LedgerX outpaced Bakkt by launching bitcoin futures secured by real BTC

The American cryptocurrency platform LedgerX officially launched the first deliverable futures contracts for Bitcoin , overtaking Bakkt, supported by the Intercontinental Exchange, and ErisX, supported by TD Ameritrade. It is reported by Coindesk .

LedgerX offers a new product to both institutional and retail investors, allowing anyone who goes through the KYC procedure to trade futures contracts and receive "real" bitcoins , rather than their equivalent dollar value.

Platform CEO Paul Chow emphasizes that not only dollars can be used to buy contracts, but also bitcoins. According to him, this is the first regulated cryptocurrency platform, which allows customers to deposit bitcoin as a security under the contract.

Because of this, customers do not need to wait for bank transfers or tolerate other limitations of the US banking system:

“If a client uses Bitcoin, he will not have to deal with the US banking system at all. That is why deliverable futures are so important. I think this is one of the most unique uses for Bitcoin, where you use cryptocurrency as your sole security. ”

The US Commodity Futures Trading Commission (CFTC) provided LedgerX with the final authorization it needed.

“We have been in this business for the past six years, and we not only attract institutionalists to the industry, but also spent a lot of time explaining to regulators why this is so important. But cryptocurrencies are for everyone, and we never started by offering our product only to hedge funds or institutional clients , ”said Chou.

John Todaro, director of research at TradeBlock, told CoinDesk that cash settlement futures contracts could potentially be more manipulative depending on the underlying spot exchanges or indices used for calculations after the expiration date. However, Chou says that LedgerX does not compete with settlement contracts, because these types of contracts are completely different.

“We have a lot of people who don’t even touch the dollars. Settlement contracts are very different from what we do. ”

He added that the platform "will be a new product for retail traders, which will be unique in the sense that it will be incredibly simple."

Meanwhile, the Bakkt platform has independently certified its contracts through the CFTC and is now awaiting permission from the New York Department of Financial Services to create a trust. Once the statute of trust has been approved, Bakkt is likely to be able to start work within a few weeks.

ErisX, like LedgerX, also received the necessary CFTC permits, but has not yet announced the launch dates of its futures contracts.

Publication date 07/31/2019
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