A new Texas exchange won backers including BlackRock and market-maker Citadel Securities.
Ex-London Stock Exchange CEO Xavier Rolet explains the move in a US-dominated trading landscape.
BlackRock and speed trading firm Citadel Securities are backing a new stock exchange in Texas designed to challenge giants such as the New York Stock Exchange.
Founder and CEO of TXSE Group James Lee, who posted the plans on LinkedIn, said the companies are among the deep-pocketed backers of the Texas Stock Exchange, to be based in Dallas.
The new bourse’s $120 million in fundraising makes it the most well-capitalised exchange to file a registration with the Securities and Exchange Commission, he said.
“Investors behind it mean to pressure exchanges on fees and seek to disintermediate them too, if they can, as they hold themselves to be a large source of liquidity and flows in their own right,” Xavier Rolet, former CEO of the London Stock Exchange said.
Sean Stein Smith, a professor at the City University of New York and board member at the Wall Street Blockchain Alliance, agreed. The move sends a message that Blackrock and Citadel want to compete with New York exchanges, he said.
TXSE will list public companies and facilitate trading in what it calls “the growing universe” of exchange-traded products. These are cheap and accessible offerings that typically index a basket of securities.
BlackRock, the world’s biggest money manager with $10 trillion in assets, has already shaken up one industry this year: crypto.