How Does the Regulatory Environment Differ for Custodial CEXs versus Non-Custodial RFQ Platforms?

Custodial CEXs often face stricter regulation, particularly concerning anti-money laundering, know-your-customer rules, and asset security standards, as they hold client funds. Non-custodial RFQ platforms, which merely facilitate matching, may have lighter regulatory burdens.

However, they are still subject to rules regarding fair dealing and market abuse, especially if they are deemed "Organized Trading Facilities."