New York-based LedgerX, an institutional trading and clearing platform, announced today it has been regulatory approval from the U.S. Commodity Futures Trading Commission (CFTC) to clear and settle derivative contracts for digital currencies.
The ruling makes LedgerX the first U.S. federally regulated digital currency derivatives exchange and clearing house. The Company can now provide clearing services on fully-collateralized digital currency swaps. Eligible participants include broker dealers, financial institutions, commodity pools and qualified accredited investors.
The company says it has initial plans to list one-to-six month options contract for Bitcoin. Long-term the imagines listing three to five cryptocurrencies.
“Having a regulated clearing house will open the market to a lot of other investors such as the large institutions,” said LedgerX CEO Paul Chou. “A proper regulatory framework will open up the market and make them comfortable.”
The regulatory process took nearly three years to gain approval and comes just one month after the CFTC formally registered LedgerX as an official swap execution facility.
Former CFTC commissioner Mark Wetjen sits on the board of directors for LedgerX’s parent company Ledger Holdings.
In May LedgerX closed a US$11.4 million financing backed by Miami International Holdings Inc. and Huiyin Blockchain Venture Investments. Huiyin is the wolrd’s largest venture capital fund dedicated to cryptocurrency and blockchain startups.