Amidst reservations among investors about the uncertainties and price fluctuations in the cryptocurrency market, Riot Blockchain is reportedly planning to launch a regulated Crypto exchange in the United States.
Riot Blockchain, a public-traded company that has previously faced difficulties in regulations, has opted to start a regulated crypto exchange. This information could be gathered from a filing with the U.S. Securities and Exchange Commission (SEC) on Friday. As per the filing, the new company will be called RiotX, and it aims to develop three main services: banking, trading, and a digital wallet.
The firm focused on biotech for almost two decades. Then, in October 2017, it was renamed Riot Blockchain from Bioptix and completely shifted its focus to crypto mining. The recent application for the exchange was made years after the firm changed its business model. The firm also acquired a crypto brokerage and stated its plan to build an exchange in March 2018.
The company was also subpoenaed by the SEC for suddenly shifting to a blockchain business model, which resulted in a stock price hike. It should be noted that the company also changed its board of directors and CEO during the last year.
According to the SEC filing, the company explains that the new exchange is likely to be managed by its subsidiary, RiotX Holdings Inc. It also added that its main focus would be on Bitcoin mining.
The company also says that for RiotX’s banking services, it would launch an API created by software provider SynapseFi. This API would let users create accounts that would be linked to accredited banking institutions inside the U.S. and ultimately allow them to hold and transfer either fiat or crypto assets.
The company explained that the API would track users’ locations and identities “in order to prevent fraud and improper use of its RiotX exchange.” This includes using the service in the United States, where crypto exchanges have yet to be legalized.
The statement issued at the time of registration said, “SynapseFi’s API will enable the Company to know where the user is when accessing RiotX, thereby enabling the Company to prevent a user from Montana, a state where the exchange of digital currencies is permitted, from traveling to neighboring Wyoming, where the exchange of digital currencies is not permitted, and using RiotX in the prohibited jurisdiction.”
For the upcoming trading services, RiotX is likely to work with exchange software provider Shift Markets. The firm also expects RiotX to operate in all the American States except Hawaii and Wyoming by the end of this year. At the time of registering, the firm claims to have approval in five states already.