The CEO of Nasdaq, the world’s second-largest stock exchange, said that they would be open to eventually becoming a cryptocurrency exchange at some point in the future. In an interview with Squawk Box, Adena Friedman, the CEO of Nasdaq fielded questions about the current status of the exchange, including the use of Nasdaq’s surveillance technology by Winklevoss-headed cryptocurrency exchange Gemini, as well as future plans for Nasdaq’s entrance in the cryptocurrency sphere.
Fieldman said, “Certainly Nasdaq would consider becoming a crypto exchange over time. If we do look at it and say ‘it’s time, people are ready for a more regulated market,’ for something that provides a fair experience for investors.”
Answering questions about the use of the company’s surveillance technology to monitor trading by Gemini, she said, “It’s an unregulated space today, so it’s not something that we’ve decided to go into becoming an exchange, but we are providing our technology now to other cyrpto exchanges.”
Gemini will be utilizing the Nasdaq technology to monitor trading pairs on their exchange. That technology will also be used to monitor real-time trading of both bitcoin and Ethereum in the Gemini marketplace and will help assess and find unusual trading patterns. Gemini President Cameron Winklevoss told the Wall Street Journal, “We’re doing this because we believe in the importance of creating a rules-based marketplace. We believe that this is where things are headed.” In a statement, Winklevoss wrote that the technology would help ensure that Gemini “provides a fair and rules-based marketplace” for investors.
Fieldman was also asked as to her beliefs on cryptocurrency, to which she responded, “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 you want to provide a regulated market for this?’, certainly, Nasdaq would consider it.”
It’s clear that one thing preventing larger investors and exchanges such as Nasdaq from entering the cryptocurrency sphere is the lack of regulation, which is something that Friedman indicated would need to be “ironed out” before the company would add a cryptocurrency exchange.
Friedman also said that “ICOs need to be regulated. The SEC is right that those are securities and need to be regulated as such.” Both the SEC and the CFTC have been evaluating ways to crack down on ICO fraud and according to SEC Chairman Jay Clayton, the SEC will be devoting a “significant portion of resources” to monitoring the ICO market. We would like to note the statement that “the SEC is right that those are securities and need to be regulated as such,” is an inaccurate statement. The SEC is currently abiding by a case-by-case policy and has not enacted any rules or regulations on the sector as a whole.
