CFTC Formally Registers New Cryptocurrency Swap Execution Facility


The US Commodity Futures Trading Commission (CFTC) has granted blockchain startup LedgerX its formal registration as a swap execution facility (SEF), making it the second firm ever to be granted the flexibility to commerce digital currency derivatives.

While a notable milestone, it is the newest in a long process for LedgerX that’s nonetheless removed from over. Still pending approval is the ultimate regulatory milestone to launching what may find yourself being the primary cryptocurrency choices agency licensed by the CFTC to do enterprise in any variety of cryptocurrencies, together with bitcoin and ether.

LedgerX CEO Paul Chou advised CoinDesk:

“We are pleased to have received full registration as a SEF from the CFTC for the trading of digital currency derivatives.”

Founded in 2013, LedgerX first acquired a brief approval to function as an SEF in 2015, however this newest improvement makes that call last. With immediately’s registration, LedgerX is now required to adjust to provisions set forth within the Commodity Exchange Act (CEA) and different rules particular to the CFTC.

New Jersey-based Tera-Exchange was registered as an SEF final yr.

As a part of the New York-based startup’s push to develop into the primary derivatives clearing group (DCO) registered to commerce cryptocurrencies, the agency earlier this yr raised $11.4m led by buyers Miami International Holdings and Huiyin Blockchain Venture Investments.

As a results of that capital, Chou believes LedgerX is on the cusp of making a cryptocurrency choices market that would enhance the variety of institutional buyers in a position to spend money on the asset class and assist stabilize the worth of the currency by enabling a extra dependable hedges.

“We look forward to working with the CFTC on finalizing the DCO registration,” he mentioned.

Editor’s Note: This article has been amended to indicate that Tera Excahnge was registered as an SEF final yr.

Image of commodities through Shutterstock

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