Bitcoin derivatives clearinghouse LedgerX has announced that the first bitcoin derivatives trades have taken place on its platform – an important milestone for the nascent digital currency market that could open the door to more institutional involvement and, some say, the creation of the first bitcoin-focused ETF.
LedgerX confirmed rumors that it had already started clearing bitcoin derivatives trades in a statement provided to CoinDesk and a handful of other media outlets. According to figures provided by the company, LedgerX facilitated trading in 176 swaps and options contracts in its first week, an amount with a notional values of more than $1 million, according to CEO Paul Chou.
“This week, a new standard is set for transparency, oversight and counter-party assurance. Institutional investors and traders can now rely on a guaranteed clearing and settlement process when transacting bitcoin contracts,” Chou said.
As CoinDesk points out, while the initial LedgerX trades appear to be exclusively bitcoin focused, the details of the license granted to the company by the CFTC in July allow for the creation of derivatives for other digital currencies as well. The company is reportedly working with options trading shops, asset managers, hedge funds, bitcoin miners, family offices, investment banks and virtually anybody else interested in helping it create a market for the new contracts.
“Our regulated, institutional-grade platform enables participants who were sitting on the sidelines, to enter the digital currency market.”
LedgerX is licensed as both a swap execution facility (SEF) and a derivatives clearing organization (DCO).