LCH SA announced today that it has duly received the required regulatory approval from the French National Competent Authorities (ACPR, Banque de France and AMF) and European Supervisory Authorities (EMIR College, ESMA) for the clearing of Bitcoin index futures and rights contracts option.
LCH SA will provide clearing services through its new dedicated service, LCH DigitalAssetClear, for these contracts traded on the FCA-regulated UK digital asset derivatives trading venue, GFO-X. The offering was developed by LCH SA and GFO-X in close consultation with market participants to ensure that their digital asset derivatives are traded and cleared through a service that is secure, highly regulated and focused on digital asset derivatives .
LCH DigitalAssetClear is supported by a segregated fund, a tailored risk management model and a dedicated set of clearing rules. LCH SA continues to work with the General Clearing Members and plans to launch the clearing service later in 2024.
Corentine Poilvet-Clédière, CEO, LCH SA, said:
“We are pleased to receive regulatory approval for the launch of this innovative service that will allow institutional market participants to trade and clear cash-settled Bitcoin index futures in a regulated environment with which they are familiar and which will enable them to benefit from LCH SA’s proven risk management capabilities. LCH SA is excited to be working with GFO-X, along with the industry, to provide a regulated market for this asset class as we look to expand our services as a truly international clearinghouse.”
The new cash-settled Bitcoin index futures and options will be cleared through LCH DigitalAssetClear and will be based on the GFO-X/Coin Metrics Single Asset Real-Time Bitcoin Index (GFOXBR), which is a benchmark compatible with the EUBenchmark regulation the price of Bitcoin in US dollars. Firms will be able to trade futures and options on the Bitcoin benchmark directly.
LCH DigitalAssetClear will operate a fully segregated clearing service – including a segregated default fund and a dedicated set of clearing rules – for market participants clearing these instruments. By using LCH DigitalAssetClear, members and clients will benefit from LCH SA’s innovative approach to facilitating the clearing of this asset class, in addition to leading risk mitigation, settlement, netting and margin returns, all within one regulated environment.