Cryptocurrency derivatives platform LedgerX is planning to launch physically delivered bitcoin futures to the United States market.
According to a April 15 Coindesk report, LedgerX has already applied for a designated contract maker (DCM) license with the US regulator. The company is planning to offer the service to its retail customers and will list Bitcoin options and futures on its new platform called Omni.
“We’ll be able to service customers of any size, we won’t be restricted to [institutional clients],” Juthica Chou, co-founder and COO of the company, told Coindesk. “Once the platform had proved stable and we got an operational cadence, we filed for a license with the CFTC.”
Along with trading, the new platform will also offer secure custodian services. Launched earlier this month, Omni is built on LedgerX’s existing infrastructure, that means it will use the company’s existing liquidity pool as well.
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“We’re custodying [bitcoin] in the same way that we currently do, we’ve obviously been live and operational for more than a year and a half, and we have a license from the CFTC, the DCO license, that allows us to custody bitcoin,” Chou added.
A huge rush in the market
This move by the New York-based company came at a time when many market players – Bakkt, ErisX, Seed CX, and CoinFLEX – are moving towards the crypto futures market. Earlier this year, CoinFLEX launched physically-delivered Bitcoin futures for its retail clients based in Asia.
Intercontinental Exchange (ICE) is also pushing to offer physically-delivered Bitcoin futures in the US market. However, many setbacks forced the company to delay the launch for four times.
While trading in physically-delivered futures, traders are paid in Bitcoin at the expiration of the contract, whereas for cash-delivered instruments, the settlement money is paid in fiat.
In late 2017, two US-based exchanges – CBOE and CME Group – launched cash-settled Bitcoin futures in the US market. Since then it has become a very lucrative market as, earlier this month, CME Group reported record trading volume of its Bitcoin futures.