A new exchange says it is determined to expand the crypto market, opening doors to traders who want to buy and sell traditional financial instruments, all while giving institutional traders access to digital assets.
AAX launched in November 2019 with “a mission to connect crypto to global finance.” To this end, it plans to offer tokenized commodities and indexes, as well as social trading programs and security tokens. It is the first cryptocurrency exchange to be powered by LSEG Technology, which provides infrastructure to the London Stock Exchange Group.
Thor Chan, AAX’s CEO, thinks the crypto industry is at a pivotal moment right now. Times have changed since late 2017, when the sector had a market cap of $800 billion and startups could raise millions in a matter of minutes. However, he believes tokenization offers an irresistible opportunity to tap into gold markets worth $8 trillion, not to mention global stock markets valued at $80 trillion.
With the Bitcoin halving scheduled to happen just around the corner in May, Chan said: “AAX is confident that the crypto industry has the potential to grow at least a hundredfold, reaching into the trillions, and find its rightful place in global finance.”
“When crypto goes mainstream, we’re ready”
AAX offers spot, futures and over-the-counter trading. It quotes more than 50 cryptocurrency pairs and lists perpetual futures contracts for five major coins: Bitcoin (BTC), Ether (ETH), Litecoin (LTC), XRP and EOS. These can be traded with up to 100 times leverage.
AAX claims that most orders are processed in under 800 microseconds, making it faster “than any crypto exchange out there.” Its estimates suggest that its matching engine can scale up to 1 million transactions per second, meaning it won’t suffer capacity concerns when cryptocurrencies begin to enjoy mainstream acceptance.
A more sensible industry
Chan said that the heady days of the 2017 bull run were unsustainable and could not last forever, but added that the industry is “more sensible and professional” than it was before. Regulation is providing higher levels of consumer protection, and tokenization increasingly means “investment classes primarily accessible to financial elites with large amounts of capital will gradually become more open to retail investors.”
He added: “We see two movements that stand at the point of convergence. On the one hand, institutional investors are increasingly getting involved in the crypto space. On the other hand, digital asset innovation is making traditional asset classes more accessible to the mainstream.”
AAX revealed its plan to list its first commodity finance token, Phigold, on March 31. “It provides a real-world example of how blockchain technology can be leveraged to disrupt a well-established industry: gold investment,” the team noted.
Moreover, AAX has also announced that it is launching a native exchange token known as AAB that delivers discounts on all spot and futures trades and unlocks exclusive services, such as trading bots and trading signals.
A total of 100 people now work for AAX across two offices in Asia and Europe. The company believes that it offers the secret ingredient that will help the crypto sector grow: sophisticated products that enable different types of engagement with the market.