Chicago Board Options Exchange will launch margin trading in BTC and ETH futures
The service will be available to users in the second half of 2023
06.06.2023 - 08:20
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(Bloomberg) -- Traders on Cboe Global Markets Inc.’s digital-asset exchange will soon be able to enter into margined Bitcoin and Ether futures contracts after the firm received a critical regulatory sign-off on Monday.
Cboe Digital won approval from the Commodity Futures Trading Commission to offer physically and financially settled margined contracts beginning in the second half of this year, according to a statement.
The exchange has so far offered only fully collateralized trading of crypto futures. Those agreements require clients to put up the entire amount of a contract before trading. Margined trading will allow traders to post less capital when opening a position. Physical settlement of digital assets will let traditional financial firms access Bitcoin or Ether futures without intermediaries having to take custody, Cboe Digital President John Palmer said.
“That’s where the concept of us also having a spot market has advantages,” Palmer said. “We didn’t want to have to force participants to custody or touch the physical asset.”
Cboe Digital is the only US-registered exchange that allows for both spot and derivatives trading of digital assets including Bitcoin, Bitcoin Cash, Ether, Litecoin and USDC. It also operates a clearinghouse.
The exchange has signaled it wants to grow the number of tokens currently trading on the platform. The margined contracts would require the use of an independent futures commission merchant as an intermediary.
The exchange’s client base is primarily professional or institutional players. Firms including DRW, Galaxy Digital, Interactive Brokers and Robinhood Markets Inc. became minority investors in the crypto platform last year.
This material is taken from the website https://www.bnnbloomberg.ca.
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