24 Exchange putting fresh capital to work
Bermudian-based fintech company 24 Exchange is to continue expanding its multi-asset trading platform after raising $14.25 million in a funding round led by Point72 Ventures.
The company said the investment will support the platform’s expansion to encompass additional asset classes, including equities and cryptocurrencies, to provide new trading options for 24 Exchange's growing base of institutional market clients.
24 Exchange said it recently filed key portions of a Form 1 application in draft form with the US Securities and Exchange Commission for a licence to operate a national securities exchange.
Subject to SEC approval, the company said, the proposed exchange would operate around the clock, 365 days a year, and enable trades in US equities with a minimum increment of one one-thousandth of a share.
In September, 24 Exchange completed its first physical cryptocurrency trade under a Class T digital asset business licence issued by the Bermuda Monetary Authority.
Dmitri Galinov, CEO and founder of 24 Exchange, said: "In the company's first 24 months, we've successfully delivered an over-the-counter FX trading solution to clients that offers significantly reduced costs and improved functionality.
“We look forward to putting this additional operating capital to work to further expand our offerings beyond FX non-deliverable forward trading, FX swaps, FX spot and our most recent addition, cryptocurrency trading."
Today, the company said, most FX is traded off exchange, largely because over-the-counter desks can manually facilitate trades 24/7 and offer flexible structures to hedge against potential currency volatility.
However, it added, OTC desks lack the central authority, automation and safety of an exchange, which may expose traders to unnecessary counterparty risk.
By offering a central access point for investors to trade and settle FX in a more automated and risk-mitigated manner, 24 Exchange said, it combines the positive aspects of OTC markets through its innovative, low-cost platform and centralised trading interface that is always open.
Pete Casella, partner at Point72 Ventures, said: "We believe that widespread institutional adoption of crypto will require building bridges that enable traditional financial firms to access crypto in a way that looks and feels like how they operate in other tradeable assets, such as FX or derivatives.
“24 Exchange is doing just that by introducing innovations like the crypto non-deliverable forward contract, which allows institutions to gain exposure to this new asset class without taking on the risk, capital requirements and regulatory uncertainty associated with carrying the underlying asset on their balance sheet."
Point72 Ventures is a global venture capital fund with offices in the United States, England and Poland.
It is an affiliate of Point72, the global asset manager founded by Steven A Cohen, whose assets include the New York Mets of Major League Baseball.