Cryptocurrency exchange FTX has entered the tokenized equities trading market with the listing of some of the popular company stocks.
Announced on Thursday, the exchange has partnered with German financial firm CM Equity AG and Swiss-based Digital Assets AG (DAAG) to allow traders to buy fractions of shares of companies like Tesla, Amazon, and Apple.
Other platforms, including Uphold and Robinhood, are also offering such fractional stock trading facilities.
“Our traders have never seen crypto as a niche field,” FTX founder and CEO, Sam Bankman-Fried said. “These products demonstrate a powerful future, in which assets are digitized and tokenized, and traders have unlimited creative potential to express their beliefs about the markets.”
— FTX – Built By Traders, For Traders (@FTX_Official) October 29, 2020
Cryptocurrencies and Stocks in the Same Platform
He further explained that the security tokens will behave similarly to a depository receipt or an exchange-traded fund (ETF). CM Equity will act as the custodian, and investors need to cash them out through its platform.
The exchange has opened registrations shortly after the announcement. It is to be noted that the new services will not be available in the United States and other restrictive jurisdictions of the exchange.
“Both crypto trading and equities trading have been steadily attracting a wider audience with new market participants coming in,” Bankman-Fried added. “These fractional stock products reflect the reality that today’s traders are industry and sector spanning and want trading opportunities that fully match their interests and mindset.”
Launched last year as a crypto derivatives exchange, FTX quickly tapped the trading markets with higher demand. Standing out from the crowd, the crypto exchange additionally offers crude oil and Bitcoin hash rate futures.
“In just a couple short years, FTX has built a ‘by traders, for traders’ brand that is constantly looking to innovate ahead of the trading status quo,” Michael Kott, CEO of CM-Equity AG, said. “In considering a first partner for our fractional stock offerings, they were the obvious choice.”