A cryptocurrency exchange backed by Roger Ver is reportedly set to offer physical Bitcoin futures contracts to Asian investors as early as next month.
Physical Bitcoin Futures in Asia
Earlier in December, Live Bitcoin News reported that NASDAQ has confirmed its plans to launch Bitcoin futures in 2019. While the company’s timeline is yet to be revealed, a Roger Ver-backed cryptocurrency exchange CoinFLEX is taking the initiative.
Coin Futures and Lending Exchange (CoinFLEX) is a venture owned by a consortium which includes Roger Ver and Trading Technologies International Inc. The exchange is a former unit of UK Bitcoin exchange Coinfloor.
The new business based in Hong Kong will be headed by Mark Lamb – co-founder of Coinfloor. He assumes the position of a CEO. According to Bloomberg, the exchange will offer futures contracts for Ethereum, Bitcoin, and Bitcoin Cash which could be leveraged up to 20 times.
Going Against the Big Guys
One of CoinFLEX’s main competitors, also based in Hong Kong, will be BitMEX. It’s one of the largest cryptocurrency trading platforms and it’s founded by Arthur Hayes formerly from Citigroup Inc. The exchange offers higher leverage of up to 100 times on certain contracts.
However, the biggest difference which could play in CoinFLEX’s favor is that the futures traded on the platform will be physically-delivered.
This suggests that as soon as the contracts expire, the owner of the contract will receive the underlying asset instead of a payment in cash.
Speaking on the matter, Mark Lamb noted:
Crypto derivatives could become an order of magnitude larger than spot markets and the main thing that’s holding back that growth is the lack of physical delivery. […] Volumes are reduced because of a problem of trust when it comes to cash-settled trades.
In this regard, though, CoinFLEX will be competing with ICE’s Bakkt, which recently raised $182.5 million and is also set to offer physically-delivered Bitcoin futures contracts.
What do you think of CoinFLEX’s intentions to offer Physical Bitcoin Futures contracts? Don’t hesitate to let us know in the comments below!
Images courtesy of Shutterstock.