CFTC Approves LedgerX to Settle Futures in Real Bitcoin

The Commodity Futures Trading Commission has cleared bitcoin derivatives provider LedgerX to offer physically settled bitcoin futures contracts.

The CFTC said Tuesday it had approved LedgerX's application for a designated contract market license, meaning the company can now offer the new futures contracts.

LedgerX is the second company to receive approval to offer physically settled bitcoin futures; other firms, such as Intercontinental Exchange's Bakkt, Seed CX and ErisX plan to enter this market.

Unlike the cash-settled bitcoin futures listed by the Chicago exchanges Cboe and CME, in physically settled futures the buyer receives the underlying commodity when a contract expires, rather than the fiat equivalent.

Monday's approval means that New York-based LedgerX can not only list these bitcoin futures contracts but crucially can offer its products to retail clients, not just institutional ones.

No timeline was provided for when LedgerX might start to offer futures.

While Bakkt has previously announced that it would be testing its own physically-settled bitcoin futures contracts in July, a firm launch date has yet to be announced.

Seed CX and ErisX have likewise not yet announced when they would launch their futures products.

LedgerX applied for the DCM in November 2018 and has since been working with the CFTC. It already offers swaps and options contracts for customers.

LedgerX is now eyeing a gradual rollout of its new products, including its retail-focused Omni platform.