Major names in crypto are calling foul as some of the United States’ largest financial firms launched an exchange for digital assets today.

Wall Street giants Fidelity Digital Assets, Charles Schwab and the market-making behemoth Citadel Securities are behind EDX, a non-custodial crypto exchange. EDX will offer trading on BTC, ETH, and other major digital assets, according to a press release.

Caitlin Long, an influential Wall Street veteran who is currently the CEO of the digital assets-focused Custodia Bank, told The Defiant it’s not a coincidence that the firms are launching an exchange in the wake of enforcement actions that have rocked digital assets space this year.

“All of a sudden we’ve got these big Wall Street firms that are coming into crypto right after the runway’s been cleared,” she said.

Long named Coinbase, which the SEC sued this month, as a prime example of the enforcement actions which may have opened the way for the new exchange.

United States agencies, particularly the SEC, have charged crypto companies like Coinbase and Binance’s U.S.-based operations, with violating securities law. They also continue to push forward rulemaking which crypto’s proponents have said is ill-fitted to the technology.

Bullied Participants

Similar perspectives to Long’s ricocheted around crypto-focused social media accounts on Tuesday as the news of EDX’s launch hit.

Investor Adam Cochran said large financial firms have “bullied out participants so they can scoop up cheap coins.”

Blackrock, the world’s largest asset manager, also applied to launch an ETF for Bitcoin last Thursday. Numerous crypto-native companies have submitted applications to launch a spot Bitcoin ETF and none have been approved.

Incumbency Bias

Long believes that if BlackRock’s application is approved, it will spawn intense controversy.

“If that one is the one that breaks through, will you have a lot of people across the entire spectrum of the crypto industry, but far beyond the crypto industry, standing up and screaming, saying, ‘what the heck?’” she said.

“It sure appears that there’s an incumbency bias,” the CEO added, suggesting that regulators are favoring established companies’ forays into crypto, rather companies geared toward the digital asset industry from the get go.

Raging Funeral Pyre

To be sure, Long said she doesn’t believe digital asset projects are without fault.

“I’m not defending everything that this industry has done,” the CEO said. “In fact, the vast majority of it needs to burn on a raging funeral pyre.”

And intentions to launch EDX did become public last year, so it’s not true to say that the exchange’s backers had waited until this moment to start developing their platform. That hasn’t stopped Long, and many others in the crypto space to question whether there has been a degree of coordination between regulators and Wall Street firms.

But  blockchains are going anywhere, despite the regulatory hurdles and what she sees as favoritism towards incumbent financial institutions, Long said. “Nothing’s stopping the base layer blockchains,” she said.