By Michael J. Casey

Nasdaq OMX Group Inc. has agreed to provide New York-based startup Noble Markets with core technology to power a new marketplace aimed at allowing companies and institutional investors such as hedge funds to trade bitcoin and related digital-currency assets.

According to a joint statement provided to The Wall Street Journal, Noble’s platform will use Nasdaq’s X-stream trading system, a high-tech system for matching market participants’ orders that is used by more than 30 exchanges and marketplaces worldwide. Nasdaq NDAQ, -1.59% will also provide marketing support.

In an interview, Noble Chief Executive John Betts said he believes Nasdaq’s involvement will help dispel investors’ concerns about the risks of trading in digital currencies. “They can say, ‘These are sophisticated organizations; they have done their due diligence, and if it’s good enough for them, it’s good enough for us.”

Betts has previously headed the development of electronic trading platforms at Goldman Sachs GS, +0.01% , Morgan Stanley MS, -0.33% and UBS UBS, -1.95% . His company is backed by venture capital firms Blockchain Capital of San Francisco and Tally Capital of Chicago.

An expanded version of this report appears at WSJ.com.