Due to the tremendous growth and demand for the cryptocurrency market, the London Stock Exchange (LSE) Group implemented products to offer Bitcoin derivatives shortly after successfully collaborating with Global Future & Options (GFO-X).
Thanks to the London Clearing House (LCH SA), the LSE group is set to provide Britain’s first completely regulated trading and clearing in Bitcoin index futures and options derivatives on the GFO-X platform.
However, Britain wants to shine as a global hub for crypto technology. In this context, earlier this year the U.K. publicly launched a consultation on future regulations for crypto assets, unfortunately, it is not yet regulated.
Global Futures & Options (GFO-X) is just a start-up, authorized by the Financial Conduct Authority of the United Kingdom. There are many institutional investors who are interested in betting on Bitcoin prices through derivative products like futures and options.
According to the press release of The London Stock Exchange’s Paris-based LCH clearing business, the LCH will launch DigitalAssetClear, an entirely new segregated clearing service for “cash-settled dollar-denominated crypto derivatives contracts” on GFO-X.
With LCH DigitalAssetClear, the new bitcoin index futures and options contracts will be cash settled. This cash settlement will depend on the Global Future & Options (GFO-X) / Coin Metrics Bitcoin Reference Rate (GCBRR). As a result, the company will have direct access to trade futures and options on the Bitcoin reference index.
Through this new asset class, DigitalAssetClear, clients can take advantage of its leading risk mitigation, settlement, netting, and margining capabilities under regulated conditions, which is expected to begin in the fourth quarter of 2023.
Arnab Sen, the CEO of GFO-X stated that “Recent market events in the trading of digital assets have highlighted the need for a safe, regulated venue where large financial institutions can trade at scale, while keeping their clients’ assets protected.”
Also read: CFTC Head Accuses Binance of Intentionally Flouting Regulations
