The US-based company Riot blockchain has filed with SEC to launch a new regulated digital currency exchange called RiotX in the U.S. by the end of Q2 2019. The regulator published the documents on 14th March.
The company states in the filing that its subsidiary, RiotX Holdings Inc, would operate the new exchange. Moreover, the exchange’s banking services would be managed by an Application Programming Interface (API) developed by software company SynapseFi.
The API is intended to, among other functions, serve as a security improvement by tracking user location to prevent fraudulent use of the service. For example, inappropriate use would include the use of the exchange in U.S. member states where it is not permitted, more specifically Hawaii and Wyoming.
RiotX users would be permitted to create accounts connected to accredited banking institutions in the U.S., and transfer and hold both fiat and digital currencies. As per the filing, the exchange will also be partnering with exchange software provider Shift Markets.
As reported in August 2018, the SEC had intensified its investigation into cryptocurrency mining firm Riot Blockchain, which first came to the regulator’s attention in April 2018.
The SEC’s investigation and subpoena information request started after Riot Blockchain changed its name to incorporate blockchain technology at the peak of industry hype, and turned their focus from biotechnology to mining. The regulator had earlier noted that firms that changed their name to include blockchain would face increased scrutiny.