Swarm Markets, which operates the world’s first regulated decentralized trading exchange, has announced on Thursday its official launch as a company regulated by the Federal Financial Supervisory Authority (BaFin), the German financial watchdog. The firm collected over $15 million in funds from more than 250 persons who joined its liquidity provider program.
According to the press release, the platform will offer tokenized securities that can be traded with cryptocurrencies. “We see regulation as necessary for the evolution of DeFi as opposed to it being a limiting factor. Instead of reinventing the wheel, we’ve applied existing German regulation to DeFi markets. This regulatory layer will give enough assurances and protections to allow capital and assets into the ecosystem that have been sitting on the sidelines for too long,” the exchange said.
Cirus Co-Founder Daniel Bland on What’s Next for the Ownership EconomyGo to article >>
Furthermore, Timo Lehes, co-founder of Swarm Markets, highlighted the current environment surrounding crypto prices and the inception that the firm is making into the industry: “We find ourselves in a perfect storm where interest rates are historically low, and people’s assets are not being put to good use. It’s accepted there are certain advantages of moving trading business onto the blockchain, but asset owners are concerned with counterparty risk and compliance.”
With the launch, Swarm Markets will offer a payment token that grants early adopters of the platform 50% trading fee rebates, together with other rebates. The firm also operates the provisional licenses under the German Banking Act (KWG), including Commission Business; Agent Broking; Trading on own account; and Custodian Business.
Recently, Coinbase, the US-listed cryptocurrency exchange, announced that it had obtained a license from the BaFin to provide crypto custody and trading services in Germany. As a result, according to the company, the firm will now operate as Coinbase Germany GmbH, subject to the licensing regime introduced last year.