(Bloomberg) --
Crypto exchange FTX US agreed to take a stake in IEX Group Inc., owner of the stock exchange made famous by “Flash Boys,” as they team up on technology and regulatory efforts to expand access to digital assets for retail and institutional investors.
The companies plan to collaborate on building a market structure for trading crypto securities and work closely with regulators, according to a statement Tuesday. FTX US declined to disclose terms, saying it will be a “significant investor” in IEX. The deal is set to close next month, subject to regulatory approval and other conditions.
“With this investment, we're aligned with one of the most trusted and innovative companies in equities markets,” Sam Bankman-Fried, chief executive officer of FTX and FTX US, said in the statement.
Crypto and traditional financial markets are moving closer together. The partnership with FTX is the first substantial push into trading digital assets for IEX, the exchange operator featured in “Flash Boys,” the Michael Lewis book about high-frequency trading. The firm will provide entry points for institutional investors to access digital assets, spokesperson Vera Newhouse said in an interview. FTX US is entering into equities trading, and has also made a push for institutional clients.
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IEX has taken less market share than its public rivals such as Nasdaq Inc. and Intercontinental Exchange Inc.'s New York Stock Exchange. The firm represented 2.7% of U.S. equities volume in March, compared with Nasdaq's more than 17%, according to data compiled by Bloomberg.
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