The World Federation of Exchanges publishes research on exchange engagement with crypto market functioning & development

London, 5 September 2023 – The World Federation of Exchanges (The WFE), the global industry group for exchanges and central counterparties, has published the first of a two-part research project which analyses exchange engagement with crypto market developments. The Paper’s objective is to improve understanding of the benefits and risks of crypto market infrastructures and how they function.

The WFE Research paper analyses exchange interaction with the evolution of crypto-trading platforms across various jurisdictions and the opportunities or challenges that these new technologies bring. It studies how demand for crypto-related products and services is changing, and how regulated exchanges are responding to the opportunities and challenges posed by these technologies, including with the creation of regulated crypto-trading exchanges or the provision of crypto-related services.

Crypto-trading platforms have operated without the standards required from established public financial markets and with very little regulatory oversight. The WFE Research paper, titled, ‘A review of crypto-trading infrastructure’, studies how this offers a greater opportunity for illegal financial activities and the consequences for market integrity, and for investor protection.

The paper finds that the risks that unregulated crypto-trading platforms bring are compounded by the fact that they frequently carry out further activities that would not be permitted, or would be closely regulated, in mainstream public markets.

The Research studies the implications that the differences in model design between decentralised platforms (DEX) and centralised platforms (CEX) have on liquidity provision, price discovery and the custody of assets. It also analyses what these differences imply for fundamental aspects of financial markets regulation: anti-money laundering, prudential regulation, investor protection, and may imply for financial stability.

Dr Pedro Gurrola-Perez, Head of Research at the WFE, said: “There is a growing demand for crypto products and services. Crypto-related innovations are seen as an opportunity to advance technology development and increase investor choice, however, the lack of minimum governance and investor protection standards of unregulated crypto platforms, as well as the high volatility observed in these markets, and the risk of cybersecurity threats, is a concerning mix.”

Nandini Sukumar, CEO of the WFE, said: “Crypto is at the forefront of all of our members’ minds and we are in constant dialogue with them about how to capitalise on the new opportunities in the area. As this industry and market matures, coming in to the mainstream of financial markets, the exchange-traded model which places investor trust, transparency, accountability and investor protection at the heart of platform, will gain further momentum. ”

You can download the full report here.

For more information, please contact:

Cally Billimore 

Communications Manager 

+44 7391 204 007

[email protected]

About the World Federation of Exchanges (WFE):

Established in 1961, the WFE is the global industry association for exchanges and clearing houses. Headquartered in London, it represents over 250 market infrastructure providers, including standalone CCPs that are not part of exchange groups. Of our members, 34% are in Asia-Pacific, 45% in EMEA and 21% in the Americas. WFE’s 90 member CCPs and clearing services collectively ensure that risk takers post some $1.3 trillion (equivalent) of resources to back their positions, in the form of initial margin and default fund requirements. WFE exchanges, together with other exchanges feeding into our database, are home to over 50,000 listed companies, and the market capitalisation of these entities is over $100 trillion; around $140 trillion (EOB) in trading annually passes through WFE members (at end 2022).

The WFE is the definitive source for exchange-traded statistics and publishes over 350 market data indicators. Its free statistics database stretches back more than 40 years and provides information and insight into developments on global exchanges. The WFE works with standard-setters, policy makers, regulators and government organisations around the world to support and promote the development of fair, transparent, stable and efficient markets. The WFE shares regulatory authorities’ goals of ensuring the safety and soundness of the global financial system.

With extensive experience of developing and enforcing high standards of conduct, the WFE and its members support an orderly, secure, fair and transparent environment for investors; for companies that raise capital; and for all who deal with financial risk. We seek outcomes that maximise the common good, consumer confidence and economic growth. And we engage with policy makers and regulators in an open, collaborative way, reflecting the central, public role that exchanges and CCPs play in a globally integrated financial system.


Twitter: @TheWFE


For more information, please contact:

Cally Billimore
Manager, Communications
Email: [email protected]
Phone: +44 7391 204 007
Twitter: @TheWFE