they announced they have signed a Memorandum of Understanding. This signing will have NSX develop and enforce rules to regulate Atlas ATS, which will make Atlas the first fully regulated digital currency exchange in the United States. In order to regulate the virtual currency exchange, NSX will utilize rules that are already in use by U.S. stock and options exchanges. These rules will be announced later today. “Once the two parties have agreed to those rules and surveillance procedures, Atlas will become the first bitcoin marketplace to be regulated by a quasi-government entity,” Atlas CEO Shawn Solves said. “Bitcoin and other digital currencies are quickly gaining acceptance worldwide, but there is a tremendous need for a secure, trusted entity to exist before investors are comfortable trading this new asset. Investors, both retail and institutional, need an exchange with top-notch security, fast trading technology, and trusted oversight. That exchange is Atlas ATS.”
This is not the first move Atlas ATS made to convince people of its intentions to become a true stock market for cryptocurrencies. A few weeks ago, the exchange issued a press release where it announced tons of new features for what it called ‘Atlas 2.0’. This release included the addition of major altcoins and the presence of ‘options’ for digital currencies. These options offer Atlas ATS’ users two types of contracts, called ‘Calls’ and ‘Puts’. They enable users to trade the right to buy or sell at a set ‘strike’ price on a given ‘expiration’ date.
Through this deal, NSX has forced itself into the cryptocurrency market. A not so bold move, considering the growing popularity of Bitcoin and exchanges. Especially security has been an ongoing issue, it was only a matter of time before a move like this one was made.
“We are very excited about working with Atlas ATS and all other market participants in the digital currency space to create a framework for safe, transparent and auditable rules applied to a unique market place. In this regard, the NSX intends to target its regulatory capabilities to identify currently non-regulated financial exchanges — digital currencies and their derivatives are prime examples of such markets,” said David Harris, CEO of NSX.
Although Atlas ATS takes pride in calling itself the first fully U.S. regulated Bitcoin exchange, more similar news has been emerging from other enterprises lately. Last week, CCN’s Caleb wrote an excellent piece on Secondmarket’s first fully regulated Bitcoin exchange services webpage. This was their first step towards becoming a fully regulated exchange. The estimated date of arrival for this service is Summer 2014.
If all goes according to plan, it looks like Atlas ATS will be the first U.S. regulated cryptocurrency exchange. Wall Street has found Bitcoin, whether you like it or not. I am sure there are several crypto fanatics out there who think regulation is the opposite of what Bitcoin stands for. While there are pros and cons to this development, we all knew it was just a matter of time before this happened. Especially in the trading business. Lots of major companies are reluctant to trade before everything is compliant to U.S. law. When you add to that the fact that regulated exchanges do not have to fight for money-transmitting licenses in every U.S. state, it is clear that there are several major advantages to this.
How do you feel about regulated Bitcoin exchanges (or the move towards cryptocurrency regulation in general?). Let us know what you think in the comments or discussion groups.
Shawn Sloves photo by Atlas ATS.