FTX US Derivatives (Formerly LedgerX) Definition

What Was FTX US Derivatives (Previously LedgerX)?

FTX US Derivatives (previously LedgerX) was a digital foreign money futures and choices trade and clearinghouse. It was regulated by the Commodity Futures Buying and selling Fee (CFTC).

The trade provided bodily settlements of all contracts, block buying and selling, and algorithmic buying and selling alternatives for institutional buyers. It additionally allowed direct entry for all merchants.

Key Takeaways

  • FTX US Derivatives (previously LedgerX) was a regulated platform for buying and selling Bitcoin and Ether derivatives similar to futures, choices, and swaps.
  • FTX US Derivatives (previously LedgerX) acted as a clearinghouse for institutional buyers who negotiate cryptocurrency block trades instantly with each other.
  • In November 2022, FTX filed for chapter and its founder Sam Bankman-Fried stepped downs as CEO.

Understanding FTX US Derivatives (Previously LedgerX)

FTX US Derivatives (previously LedgerX) was the primary trade to supply cryptocurrency contracts within the U.S. Contracts for bitcoin, known as mini-contracts, offered in increments of 0.01 BTC; ether contracts are known as deci-contracts and offered in increments of 0.10 ETH. These fractional contracts enabled buyers to make granular trades and permit for scalability because the markets fluctuate.

FTX US Derivatives was registered with the CFTC as a Designated Contract Market, Derivatives Clearing Group, and a Swap Execution Facility.

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In October 2021, FTX US acquired LedgerX, which modified its identify to FTX US Derivatives. FTX US Derivatives gives cryptocurrency futures, choices, and swaps—all of which had been bodily delivered as an alternative of cash-settled.

In November 2022, FTX went bankrupt and its founder Sam Bankman-Fried stepped down as CEO.

The CFTC accepted LedgerX (now FTX US Derivatives) for futures buying and selling in September 2020.

Futures Buying and selling

Like a daily futures contract, the corporate’s cryptocurrency futures contracts allowed buyers to purchase or promote at a predetermined worth and time sooner or later. Contract sizes rely upon the cryptocurrency and transfer in $1 increments. FTX US Derivatives provided contracts for the present and following month and two quarterly settlements.

Swaps

The swap contracts from FTX US Derivatives gave buyers an affordable means to purchase or promote cryptocurrency. Swap contracts are priced at $0.05 everyAll futures and swap contracts had been totally collateralized. A service for institutional buyers allowed for the direct negotiation of block trades, with FTX US Derivatives performing because the clearinghouse.

What happend to FTX?

FTX filed for chapter in November 2022 and its founder Sam Bankman-Fried stepped down as CEO.

Does Sam Bankman-Fried face a lawsuit?

In November 2022, FTX founder Sam Bankman-Fried, Tom Brady, and different celebrities had been named in a class-action lawsuit on behalf of FTX token (FTT) purchasers.

Investing in cryptocurrencies and different Preliminary Coin Choices (“ICOs”) is very dangerous and speculative, and this text shouldn’t be a suggestion by Investopedia or the author to spend money on cryptocurrencies or different ICOs. Since every particular person’s state of affairs is exclusive, a certified skilled ought to all the time be consulted earlier than making any monetary choices. Investopedia makes no representations or warranties as to the accuracy or timeliness of the knowledge contained herein. As of the date this text was written, the creator doesn’t personal Bitcoin.