- Cboe Digital to become first U.S. regulated crypto native exchange and clearinghouse to enable both spot and leveraged derivatives trading on a single platform
- 11 leading firms across crypto and traditional finance committed to supporting launch on Day 1
CHICAGO, Nov. 13, 2023 /PRNewswire/ — Cboe Digital today announced plans to launch trading and clearing in margin futures on Bitcoin and Ether, beginning January 11, 2024. With this launch, Cboe Digital will become the first U.S. regulated crypto native combined exchange and clearinghouse to enable both spot and leveraged derivatives trading on a single platform. Committed to bringing trust, transparency and responsible innovation to the crypto spot and derivatives markets, Cboe Digital presents an intermediary-inclusive model, ensures separation of duties to avoid conflicts of interest, and uses an integrated exchange-clearinghouse model that will allow it to potentially bring more unique and groundbreaking offerings in 2024.
Cboe Digital will initially offer financially settled margined contracts on Bitcoin and Ether and plans to expand its product suite to include physically delivered products at a later date, subject to regulatory approvals. The margin model is designed to allow customers to trade futures without posting the full collateral up front, thereby providing greater capital efficiency compared to trading futures on a non-margined basis. Significantly, Cboe Digital’s unified spot and derivatives trading platform will also help enable customers to easily access both markets, creating opportunities for additional capital and operational efficiencies.
Cboe Digital’s planned launch of margin futures will be supported by leading firms across the cryptocurrency and traditional financial marketplace, including B2C2, BlockFills, CQG, Cumberland DRW, Jump Trading Group, Marex, StoneX Financial, Talos, tastytrade, Trading Technologies and Wedbush.
“Our upcoming launch of margin futures represents a significant milestone for Cboe Digital, and we are grateful to have the support of such a remarkable group of industry partners who share our commitment to building trusted and transparent crypto markets,” said John Palmer, President of Cboe Digital. “Futures have long served as valuable hedging instruments in the traditional financial markets, and we couldn’t be more excited to extend access to this tool further into the digital assets markets and offer margined trading for our customers. We believe derivatives will foster additional liquidity and hedging opportunities in crypto and represent the next critical step in this market’s continued growth.”
“As a leading liquidity provider delivering deep and reliable pricing across market conditions, B2C2 supports efforts to enhance institutional adoption of cryptocurrencies,” said Nicola White, CEO of B2C2. “We are pleased to be working with high-quality exchanges such as Cboe Digital whose focus is on transparent markets and superior risk management resources.”
“Cboe Digital’s offer in providing secure access to regulated futures markets is key to maturing this nascent asset class and enabling broader institutional participation,” said Chris Zuehlke, Global Head of Cumberland DRW. “We are pleased to support and provide liquidity to Cboe’s markets.”
“We’ve been trading on Cboe markets for many years, and we welcome their new initiative. There is customer demand for these products, and Marex is keen to support its customers from the outset,” said Thomas Texier, Head of Clearing at Marex. “Cboe Digital’s margin futures launch will help bring competitive technology and innovative solutions to regulated markets.”
“Cboe Digital has been at the forefront of cryptocurrency innovation since its inception and is a trusted platform in the growing space,” said Vincent Angelico, Head of Clearing and Execution Services at StoneX Financial. “We look forward to working with Cboe Digital and building a secure and transparent marketplace for crypto spot and derivatives trading.”
“At tastytrade, we believe regulated derivatives play a valuable role for investors navigating any market, and who better to bring leveraged crypto derivatives to the forefront than Cboe Digital,” said JJ Kinahan, CEO of IG North America and President of tastytrade. “With their innovative products, well-governed markets and secure access, we look forward to working with Cboe Digital.”
“Cboe Digital has been instrumental in helping facilitate the creation of a transparent well-regulated crypto spot and derivatives market,” said Bob Fitzsimmons at Wedbush Securities. “We congratulate Cboe Digital on this exciting target and look forward to continued collaboration in this market.”
Cboe Digital’s planned launch of margin Bitcoin and Ether futures will complement its existing offering of Bitcoin, Bitcoin Cash, Ether, Litecoin and USDC trading on its spot crypto market. Contract margin requirements for the new futures will be published on Cboe Digital’s website daily, along with standardized portfolio analysis of risk (SPAN®) compatible risk parameter files that can be used to replicate margin calculations.
About Cboe Global Markets, Inc.
Cboe Global Markets (Cboe: CBOE), a leading provider of market infrastructure and tradable products, delivers cutting-edge trading, clearing and investment solutions to market participants around the world. The company is committed to operating a trusted, inclusive global marketplace, providing leading products, technology and data solutions that enable participants to define a sustainable financial future. Cboe provides trading solutions and products in multiple asset classes, including equities, derivatives, FX, and digital assets, across North America, Europe and Asia Pacific. To learn more, visit www.cboe.com.
About Cboe Digital
Cboe Digital offers individuals and institutions a single, innovative platform to access crypto spot and futures markets. By combining professional tools, advanced technology, sophisticated regulatory oversight, and a diverse product set, Cboe Digital offers compliant, capital markets friendly workflows to digital market participants. Backed by some of the world’s largest trading firms and financial institutions, Cboe Digital brings transparency and reliability to the digital asset class.
