The United States Commodity Futures Trading Commission announced Monday that it has formally approved LedgerX LLC’s bid to become the nation’s first federally regulated derivatives clearing organization. The decision was the result of a unanimous vote by Commission members, and provides LedgerX with the legal authorization it needs to begin offering digital currency options sometime within the next few months.
The decision by the CFTC means that LedgerX can now act as an authorized clearing house for digital currency options, providing investors with expanded access to those offerings. According to reporting from Bloomberg, the company intends to begin such options contracts toward the end of the summer – beginning with Bitcoin-to-dollars, and venturing into other digital currencies over time.
LedgerX had previously been approved for digital currency trading. Now, the company’s new options offerings will provide major institutional investors with a way to hedge their bets in the volatile cryptocurrency trading markets. LedgerX CEO Paul Chou told Bloomberg that he expects this move to draw in new investors who have been reluctant to expose their assets to that volatility. He also noted the achievement’s broader implications:
“It’s an important milestone for the digital currency market broadly. This will pave the way for others globally to look at the space and the appropriate way to regulate a new market like this.”