Hong Kong-based Crypto Exchange to Use London Stock Exchange's (LSE) Trading Software

  • London Stock Exchange Group Plc (LSEG) has agreed to let ATOM Group use its software.
  • Software to be used by ATOM's Hong Kong-based crypto exchange, AAX. 

The London Stock Exchange Group Plc (LSEG) has reportedly decided to sell some of its proprietary trading technology to the ATOM Group, a Hong Kong-registered multinational fintech firm.

According to the announcement’s press release, the ATOM Group is planning to use LSEG’s trading software for its cryptoasset exchange (called AAX). The integration of LSEG Technology's “Millennium Exchange” platform is scheduled to be completed during the first half of this year. Notably, AAX is the world’s first digital currency exchange that will be built on LSEG’s trading platform.

At present, the Hong Kong (HKEX) and Singapore (SGX) Stock Exchanges are using “matching engines” developed by the LSEG. Integrating the institutional-grade trading software onto its exchange platform will allow the ATOM Group to provide “high performance, reliable and trusted services to investors”, the announcement noted. Institutional investors have not yet made substantial investments into digital assets because they are concerned about the lack of proper security on centralized crypto exchanges.

LSEG's Millennium Exchange "Matching Engine"

Commenting on the importance of providing reliable and high-performance trading solutions, Ann Neidenbach, the chief information officer (CIO) at LSEG Technology, remarked:

We are delighted to have been selected by ATOM to provide a best-in-class technology solution to help power its new exchange. It underlines Millennium Exchange's reputation for performance, scalability, flexibility and reliability and we look forward to working with the AAX team ahead of the launch in H1 2019.

Crypto market analysts are expecting more regulatory clarity this year and a greater level of transparency. Acknowledging the need for compliance and better trading tools, Peter Lin, the CEO of ATOM Group, said:

The digital asset marketplace faces a critical need for more industry best practice in order to build greater investor confidence. AAX will leverage LSEG Technology's platform and expertise to deliver a world-class exchange that provides fair, trusted and secure digital asset trading for all.

In mid-October 2015, Carlson Tong Ka-Shing, the head of Hong Kong’s Securities and Futures Commission (SFC), had said the special administrative region was planning on tightening crypto regulations for local exchanges. Ka-Shing explained that there had been increasing concerns about the risks associated with trading on unregulated platforms.

Expecting Greater Institutional Involvement

Due to increased regulatory oversight expected this year, it’s likely that new and existing crypto exchanges in Hong Kong and in other jurisdictions will be implementing improved security measures. Anticipating greater participation and contributions from institutional players, Ling noted: 

With institutions such as Fidelity Investments entering the market and others also gearing up for entry, we predict the digital asset class is primed for entry by institutional and mainstream investors in 2019.

Notably, the “agreement with LSEG Technology” will allow AAX to offer:

  • “Institutional-grade technology” as used by established traditional exchanges including the LSEG, HKEX and SGX,
  • “Scalable, compliant platform” as used by regulated markets worldwide, and
  • “Industry standard process and operational excellence.”

The AAX platform will also reportedly “leverage global security” tools provided by Kroll, an online security solutions provider.

Binance ‘Unknowingly’ Earns $775K via Staking, Set to Launch Huge XLM Giveaway

On Thursday (July 18), Binance, the world's largest cryptoasset exchange (by adjusted trading volume), made a rather interesting announcement: it had "unknowingly" earned 9.5 million Stellar Lumen (XLM) tokens through staking rewards, and it is going to give all of it away to all Binance users who maintain XLM balances between July 20 and September 1.

Binance explained via a blog post that in August 2018 the Binance team followed the advice of the Stellar Development Foundation "to change some parameters on both cold and hot wallets," which resulted in the exchange "unknowingly" earning staking rewards for its XLM holdings since 31 August 2018.

Then, this week, while the Binance team was considering the idea of adding support for XLM staking, it found out that Binance had earned around 9.5 million XLM tokens (each of which was worth approximately $0.08157 at the time). Binance notes that all "weekly staking rewards between then and now are documented on the blockchain." 

So, the team made two decisions:

  • add support for XLM staking to Binance.com; and
  • give away the aforementioned staking rewards to the Binance community (i.e. Binance users).

This is not the first time that Binance has added staking support to Binance.com. The exchange already "distributes NeoGas for NEO holders, Ontology Gas for Ontology holders, VTHO for VeChain holders, and BitTorrent tokens for TRON tokens."

Here is how this 9.5 million XLM giveaway is going to happen.

From July 20, Binance will support XLM staking. Between this date and September 1, Binance will take "daily snapshots" of XLM balances in Binance user accounts.

Then, on September 1, Binance will "tally average user XLM balances based on these snapshots," and process the distribution of staking rewards to these user accounts (that maintained XLM balances during the staking period). Furthermore, the roughly 9.5 million XLM tokens that Binance has unknowingly earned to date will be distributed as a bonus payment to all Binance users who jave maintained non-zero XLM balances since July 20. 

Binance says in its blog post that it estimates this "one-time distribution of 9,500,000 XLM shared proportionately among Binance users" to be worth "10 to 12 months of typical monthly rewards."

According to a support article published on July 18, here are the details of Binance's "Monthly XLM Staking Airdrop Program":

  • Binance will start these daily XLM balance snapshots at 00:00 (UTC) on 20 July 2019.
  • This is how Binance will calculate the XLM staking distribution:

XLM generated by each user = Total XLM staking rewards received by Binance * User XLM holdings ratio. User XLM holdings ratio = User XLM holdings / Total XLM staked by Binance.

  •  In order to qualify for XLM staking rewards, Binance users must have a balance of at least 10 XLM.
  • This initial distribution of XLM staking rewards will be calculated until 1 September 2019, "with the total amount distributed equal to the staking rewards accrued on holdings during the 43 day period."
  • These XLM staking rewards are calculated on a daily basis and are distributed monthly. 
  • XLM distrubutions will be "completed before the 5th of each month."

In other Binance news, another support article explained that Binance's Margin Trading platform has added support for two margin assets (EOS and LINK), three borrowable assets (BNB, EOS, and LINK), and three margin pairs (EOS/USDT, EOS/BTC, LINK/USDT, LINKBTC).

Binance's announcement about its 9.5 million XLM giveaway may have helped the XLM price. According to CryptoCompare, XLM is currently trading at $0.08914, up 7.96% in the past 24-hour period:

XLM-USD 24-Hour Chart on 18 July 2019.png

Featured Image Courtesy of Binance