Digital Markets ATS Inc. and 4C Clearing Corp. announced Tuesday they will seek approval from the Ontario Securities Commission (OSC) and the Investment Industry Regulatory Organization of Canada (IIROC) in early 2019 to launch an alternative trading system (ATS) for digital assets to provide investment dealers with the ability to trade, clear and settle cryptocurrencies and securities token offerings (STOs).
The platform would enable investment dealers to provide their retail clients with access to digital assets in their existing accounts, the firms say in a release.
“The result of our solution is that the retail investing public will now be able to use their existing brokerage accounts with participating investment dealers to trade eligible digital assets without the need to move funds out to unregulated entities. This will for the first time allow retail clients to hold eligible digital currencies such as Bitcoin, and approved STOs, in the same account as stocks, bonds, ETFs and mutual funds,” the firms say.
The firms have built the platform with the goal of fitting into the regulatory system.
Under their plan, Digital Markets ATS would be registered as an IIROC dealer and as an ATS; 4C would be recognized as a clearing agency or exempt clearing agency, authorized to clear, settle and provide custody for digital assets. “We intend to discuss with IIROC and the OSC regarding how market surveillance will be conducted,” they add.
“The support and positive momentum we have experienced from the regulated investment dealer community has propelled this project forward,” says Laurence Rose, co-founder, president and CEO of both Digital Markets ATS and 4C, in a statement.
“Providing regulated investment dealers with a safe and secure platform to get involved in the digital asset market, and with proper market surveillance, will allow their customers to have trust and confidence in their digital asset transactions in a way that is not currently available in the marketplace,” he says.
The firms hope to start trading by the end of 2019 or early 2020.