There are many interesting projects in the world of Bitcoin and cryptocurrency. One of those projects is LedgerX, which is an institutional trading and clearing platform. The company has been seeking regulatory approval for some time now and officially received it from the SEC last week. Let’s take a look at what the company has to offer and how their approval will affect the global appeal of Bitcoin.
A Closer Look at What LedgerX has to Offer
Positioning itself as an institutional trading and clearing platform, LedgerX wants to bridge the gap between cryptocurrency and traditional finance. That is a lot easier said than done and the company will need to obtain regulatory approval first. Luckily for them, LedgerX has received regulatory approval to act as a Bitcoin swap exchange. It is a positive development, but LedgerX has bigger goals in mind.
To put this into perspective, we have to look closer at what LedgerX aims to bring to the table. While the company is focusing on financial, regulatory, and legal work, engineering will be their first priority. Even the LedgerX CEO is still actively coding the platform and project. That is different to what we see with most projects, cryptocurrency related or otherwise. Most firms outsource the coding to others, rather than the CEO doing the legwork.
Creating the future of finance will not be easy. In fact, the LedgerX team feels it will be an engineering-first problem. There will be no major change brought to finance without a proper platform and technology to enforce that change. Blockchain technology can certainly help bring about that change, but a holistic solution still needs to be developed. If LedgerX cannot even show off their project before seeking regulatory approval, their chance is receiving approval will dwindle spectacularly.
Assuming LedgerX can receive full regulatory approval, the team is hopeful they can become the world’s first platform to trade and clear options on Bitcoin. This will heavily hinge on how the CFTC views this project. The swap execution facility part is already taken care of, but there is no regulatory approval for running a derivatives clearing organization. Assuming the CFTC will grant the company that status, things will get very interesting.
Having a federally regulated Bitcoin options exchange and clearing house will open new doors and lead to exciting opportunities. In fact, LedgerX would provide fully-collateralized, physically-settled Bitcoin options for the traditional market. It may not sound as major as an official Bitcoin ETF, but the impact of the services provided by LedgerX could lead to similar results. Exposing institutional investors to Bitcoin through traditional vehicles will -probably- have a positive effect on the Bitcoin
All things considered, services such as LedgerX will have a positive impact on the financial sector, as well as Bitcoin. We can only hope they receive full regulatory approval. With the CFTC approving their request to launch a Bitcoin swap exchange, things are certainly heading in the right direction. A fully regulated Bitcoin clearing house and options exchange would certainly shake things up.