Bittrex takes majority stake in Chicago fintech firm Seed CX.
Bitcoin hit the derivatives mainstream, but what about its other crypto cohorts?
On Tuesday, it was announced that Bittrex, a U.S.-based cryptocurrency exchange handling some $3 billion notional of transactions daily, took a majority stake in two-year-old Chicago fintech startup Seed CX for an undisclosed amount. Seed CX was originally launched with plans to trade industrial hemp derivatives on its CFTC-approved swap execution facility (SEF).
Now, Seed will apply its technology to spot and derivative crypto trading alongside corresponding settlement services for an institutional crowd. Notably, by using Bittrex’ underlying wallet technology, Seed CX will offer physical settlement and more than just bitcoin-based cryptocurrency trading. Currently, the firm is working on products for the major market cap cryptocurrencies, with more on the way. Bittrex and Seed CX remain separate companies with different operating structures.
Seed’s initial plan for industrial hemp trading (think the stuff for fiber, not marijuana on the street) was augmented by proposed trading of foodstuffs like organic avocados and limes. But those markets proved too underdeveloped to facilitate trading.
“It didn’t work out as we first thought, but we got skills and infrastructure we could leverage,” Seed CX Co-founder Edward Woodford said.
Seed CX is gearing up to operate in the crypto space more like a forex shop, with multiple fiat currencies accepted and all sorts of pairs traded. It will also offer FIX protocol to integrate with existing trade management systems.
While industrial hemp and cryptocurrencies may seem as related as apples and tires, Seed’s idea from the start was to find other new products/assets to apply its platform to. So letting Bittrex in the door is not as odd a move as it seems, especially when one considers global interest in cryptocurrencies. Everybody and their mother wants in on crypto today, but who’s talking about trading hemp by-products around the office water cooler?