The world’s second largest stock exchange, Nasdaq says it is open to becoming a cryptocurrency exchange in the future. After a positive quarterly earnings, Nasdaq’s CEO Adena Friedman announced in an interview that when regulations regarding cryptocurrency trading has been properly ironed out, Nasdaq would surely consider becoming a cryptocurrency stock exchange.
When CNBC Squawk Box host Kevin O’Leary asked if she was a believer of cryptocurrency or not, here’s what she had to say:
“I would definitely say that – I believe that digital currencies will continue to persist. It’s just a matter of how long it will take for that space to mature. Once you look at it and say, ‘ do we want to provide a regulated market for this?’, certainly, Nasdaq would consider it.”
Due to the cryptocurrency still being largely unregulated, major stock exchanges such as Nasdaq are yet to become official crypto-exchanges. However, they are starting to enter into deals with other crypto-exchanges in terms of providing market infrastructure technology. Nasdaq, as recently as on Wednesday, entered a deal to provide its surveillance technology to the crypto exchange Gemini Trust Company, in order to monitor bitcoin and Ethereum trading pairs.
While Friedman was fairly open in her support for cryptocurrency, she didn’t share the same sentiment towards the cryptocurrency fundraising process called initial coin offering or ICO.
“ICOs need to be regulated,” she said. “The SEC is right that those are securities and need to be regulated as such.”
A more than 1,300 per cent rise of bitcoin prices in 2017 caught the eye of regulatory authorities and this led to the crackdown of ICO fraud by the SEC in 2018. In March, the SEC announced that it plans on applying laws on all organisations that are crypto-related right from cryptocurrency stock exchanges to cryptocurrency wallets.
Although many legacy financial institutions have begun to show interest in the cryptocurrency market, a key roadblock for Nasdaq and other financial institutions is regulation. Nevertheless, more companies each day are growing optimistic about implementing cryptocurrency services in the near future.