- LedgerX has filed for a designated contract market license (DCM) with the CFTC
- LedgerX says its bitcoin futures products will be powered by its proprietary Omni platform
- LedgerX claims that more than 200 firms are currently invested in its physically-delivered swaps product
LedgerX, a bitcoin derivatives platform regulated by the United States Commodity Futures Trading Commission (CFTC), has announced plans to launch own physically-settled bitcoin futures contracts that would be available to both institutional and retail customers, according to reports published April 15, 2019.
LedgerX to May Launch Bitcoin Futures before Bakkt and others
At a time when several highly reputed firms including Bakkt, ErisX, Seed CX, and CoinFLEX are waiting on the U.S. financial watchdogs to greenlight their bitcoin-powered investments vehicles, LedgerX has revealed that its physically-delivered Bitcoin futures contracts may be the first to go live, as it’s currently in constructive talks with the CFTC.
According to Juthica Chou, co-founder of LedgerX, the firm applied for a license to offer bitcoin futures contracts earlier in November 2018 and it has held positive discussions with the regulator since then.
Unlike some of the firms that are also waiting to get a positive response from the regulators, LedgerX has already secured two licenses from the CFTC, enabling the company to function as both a Swap Execution Facility (SEF) and a Derivatives Clearing Organization (DCO).
In essence, there is a huge possibility that the CFTC could grant LedgerX a DCM license based on the firm’s sterling track record.
The Game Changer
If all goes as planned, LedgerX will be the first firm to launch a physically-delivered bitcoin futures contracts. Unlike the futures contracts offered by the Chicago Mercantile Exchange (CME), where investors receive the fiat U.S. dollar equivalent of BTC at the expiration of the contract, LedgerX will settle clients with real bitcoins.
At current, LedgerX says more than 200 institutional clients are invested in its physically-delivered swaps products, and as such, it firmly believes it has an edge over other companies interested in offering physically-settled bitcoin futures.
Explaining the reason behind its decision to open its doors to retail clients unlike its other direct competitors who are only focused on institutional investors, Chou reiterated that:
“I think at this current time we don’t see the demand growing among institutional investors and banks. Bitcoin has an $85 billion market cap, which is just the size of large stock. Right now we see the opportunity at the other end of the spectrum.”