LedgerX to launch Ethereum derivatives
LedgerX, which is an institutional Bitcoin derivatives platform, is reportedly planning to expand its products to include Ether options. The firm is reportedly waiting for approval from the Commodity Futures Trading Commission (CFTC) to list the new product and the rollout could happen if CFTC allows it during their meeting on October 5.
The company offers Bitcoin derivatives since October last year. The products are essentially one-day futures contracts settled in physical Bitcoins on expiry. They let users buy the right to buy or sell Bitcoin at an agreed future price. LedgerX introduced their Bitcoin derivatives products two months before CBOE and CME launched their Bitcoin futures.
Reportedly, CBOE is also working on an Ethereum futures product and Business Insider has reported this month that the company said the product is ready and they are waiting for regulators' node. CBOE president had already said in December last year that the company would expand futures offering to include Ether and Bitcoin Cash derivatives.
The new product will allow traders to short Ethereum in addition to Bitcoins. They can be used by investors and miners to hedge profits and reduce risks associated with price volatility in Ether. While Ethereum futures may lead in short term price decreases as is the case with Bitcoin futures, they could make institutions more comfortable dealing with the cryptocurrencies.
Meanwhile, the company reported last month that it registered a record amount of trading volume in June and July. It cleared $50 million in derivatives volume in July alone. LedgerX serves more than 130 institutions and high net worth individuals. Via "one-click button" service on LedgerX, institutional customers are able to buy Bitcoins easily on a regulated platform.