New York stock exchange owner, Intercontinental Exchange, is likely to get regulatory approval for a futures contract redeemable for cryptocurrency, according to a report out in the US this morning.
Regulated Bitcoin futures began trading in December last year as the price of Bitcoin hit its peak.
Bitcoin futures allow speculators to buy a contract that gives them the right to buy or sell Bitcoin at a future date, at an agreed price – however all current Bitcoin futures in the US settle in fiat, rather than Bitcoin.
The Wall Street Journal reports Intercontinental Exchange expects approval in early 2019 for its new Bitcoin futures contract that will settle in Bitcoin.
“It’s great to have cash-settle, but there’s a need for physical delivery,” said Kelly Loeffler, CEO of Intercontinental Exchange’s crypto business, Bakkt.
Listen to our CEO Kelly Loeffler and @ICE_Markets founder Jeff Sprecher discuss the institutionalization of crypto and their plans to bring digital assets to Wall Street, from @coindesk’s #ConsensusInvest
— Bakkt (@Bakkt) December 14, 2018
Approval for the futures contract is currently being considered by the Commodity Futures Trading Commission (CFTC).
CFTC laws require all US future contracts to be redeemable for dollars, securities or commodities, but it’s understood the commission will make an exemption to allow the Bitcoin futures contract to pay out in Bitcoin.
Intercontinental Exchange first revealed its intention to develop futures redeemable for Bitcoin in August this year, when the Bakkt digital assets platform was unveiled.
Bakkt’s launch, which is seen by a many as an important price catalyst for Bitcoin, is expected in late January 2019.
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