Cboe Digital Futures are offered through Cboe Digital Exchange, LLC, a CFTC registered DCM and Cboe Clear Digital, LLC, a CFTC registered DCO. The CFTC does not have regulatory oversight authority over certain virtual currency products including spot market trading of virtual currencies. Cboe Digital’s Spot Market is not licensed, approved or registered with the CFTC and transactions on the Cboe Digital Spot Market are not subject to CFTC rules, regulations or regulatory oversight. The Cboe Digital Spot Market may be subject to certain state licensing requirements and operates in NY pursuant to Cboe Clear Digital license (“BitLicense”) to engage in virtual currency business activity by the New York State Department of Financial Services. Cboe Digital and the Cboe Digital logo are trademarks of the Cboe Global Markets Group of companies. To learn more, visit www.cboedigital.com.
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Cboe® and Cboe Global Markets® are registered trademarks and Cboe Digital™ and Cboe ™Clear are service marks of Cboe Global Markets, Inc. and its subsidiaries. All other trademarks and service marks are the property of their respective owners.
Cboe Global Markets, Inc. and its affiliates do not recommend or make any representation as to possible benefits from any securities, futures, virtual currencies or investments, or third-party products or services. Cboe Global Markets, Inc. is not affiliated with BlockFills, CQG, Marex, StoneX, Talos Trading, Trading Technologies, and Wedbush.1 Investors should undertake their own due diligence regarding their securities, futures, virtual currencies and investment practices. This press release speaks only as of this date. Cboe disclaims any duty to update the information herein.
Nothing in this announcement should be considered a solicitation to buy or an offer to sell any futures or virtual currencies in any jurisdiction where the offer or solicitation would be unlawful under the laws of such jurisdiction. Nothing contained in this communication constitutes tax, legal or investment advice. Investors must consult their tax adviser or legal counsel for advice and information concerning their particular situation.
Cboe Global Markets, Inc. and its affiliates, to the maximum extent permitted by applicable law, make no warranty, expressed or implied, including, without limitation, any warranties as of merchantability, fitness for a particular purpose, accuracy, completeness or timeliness, the results to be obtained by recipients of the products and services described herein.
Cautionary Statements Regarding Forward-Looking Information
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve a number of risks and uncertainties. You can identify these statements by forward-looking words such as “may,” “might,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,” and the negative of these terms and other comparable terminology. All statements that reflect our expectations, assumptions or projections about the future other than statements of historical fact are forward-looking statements. These forward-looking statements, which are subject to known and unknown risks, uncertainties and assumptions about us, may include projections of our future financial performance based on our growth strategies and anticipated trends in our business. These statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from those expressed or implied by the forward-looking statements.
We operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible to predict all risks and uncertainties, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.
Some factors that could cause actual results to differ include: the loss of our right to exclusively list and trade certain index options and futures products; economic, political and market conditions; compliance with legal and regulatory obligations; price competition and consolidation in our industry; decreases in trading or clearing volumes, market data fees or a shift in the mix of products traded on our exchanges; legislative or regulatory changes or changes in tax regimes; our ability to protect our systems and communication networks from security vulnerabilities and breaches; our ability to attract and retain skilled management and other personnel, including compensation inflation; increasing competition by foreign and domestic entities; our dependence on and exposure to risk from third parties; global expansion of operations; factors that impact the quality and integrity of our indices; our ability to manage our growth and strategic acquisitions or alliances effectively; our ability to operate our business without violating the intellectual property rights of others and the costs associated with protecting our intellectual property rights; our ability to minimize the risks, including our credit, counterparty, investment, and default risks, associated with operating a European clearinghouse; our ability to accommodate trading and clearing volume and transaction traffic, including significant increases, without failure or degradation of performance of our systems; misconduct by those who use our markets or our products or for whom we clear transactions; challenges to our use of open source software code; our ability to meet our compliance obligations, including managing potential conflicts between our regulatory responsibilities and our for-profit status; our ability to maintain BIDS Trading as an independently managed and operated trading venue, separate from and not integrated with our registered national securities exchanges; damage to our reputation; the ability of our compliance and risk management methods to effectively monitor and manage our risks; restrictions imposed by our debt obligations and our ability to make payments on or refinance our debt obligations; our ability to maintain an investment grade credit rating; impairment of our goodwill, long-lived assets, investments or intangible assets; the impacts of pandemics; the accuracy of our estimates and expectations; litigation risks and other liabilities; and operating a digital asset business and clearinghouse, including the expected benefits of our Cboe Digital acquisition, cybercrime, changes in digital asset regulation, losses due to digital asset custody, and fluctuations in digital asset prices. More detailed information about factors that may affect our actual results to differ may be found in our filings with the SEC, including in our Annual Report on Form 10-K for the year ended December 31, 2022 and other filings made from time to time with the SEC.
We do not undertake, and we expressly disclaim, any duty to update any forward-looking statement whether as a result of new information, future events or otherwise, except as required by law. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof.
1 B2C2, DRW Cumberland, Robinhood, and tastytrade are minority investors in Cboe Digital.
SOURCE Cboe Global Markets, Inc.
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