- Crypto exchange ErisX raised an additional $20 million for its Series B, bringing on new investors including Castle Island Ventures, Dragonfly Capital Partners, and New York Digital Investment Group
- The newly injected capital will prepare the firm for its upcoming crypo derivatives market, which is scheduled to be launched by the end of the year
- If successful, ErisX will be the first regulated crypto exchange for both spot and derivatives trading
ErisX announced on Tuesday that it’s raised another $20 million from a string of new investors as it prepares for life after the launch of its spot market.
The crypto world has been waiting with bated breath for the launch of the Wall Street-backed firm’s marketplace for crypto trading, which was announced with much fanfare way back in October 2018. Now, the firm is bringing on new investors as part of its Series B, including Castle Island Ventures, Dragonfly Capital Partners, and New York Digital Investment Group.
In addition to this new round of funding, ErisX also announced the launch of its crypto spot trading platform; noting that this move will support its futures trading and clearinghouse businesses later this year. If successful, ErisX will be the first crypto exchange that provides both spot and derivatives trading side-by-side in a market regulated by the Commodities Futures Trading Commission. The order book is set to go live at 7 a.m. CT, according to a spokeswoman.
A new kind of crypto platform
“As somebody who has been a keen observer of this market, I can say it is bifurcating into two large categories: market-places that seek oversight and transparency and a category of markets that seek a light or zero regulatory touch,” said ErisX Chief Strategy Officer Matt Trudeau in an interview with The Block. Trudeau said the firm wants to lead the pack for the former.
To be sure, it’s not clear exactly when ErisX’s futures platform will launch. By way of comparison, it took 2 years for bitcoin derivative exchange LedgerX to receive the CFTC approval for its bitcoin derivative trading and clearing services. Rival Bakkt, which originally hoped to get its bitcoin futures market off the ground in late 2018, doesn’t have a set launch date. Trudeau noted he was “pleased” with the speed of its regulators.
The launch of ErisX’s spot trading platform follows news that ErisX has been in test-mode with brokerage firm TDAmeritrade and others to offer crypto trading to retail customers. The company said that testing is going on as planned, declining to mention specific partners.
“It looks like a very familiar experience to other markets. Production platform needs to get stood up, then we have the integration work and then you exercise the platform,” said Trudeau.
Planning for the future
So far, ErisX has a disclosed $47.5 million in total funding. The company is planning to use the extra funds to add new services after the basics for spot and futures are ironed out.
“It will let us think about what we might want to do above and beyond,” said Trudeau. “We could think about the expansion of the core trading experience.” For instance, the firm could enable block trading for institutions, allowing counter-parties who have negotiated a trade between themselves to print that trade. It could also expand the number of order types it offers and expand internationally.
Several existing investors of the company, including Cboe Global Markets, CMT Digital, Consensys, Pantera Capital, Nasdaq Ventures also followed-up in this new round of funding.