CFTC Regulated Bitcoin Savings Accounts Launched By LedgerXbr>
Cryptocurrency asset management platform LedgerX has launched LedgerSavings, a new bitcoin savings account that is licensed by the US Commodities Future Trading Commission (CFTC).
LedgerX, backed by Miami International Holdings, is an institutional trading and clearing platform for bitcoin options. It received approval for its platform from the CFTC in July 2017. The license authorizes LedgerX to provide clearing services for fully collateralized digital currency swaps.
Juthica Chou, Chief Operating Officer at LedgerX, said the bitcoin savings product is certified by a CFTC derivatives clearing organization (DCO) license and a swap execution facility (SEF) license.
“Everything we do requires both the licenses,” said Chou. “And a lot of that is intentional, because by making it a package deal we can offer a number of services to our customers in a really clear, vertically integrated way.”
LedgerSavings is aimed at serving bitcoin investors who want to buy and hold. The goal is to provide investors with a fiat-based yield on their bitcoin holdings. This is done through a simplified version of a call overwrite, a trading strategy through which an investor deposits bitcoin on the platform and then sells a call option at a longer date with a higher strike call.
LedgerSavings’ interface allows users to choose the implied rate they’re anticipating to earn and the number of BTC they wish to earn the yield on. The options contracts will initially be offered for transactions over a three-month duration and a six-month duration, and LedgerX is charging a transaction fee for each service.
“This interface will definitely be skewed to the long bitcoin holders, who will likely only deposit bitcoin and who will want to earn interest off of that bitcoin,” Chou said.