Hong Kong startup says its LSE-powered crypto exchange 10 times faster than others

Bloomberg Hong Kong | Updated on November 07, 2019

AAX, a Hong Kong-based startup, says its exchange is about to make Bitcoin trading at least 10 times faster than transactions taking place on some of the largest digital-asset exchanges.

The new platform will use technology from London Stock Exchange Group Plc and allow retail and institutional investors to trade cryptocurrencies with ultra-low delays, AAX said in a statement. It’s the first crypto exchange to deploy LSE’s core matching engine, which is already used by bourses in places like Oslo and Johannesburg, it said.

The platform is capable of handling large volumes of orders with an average latency of under 500 microseconds, or one-two thousandth of a second, according to AAX. That compares to the lowest latency of 5 milliseconds -- one two-hundredth of a second -- that Binance promises to a small pool of clients trading its futures products.

AAX will list more than 50 crypto-to-crypto trading pairs, as well as futures contracts for major tokens like Bitcoin and Ether. It also provides an over-the-counter platform for users to convert fiats like the dollar and yuan into cryptos.

AAX, which struck the deal with LSE in January, is one of the latest examples of how crypto and traditional markets are increasingly integrated. The New York Stock exchange’s parent company, Intercontinental Exchange Inc, recently launched its Bakkt unit for trading Bitcoin futures. Nasdaq Inc offers its surveillance technology to crypto exchanges including Gemini.

“We have been looking for a good solution that will be suitable for a long-term cryptocurrency exchange that is adopted and welcomed by the institutional or mainstream finance industry,” said AAX Chief Executive Officer Thor Chan in a phone interview. “LSEG tech is one of the most recognized.”

AAX is in discussions with LSE about a marketing partnership that lets AAX get the stock exchange’s clients on board its platform, Chan said.

Chan co-founded AAX’s holding company, Atom Group, in March 2018 and recently took over the CEO position from fellow co-founder Peter Lin. The firm, which they self-funded, now has around 100 staffers who are mostly based in Hong Kong with some in London.

AAX will focus on Asia markets to start with, and expand anywhere -- except the US, which requires strict licensing, Chan said. The goal is for AAX to be listed among the world’s top 10 crypto exchange by trading volumes in the coming year, he said.

Published on November 07, 2019

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