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The Hong-Kong-based cryptocurrency exchange Coin Futures and Lending Exchange (CoinFLEX) recently announced that they would be providing futures contracts for cryptocurrencies to Asian investors as early as February of this year.
CoinFLEX was launched back last year in February as CoinfloorEX which is a division of Coinfloor, which is the oldest British Bitcoin exchange. However, this venture has just announced that it is breaking away from the parent company.
This new platform is co-owned by parent company CoinFloor as well as well-known industry investors such as the likes of Bitcoin Cash’s Roger Ver, B2C2, Dragonfly Capital, Mike Komaransky, Trading Technologies and many others.
New Futures Contracts On The Horizon:
CoinFLEX has set the wheels in motion to initiate new futures contracts for Bitcoin (BTC), Ethereum (ETH) and Bitcoin Cash (BCH) with a leverage possibility of up to as many as 20 times.
Physically delivered futures contracts such as the ones currently offered by CoinFLEX are highly advantageous since their values are tied to an underlying asset. As we know, this means, that upon expiration of the futures contract, investors will be offered the asset instead of that of a fiat payout. CoinFLEX’s advantage of their preferred compensation system is the fact that it encourages transparency as manipulating the process is impossible.
Ultimately this transparency is a definite way to encourage more confidence in the crypto market which as we know, still suffers from pains in regulatory uncertainties.
CoinFLEX CEO Mark Lamb in an interview with Bloomberg had this to say:
“Crypto derivatives could become an order of magnitude larger than spot markets and the main thing that’s holding back that growth is the lack of physical delivery. Volumes are reduced because of a problem of trust when it comes to cash-settled trades.”
Lamb went on to add that currently, the trading volume in the market sits at $3 million with much more room for growth.
Futures Contracts Is A Growing Sector:
Along with CoinFLEX’s upcoming offer, they join the likes of Bakkt, a Chicago-based crypto exchange with is backed by Intercontinental Exchange, which is the parent company of the NYSE. Last year, Bakkt announced that they would be launching their own physically-backed futures contracts for investors based in the USA.
Bakkt managed to raise a whopping $182.5 million on New Year’s Eve from a consortium of high-profile investors as they edge closer to the launch of their Bitcoins futures market, this the first quarter of 2019.
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