CFTC Approves Cboe Clear Digital for Margined Crypto Futures

2 mins
Updated by Kyle Baird
Join our Trading Community on Telegram

In Brief

  • The Cboe will offer margined crypto futures.
  • Cboe Digital already offers crypto spot trading.
  • It appears only institutions are welcome to crypto trading in the U.S.
  • promo

The U.S. Commodities Futures Trading Commission has quietly approved an institutional crypto derivatives platform for margined futures.

On June 5, the CFTC announced that it had approved an amended order of registration for Cboe Clear Digital LLC.

The firm, also known as Cboe Clear, has been granted permission to “clear additional products,” it stated. Furthermore, the derivatives clearing organization (DCO) must act in compliance with the Commodity Exchange Act.

Cboe Crypto Futures Are a Go

Those “additional products” are margined crypto futures, according to the announcement.

“The amended order permits Cboe Clear to provide clearing services for digital asset futures on a margined basis for futures commission merchants, in addition to the fully collateralized futures and fully collateralized swaps previously authorized.”

Margined crypto futures contracts allow institutional traders to trade crypto futures while putting less collateralized capital upfront.

Additionally, trades are executed and cleared through an approved set of member futures commission merchants. The Chicago Board Options Exchange clearinghouse will act as a central counterparty to reduce default risks.

John Palmer, president of Cboe Digital, said:

“Derivatives are a time-tested and valuable tool that enable investors to gain market exposure and manage their risk,”

The Cboe is among many that have filed applications for crypto spot exchange-traded funds (ETFs). The SEC has rejected all spot ETF applications to date.

Only Institutions Welcome in Crypto?

The approval comes at a time when scrutiny of the crypto industry in the U.S. is at peak levels. It could be a message that only wealthy institutional investors are welcome. Regulators are trying hard to crush anything that retail traders have access to, Binance being the latest.

Read more on crypto futures and derivatives:
What are Perpetual Futures Contracts in Cryptocurrency?

Van Eck strategy advisor Gabor Gurbacs also noted the institutional angle, commenting:

“While everyone is caught up in the Binance SEC case institutions entered the chat, without people noticing,”

Gurbacs worked with the OCC (Office of the Comptroller of the Currency) on getting approval for a margined model. “The CFTC was waiting to see how the CME contracts end up functioning,” he said.

“Obviously they are working well so looks like approvals are back on the table.”

The NYDFS-licensed Cboe Digital combines both spot and futures markets into a single platform. Its spot trading market currently offers trading in Bitcoin, Bitcoin Cash, Ethereum, Litecoin, and USDC, according to a June 4 blog post.

Additionally, its futures exchange is preparing to launch physically delivered and cash-settled contracts for both BTC and ETH.

Top crypto projects in the US | July 2024
Harambe AI Harambe AI Explore
Uphold Uphold Explore
Coinbase Coinbase Explore
Chain GPT Chain GPT Explore
Top crypto projects in the US | July 2024
Harambe AI Harambe AI Explore
Uphold Uphold Explore
Coinbase Coinbase Explore
Chain GPT Chain GPT Explore
Top crypto projects in the US | July 2024



In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

Martin Young
Martin Young is a seasoned cryptocurrency journalist and editor with over 7 years of experience covering the latest news and trends in the digital asset space. He is passionate about making complex blockchain, fintech, and macroeconomics concepts understandable for mainstream audiences.   Martin has been featured in top finance, technology, and crypto publications including BeInCrypto, CoinTelegraph, NewsBTC, FX Empire, and Asia Times. His articles provide an in-depth analysis of...