Published on March 23, 2015 at 21:12 GMT
Major American stock exchange Nasdaq has announced a first-of-its-kind partnership with bitcoin startup Noble Markets.
As part of the deal, Noble will utilize Nasdaq’s X-stream technology upon its formal launch, joining the 30 global marketplace that currently use the multi-asset trading platform. Led by founder and CEO John Betts, Noble Markets boasts a team with experience at traditional financial giants such as Goldman Sachs, Morgan Stanley, Merrill Lynch and UBS.
Perhaps best known in the bitcoin community as one of the investors and organisers behind the campaign SaveGox.com, Betts has also served as VP of strategy for Strevus, a regulatory compliance platform provider that added support for digital currency startups in 2014.
Betts indicated that his latest venture seeks to leapfrog competitors in the market by providing many of the functionalities they may be seeking to build out of the box. For example, Betts went on to suggest that, as a marketplace, Noble won’t aim to compete against bitcoin exchanges, but instead seek to provide liquidity to these companies.
Betts told CoinDesk:
”We’re not trying to fight for a slice of the pie, we’re building the venue where the large capital that exists in the capital markets and corporations that use these products as part of their business needs, where we can provide that liquidity to other exchanges. The goal is to create a larger pie.”
Describing the product as a bridge between the traditional financial and bitcoin communities, Betts said that Noble aims to find "the best of both worlds" in terms of attracting these now disparate ecosystems.
Betts suggested that Nasdaq, in turn, was eager to work with a partner in the bitcoin space and that they were an active player in helping to forge the relationship.
Solving a business need
Key to this goal of growing the size of the bitcoin market, Betts contends, will be services that utilize bitcoin but provide a more familiar experience to entrants from traditional financial backgrounds.
Equipped with Nasdaq’s technology, Betts believes Noble will be best positioned to tackle this problem, given that it will use standard interfaces built on “20 years of intellectual property”.
“They need counterparties that will provide the services they need to do business, and they have not had a counterparty that they’ve been able to trade bitcoin with,” Betts added.
Betts went on to state that Noble has invested its own resources into building what he categorized as robust real-time risk management, consolidation and settlement capabilities.
Further, he suggested these tools would be necessary for any marketplace that wanted to convince larger players they could be responsible for customer assets.
Nasdaq embraces innovation
In statements, representatives of Nasdaq sought to portray the announcement as one that positions the more than 40-year-old company as supportive of “new and emerging technologies”.
Lars Ottersgård, Nasdaq’s executive vice president of market technology, said his company will continue to support the efforts of Noble as it explores the use of its technology in a new market.
“We are thrilled to work with the experienced industry veterans at Noble Markets and look forward to supporting their cutting-edge, new endeavor for the long term in addressing the needs of the digital currency space,” Ottersgård said.
Betts went on to say that, based on his personal experience, he believes major financial institutions are beginning to evolve their thinking about the larger bitcoin ecosystem to the point where they’re now eager to get involved with the technology.
Though he believes bitcoin provides a number of inherent advantages, Betts suggested that benefits by themselves are not enough, concluding:
"To be able to leverage that, there are other products and services they need, and that's part of the Noble Markets value proposition."
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