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America's newest stock exchange is gunning for NYSE and Nasdaq's marquee business (ICE, NDAQ)

Upstart exchange IEX is going after the listings business of the New York Stock Exchange and Nasdaq, but the firm's legacy rivals say they are prepared for the competition.

IEX, the startup made famous in Michael Lewis' popular book "Flash Boys," officially became an exchange a little over a year ago, and now it's looking to lure companies from the NYSE and Nasdaq to move their listings on to its exchange.

It's a direct assault on its rivals' most visible business, and it's an effort IEX is going all in on. The firm is willing to cover the listings cost of companies which announce their intent to switch over to their exchange within 120 days , the Securities and Exchange Commission. Such firms will get at least $250,000 in fee credits. The exchange operator thinks such an incentive is necessary to break into the market, which NYSE and Nasdaq dominate.

"As proposed, IEX’s fee credit is designed to address these significant competitive challenges, and quickly establish a strong reputation for high-quality listings," the firm said in an August 31 filing.

Companies which decide to list on IEX will be charged a flat annual fee of $50,000, according to the filing. In other words, given the $250,000 in fee credits, companies that move their listing to IEX might not have to pay anything for five years.

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The NYSE and Nasdaq, in contrast, both charge companies based on how many shares they have outstanding in the market. The idea is companies with more shares will require more services from the exchange. But IEX says this isn't necessarily the case.

“Listing on IEX puts flexibility and control back in the hands of companies," Rather than charging fees based on arbitrary calculations and services companies tell us they don’t value, we’re providing a high-quality offering at a simple, reasonable cost,"

There's a lot on the line for IEX. A boost in the number of companies listed on IEX will likely translate into a boost in the amount of trading that takes place on the exchange, as stocks are more likely to trade on the exchange on which they are listed, particularly when the market opens and closes. This could help boost IEX's 2% market share. In addition, having a well-known company switch would represent an endorsement of IEX's market model, and help further boost its visibility.

IEX is looking to launch its listings business as soon as October, according to a spokesperson. Steve Wynn, the casino magnate and an investor in IEX, has previously said he would consider moving Wynn Resorts to IEX. Already, the IEX sales team is in talks with some companies listed on Nasdaq, according to Nelson Griggs, the president of the Nasdaq Stock Exchange.

Still, there's no doubt that IEX faces a capricious path ahead. Together, the NYSE and Nasdaq possess a near total duopoly over the US listings market. And their listings teams say they are ready for the challenge IEX poses.

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In a recent interview with Business Insider, Griggs said he takes every competitor seriously, but he's very confident in Nasdaq's position over IEX.

"So when we talk about what people want in a listing venue, it is what we provide across 2,700 companies: the right surveillance, the right liquidity, market share, and visibility," he said. "All these things, we think, make up the guts of our value proposition."

"And we think it stands up pretty well against IEX," he concluded.

John Tuttle, the 35-year-old head of global listings at the NYSE, told Business Insider in an interview that he's not focused on chasing the competition. He's more concerned about delivering more value to the exchange's customers.

"That is what we've been doing for 225 years," he said. "That's what we continue to do every day."

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The NYSE is putting its money where its mouth is. Here is Tuttle on some of the improvements the exchange is working on:

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