The world’s first regulated ethereum futures will soon begin trading on UK cryptocurrency trading platform Crypto Facilities.
The London-based firm — which is regulated by the Financial Conduct Authority (FCA) — on Friday announced that it will list an ethereum futures contract, providing institutional investors with the ability to go long or short on the price of ether without the regulatory and custodial risks associated with trading the underlying asset. The contracts will begin trading at 4 pm UK time.
Crypto Facilities chief executive Timo Schlaefer said in a statement that he believes the presence of regulated futures will bring more liquidity to ethereum, which is already the world’s second largest cryptocurrency by market cap.
He said:
“Ether is the second most liquid cryptocurrency after Bitcoin, trading in the billions of dollars daily, and we are excited to be launching ETH futures. The Ethereum network is the pre-eminent blockchain for smart contracts, and we believe this new trading instrument will attract more investors and bring greater liquidity to the marketplace.”
Chicago-based trading firm Akuna Capital and London-based market maker B2C2 will provide liquidity for the ethereum futures product.
Toby Allen, head of digital assets at Akuna, said that the firm is “looking forward to seeing this much-needed product fill a gap in the market. The addition of a futures product enables crypto traders to take both long and short positions in ETH and is another giant leap in the development of the crypto asset class.”
Crypto Facilities already offers futures trading for bitcoin and Ripple’s XRP token, and its trading data is included in CME Group’s Bitcoin Reference Rate (BRR), which is used to calculate the pricing of the Chicago-based exchange’s bitcoin futures product.
Last week, researchers at the Federal Reserve released a report arguing that the launch of bitcoin futures on CME triggered a widespread cryptocurrency market decline because it provided bears with the opportunity to easily take up short positions on the nascent asset. However, most analysts believe that the presence of these financial products is likely bullish for the asset class over the long term.
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