The Commodity Futures Trading Commission (CFTC) is considering to approve futures instrument based on Ethereum if it complies with all the necessary requirements, Coindesk reported on Monday.
“I think we can get comfortable with an Ether derivative being under our jurisdiction,” an unnamed CFTC official confirmed the publication. “We don’t do bold pronouncements, what we do is we look at applications before us.”
“A derivatives exchange comes to us and says ‘we want to launch this particular product.’ … If they came to us with a particular derivative that met our requirements, I think that there’s a good chance that it would be [allowed to be] self-certified by us.”
The regulator, however, will only respond to the individual applications rather than publicizing an opinion on the investment product.
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Pumping the market with more crypto products
The CFTC has already approved and oversees Bitcoin futures products – one issued by the Chicago Board Options Exchange and the other one by the CME Group. Both exchanges launched the cash-settled instrument in December 2017 which drove the digital coin to touch its peak.
Ethereum is the second largest digital coin in the market in terms of total market capitalization. Though the altcoin lost its position several times to XRP, it has now tightly secured its place with a $17.4 billion market cap, at least for the time being.
The introduction of Bitcoin futures has turned out to be a massive success. The investment product has brought in many institutional investors to bet in digital assets. Though the crypto spot market slumped since January 2018, the trend is different for futures.
Last month, the CME Group reported that it has recorded the highest BTC futures trading volume on April 4 with a sudden upward trend in the spot market.
Meanwhile, the Securities and Exchange Commission (SEC) is still reluctant to approve a Bitcoin-backed exchange-traded fund (ETF). And if the CFTC approves Ethereum-based futures, it will definitely get an upper edge to seize control of the crypto market in the US.