Is Bitcoin trading coming to Nasdaq?

The Nasdaq is the second largest stock exchange in the world, and it seems it might want to add trading of Bitcoin and cryptocurrencies to its services.

There is nothing official yet, but a recent initiative of the company seems to be heading in this direction.

On the other hand, it makes perfect sense that traditional exchanges like Nasdaq will eventually offer crypto trading as well, given that they already offer trading of crypto derivatives like ETFs.

The initiative of Nasdaq: Bitcoin trading could become a reality

A few days ago, the executive vice president of Nasdaq, and global head of law, risk, and regulation, John A. Zecca, sent a long open letter to the SEC Secretary, Vanessa Countryman, in which he asked the agency to put an end once and for all to the issue of the nature of cryptocurrencies as securities or commodities.

The key issue addressed by Zecca is the regulation of digital assets, and consequently the SEC guidelines for example on stablecoin and memecoin.

Everything starts from the recent statements of Commissioner Peirce of the SEC, the so-called “crypto mom”, according to whom the taxonomy is precisely the starting point to grasp the essential nature of digital assets, and thus finally be able to determine their correct treatment as financial instruments according to the law.

Zecca emphasizes that it will have to be a sort of teamwork, because the regulation will have to be produced by the Congress, while the SEC will then be responsible for the concrete guidelines.

Finally, it adds that the Nasdaq is at the disposal of the SEC for any questions regarding this matter.

The content of the letter

The content of this open letter is long and technical.

The objective, however, is clear: to equip the USA with a regulatory framework that makes it possible for crypto trading even on platforms like Nasdaq.

In fact, the company has proposed a new comprehensive regulatory framework aimed at integrating digital assets into the existing U.S. capital markets.

Currently, in fact, the real cryptocurrency trading in the USA can only be done on crypto exchanges, and not on traditional exchanges like Nasdaq. On traditional exchanges, in fact, there are only crypto derivatives like ETFs, but not the actual tokens that can be deposited and withdrawn like BTC, ETH, etc.

The framework proposed by Nasdaq provides a distinction of cryptocurrencies into four taxonomies, namely financial securities, investment contracts, commodities, and others.

Furthermore, it also suggests establishing a new specialized trading venue (ATS) called “ATS-Digital” or “ATS-D”.

In this way, even the traditional exchanges could decide to open their own ATS-Digital and thus allow crypto trading.

The evolution of the U.S. crypto landscape

Until the inauguration of the new Trump administration, on January 20, the SEC would never have considered such a hypothesis, not even if it had been proposed by the Nasdaq. To be honest, on the other hand, until that day the Nasdaq had never ventured so far forward.

One of the key points of this matter is the limited knowledge of the deputies and senators of Congress regarding such new and complex issues.

Given that the Congress has already been working for some time on new regulations, whose approval process was effectively blocked during the Biden administration, it is obvious that in order to proceed, it will have to rely on those who are well-versed in such matters.

This means that on one hand, the government agencies that oversee the financial markets, such as SEC and CFTC, will certainly be consulted, while on the other hand, the exchange platforms, like Nasdaq or Coinbase, will also need to be involved.

Obviously, there are no converging interests among all these parties, but in the end, it is likely that a compromise will be reached. However, it remains to be seen whether the compromise will be fair or skewed, and if it is skewed, it will be necessary to understand in which direction.

To tell the truth, under the current amministrazione Trump, a possible shift towards the crypto markets seems more likely than towards the more conservative positions of Congress or the agencies, also because this is a revolution that can hardly be stopped.

Moreover, if a pillar of traditional finance like Nasdaq intervenes in favor of the crypto markets, the probabilities that the new regulation will be favorable to cryptocurrencies seem to increase.