Wednesday, March 21, 2018

UK exchange to initiate their own cryptocurrency futures contract that will not just provide cash settlement, but also deliver cryptocurrencies

When the CME opened up a Bitcoin futures contract back in December of last year, the one interesting caveat within it was that there would be no actual delivery of  the cryptocurrency.  In fact all contracts would be cash settled, meaning the contract acts simply as a paper trade versus a normal contract for a commodity that would allow for delivery of physical goods.

However there may soon be a cryptocurrency futures contract arriving that will provide investors access to the cryptos upon demand as a company in the UK is preparing to initiate a futures contract that will provide settlement through cryptocurrency delivery.

Coinfloor, a London-based group of cryptocurrency exchanges for institutional and sophisticated investors and traders, plans to launch a futures exchange for digital assets that will include the first physically delivered bitcoin futures contracts. 
The new exchange, CoinfloorEX, will allow miners, hedge funds, traders and sophisticated investors to unlock the financial potential of bitcoin at scale, through specifically designed cryptocurrency contracts and operational controls, supported by institutional grade risk management and governance, Coinifloor announced in a press release. 
By offering the first physically delivered cryptocurrency futures contracts, CoinfloorEX was designed to protect investors and traders against price slippage on positions at the time of settlement, as well as concerns of market manipulation. 
The settlement is based on physical delivery rather than an index price from across other exchanges, providing greater pricing transparency. 
Access to Coinfloor’s spot exchange will allow investors to convert bitcoin to fiat currency post-physical delivery, providing opportunities for longer-term currency appreciation or through meeting bitcoin-denominated obligations. 
The exchange is secured by 100% multi-signature cold storage, protecting client portfolios from theft, loss or other security issues associated with partially online or online only storage. - CCN

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