The Ethereum community and the entire digital currency industry could see another step forward soon. Chicago-based digital currency exchange firm, ErisX, rolled out its physically-settled ETH futures contracts, which avail real digital currencies to investors instead of fiat worth their value.
The latest launch of physically-settled ETH futures by ErisX, makes Ethereum the second digital currency to have a legally approved futures market after Bitcoin. Historic action indicates that regulators are becoming more and more warm with the second most capped digital currency after Bitcoin.
Physically-settled ETH futures rolled out a week after ErisX secures BitLicense
ErisX’s latest announcement comes just a week after the U.S.-based crypto exchange revealed that it had obtained a virtual currency license (BitLicense) from the state of New York. The Ethereum futures market of exchange falls under the hegemony of the CFTC.
Earlier in February, the Chairman of CFTC insinuated that the future of Ethereum is underway while emphasizing that ETH and BTC are products under the responsibility of the CFTC.
The physically-settled ETH futures by ErisX means that contracts are settled utilizing the basic asset. Ethereum is awarded to the trader, rather than the cash difference value between the asset and the market prices and the contract. ErisX utilizes a centrally administered order-book to govern the trading of futures contracts on its platform.
Futures contracts are regularly used by financial institutions and sole investors to insure the risk. For instance, an individual may decide to risk getting 20 ETH for $400 in half a year, although the price might rise higher at the time. Futures contracts help in market price determination and elevate the liquidity of the market.
ErisX new product available through American brokers
The Chicago-based crypto broker, ErisX, is backed by US brokerage firm, TD Ameritrade. The crypto exchange platform has secured two regulatory licenses: a derivatives clearing license and a designated contract market (DCM) license.
The three-year-old start-up has availed its products through US brokers licensed as futures commission merchants (FCMs). In fact, ErisX just joined TradeStation Crypto the other day, to extend the spread of attainable liquidity convenient to the latter’s clients.