FTX.US, the US arm of crypto derivatives exchange FTX, has completed the acquisition of Ledger Holdings Inc., parent company of a CFTC-regulated digital currency futures and options exchange.
According to a press release on Tuesday, Ledger was rebranded as FTX US Derivatives. However, both firms confirmed that that the acquisition and rebranding will have no effect on LedgerX’s daily operations.
Thanks to its regulatory status, FTX US Derivatives will provide FTX.US’s institutional and retail investors with options and futures contracts on Bitcoin and Ethereum. Since its inception in 2017, LedgerX has cleared over 10 million crypto derivatives contracts alongside pioneering the mini contracts that enable granular trading.
Commenting on the news, Breet Harrison, president of FTX US, said: “The completion of this acquisition is just the first step of many to provide the FTX US user base with access to the best products on the market. It should also be seen as a pivotal moment for FTX US as we continue to execute on our strategy to bring regulated crypto derivatives to our US user base”
Harrison added that the integration of the two platforms provides FTX with a technological advantage, and also strengthens their interactions with the US regulators.
Under the CFTC’s approvals, LedgerX operates as a Designated Contract Market (DCM), Swap Execution Facility (SEF), and a Derivatives Clearing Organization (DCO). The blockchain firm offers derivatives products to both institutional and retail investors, primarily physically-settled options and swaps contracts.
As a registered DCO, LedgerX is authorized to provide its suite of clearing services with respect to swaps, futures and options on futures contracts traded on a designated contract market. More specifically, its Bitcoin options platform is not required to undertake monthly stress tests of its financial resources to ensure that it could withstand the default of its largest participant.
“As the regulatory environment in the crypto ecosystem continues to evolve, we look forward to acting as a resource and an example of how the protections afforded by proper regulatory oversight and licensing can boost consumer confidence and facilitate safe and reliable exchange platforms,” said Zach Dexter, chief executive of FTX US Derivatives.
FTX, the cryptocurrency exchange founded by Sam Bankman-Fried, was recently valued at $25 billion after a $450 million funding round.
The exchange, which launched in 2019, also raised in July $900 million in a Series B fundraise, which was the largest ever for a crypto exchange. Since then, the company says it has grown its user base by nearly 50 percent while its average trade volume increased 75 percent, now averaging $14 billion per day.