ErisX has followed in the steps of LedgerX and been granted a license from the CFTC to settle Bitcoin futures in the cryptocurrency, further paving the way for the much-anticipated Bakkt platform to receive the same. ErisX, backed by U.S. brokerage giant TD Ameritrade, has obtained a derivatives clearing organization (DCO) license, which it has gained in addition to its existing designated contract market (DCM) license. The twin approvals mean the company can now launch crypto futures products under the watch of the U.S. regulator.
Our DCO license is the next step in ErisX’s evolution & mission to improve the digital asset space. We worked collaboratively w the CFTC to establish a clearinghouse guided by proven regulatory frameworks that protect participants and market integrity. https://t.co/xHN4giM5lr
— ErisX_Digital (@ErisX_Digital) July 1, 2019
Green Light Allows for Platform Building
Thomas Chippas, Chief Executive Officer of ErisX, welcomed the awarding of the license and the bigger impact it could have on the cryptocurrency space:
ErisX is unique in that for our digital asset market, we have divided the trading and settlement functions using traditional DCM (exchange) and DCO (clearing) models. This reflects the structure that institutional investors expect from other asset classes and will help drive these markets toward greater relevance and accessibility.
As with LedgerX, no timeline has been given for the launch of the platform, with the awarding of the license from the CFTC acting as more of a starting pistol than a checkered flag, allowing them to put more money and resources toward the platform now they know they have the green light.
All Eyes on Bakkt
While news of LedgerX and now ErisX getting CFTC clearance is clearly good news, Bakkt is the one everyone is waiting for. The months-delayed ICE-backed platform has stated indirectly that the CFTC is behind the delay, although late-July has been penciled in for the testing phase. Bakkt’s Chief Operating Officer Adam White recently told a Fortune finance panel that the process “is not easy or fast” and that doing things correctly was preferable to doing them quickly. Given that we’re approaching a year since the plan was first announced, it’s clear that this is most certainly happening.