LCX has expanded the service offering of the LCX Terminal platform by additional price referencing features, which will be supervised by the Financial Markets Authority as per the Blockchain Act.
Liechtenstein-based Cryptoassets exchange LCX has launched its LCX Cryptocurrency Reference Price Services, including four different reference prices, called the LCX Bitcoin Reference Price (BRP) in USD and Euro and the LCX Ethereum Reference Price (ERP) in USD and Euro.
The LCX BRP is a daily reference price of the U.S. dollar price and Euro price of one bitcoin. Each day, the LCX BRP aggregates the trade flow of major bitcoin spot exchanges during a specific one-hour calculation window and LCX publishes the price at 16:00 (4 Pm) CET.
The reference price in U.S. dollar is calculated based on the data from Bittrex, Bitfinex, Kraken, Coinbase Pro, Liquid, and Gemini. The BRP-EUR is calculated based on the four exchanges Bitfinex, Kraken, Coinbase Pro, and Liquid.
The LCX ERP is also published in both the U.S. dollar and the Euro, and LCX will also publish it at 16:00 (4 PM) CET every day. The Dollar and Euro ERPs are based on data from the same exchanges as the BRPs.
Reference prices increase market transparency
Exchanges publish reference prices to increase transparency and strengthen the market participants’ confidence in the trading process. On traditional exchanges, they are usually used for calculations such as opening prices, delayed opening, or trading stops. On crypto exchanges, trading occurs 24/7, but traders still need a credible reference price for their risk management of digital assets.
LCX added the new LCX Cryptocurrency Reference Prices to its existing range of price referencing features and proprietary solutions on the LCX Terminal platform. According to LCX, “following positive feedback and encouragement from our users, we are taking our pricing services to the next level. […] LCX Cryptocurrency Reference Price Services are designed to help accelerate the professionalization of digital asset trading.”
FMA Liechtenstein is supervising TT Reference Price Services
Since January 2020, Cryptocurrency Reference Price Services in Liechtenstein are regulated by the Blockchain Act as Trustworthy Technology Reference Price Services. According to Liechtenstein’s Blockchain Act (TVTG), the TT price service provider is “a person or entity providing TT system users with aggregated price information based on buy and sell offers or completed transactions.” LCX’s additional services fall into the same category, which means they are supervised by the Liechtenstein Financial Market Authority (FMA).
LCX writes in an announcement, „As a blockchain-based service provider in Liechtenstein, LCX AG and our services naturally fall within the scope of the new Blockchain Act that came into effect in 2020. As a part of the transitional period, that is applicable to those Liechtenstein-based service providers that commenced their operations prior to 2020, LCX has formally notified FMA about all our existing services, and continues a very productive and positive dialog with our highly esteemed regulatory body to ensure that all our operations, services and activities are conducted in full compliance with applicable regulatory provisions.”