Switzerland-based retail foreign exchange broker Dukascopy Bank has expanded its range of cryptocurrency investment products. The bank will now offer CFDs for Ethereum, the world’s second largest cryptocurrency by market cap, for all self-trading accounts.
Geneva’s Dukascopy Bank first introduced crypto products earlier this year, generating positive headlines across the crypto community. Ethereum CFD testing began several months ago after the bank received positive feedback from its bitcoin CFD product.
A contract for difference, or CFD, is a popular type of derivative that lets you speculate on the rising or falling prices of an asset – in this case, the price of Ether (ETH) over the US Dollar. The benefits of CFD trading include the ability to trade on margin or go short. In certain jurisdictions, trading also comes with unique tax benefits.
Moving forward, Dukascopy Bank will offer a maximum leverage of 1:3 for ETH/USD CFDs. Under new EU regulations, leverage higher than 1:2 is not permitted. However, Dukascopy Bank is able to offer 1:3 leverage for its ETH/USD CFDs because the main branch of the bank is located in Switzerland, outside of EU regulations. However, Dukascopy Bank’s European subsidiary, Dukascopy Europe, will need to comply with the new rules and will offer ETH/USD CFDs at 1:2 leverage.
The bank’s ETH/USD CFDs are expected to work similarly to other CFDs offered by the platform. Dukascopy will apply its overnight rollover policy to crypto CFD clients, for example, and the bank will apply different rollover rates to ensure a higher trading turnover, leading to better overnight conditions for clients.
Dukascopy Bank is Launching a Dedicated Crypto Gateway
In addition to the Ethereum CFD news, Dukascopy Bank has also shared its plans to launch a dedicated crypto gateway.
Clients will be able to withdraw and deposit funds in digital currencies on or from their Dukascopy accounts. Clients will also enjoy free internal crypto-transfers between mobile banking users.
Earlier this year, Dukascopy also attracted attention from across the institutional investing space when it announced plans to allow crypto-related companies to open business accounts. While mainstream Swiss banks have largely distanced themselves from crypto companies, Dukascopy has showed growing acceptance towards crypto.
Overall, Switzerland’s Dukascopy Bank is seen as one of the more crypto-friendly financial institutions in the space. Prior to launching crypto products, the bank operated as a foreign exchange and brokerage firm.
Moving forward, the bank will continue focusing on crypto. Dukascopy Bank recently filed for approval of its ICO plans with the Swiss Financial Market Supervisory Authority (FINMA), for example. Dukascopy plans to launch two coins of its own, including:
Dukascoins will be used as a crypto means of payment and will have a limited supply. Dukasnotes, meanwhile, will function as stablecoins.
Dukascopy Bank has already tested its ETH/USD CFDs over the past few months. ETH/USD CFDs are now available on all Dukascopy Bank self-trading accounts.