It’s likely that Bakkt will soon face plenty of competition. Chicago-based crypto exchange ErisX has launched its own physically-settled Bitcoin futures contracts, meaning investors receive real cryptocurrency and not the cash equivalent.
ErisX, which is backed by US brokerage TD Ameritrade, has been granted two different regulatory designations, a derivatives clearing license and a designated contract market (DCM) license. The approvals meant the company could launch its BTC futures, which are traded at and cleared through Eris Exchange Llc (CFTC-registered DCM) and Eris Clearing Llc (CFTC-registered DCO).
While its contracts will vie with the Bakkt’s futures in trading physically delivered Bitcoin, ErisX is the first digital asset exchange to offer both spot and futures markets on the same platform. Both platforms will likely go head-to-head, as the startups inherently have similar goals and plan to introduce the crypto assets to retail investors.
ErisX’s first spot trading product, which includes Bitcoin, Bitcoin Cash, Ehtereum, and Litecoin, went live in April.
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The two-year startup added that its products would be available next year via US brokers licensed as futures commission merchants (FCMs). Once launched, at least 11 million of TD Ameritrade’s customers will gain access to ErisX products, which would be another step towards the mass adoption of crypto assets.
Making Bitcoin a mainstream investment
ErisX was among four regulated trading platforms in the US vying to become the first to launch physically-delivered bitcoin futures.
“We met aggressive goals this year as we closed funding, strengthened the team, secured state-level money transmitter licenses, and also developed modern infrastructure including a brand new matching engine and futures clearing system from scratch,” said Thomas Chippas, CEO of ErisX.
Earlier this year, ErisX has concluded a funding round raising more than $27 million from major financial institutions like Bitmain, ConsenSys, Fidelity Investments, and Nasdaq Ventures. The startup says it will offer investors the ability to trade Bitcoin, Bitcoin Cash, Ethereum, and Litecoin on spot and futures markets, subject to regulatory approval.
The company is also backed by DRW, Virtu Financial, and CBOE Global markets to offer a derivative and investment vehicle exchange that will take a focus on crypto assets.