TrueDigital to Start Margined, Physically-Delivered Bitcoin (BTC) Swap Contracts
TrueDigital: Looking to Make Their First Margined BTC (Physically-Delivered Bitcoin) Swaps
TrueDigital is currently a regulated derivatives marketplace dealing with all types of digital assets. trueDigital has derivatives contracts that have undergone the self-verification process run by its affiliate trueEX.
The self-verification process by trueEX is known as the SEF (swap execution facility) which is regulated by the CTFC. It is expected that these contracts will be listed on this exchange, and be subjected to swap execution facility rules. They will become subject to these rules after completing the 10-day self-certification duration.
It is expected that trueDigital will at first list contracts in the coming three months. Each contract will have a quarterly maturity date, with the settlements being made on the last Friday of the maturity month.
When it comes to the derivatives contracts, their physical delivery will involve the delivery of the asset in question once it has reached its maturity date. This is a deviation from the current methods in use, which involves settling the derivatives in cash. The current methods have been placed under a lot of scrutiny of late due to the fact that they are easily susceptible to price and market manipulations.
Nick Goodrich, trueDigital’s Director of Business Development, stated that they had received continued market feedback indicating that their organizational investors were interested in getting access to physically-delivered products. The reason for this being that these products were best placed to address the issues and challenges that arose from price manipulations.
Many institutional investors were of the opinion that the cash-settled derivatives in use at the moment were easily manipulated. The introduction of this new products will take after instruments that the investors are comfortable with. They will also be instrumental in creating a building block for the organizational digital assets markets.
The company was established in March this year. In July this year, it went on to launch its very-first maker-based BTC (bitcoin). This was in addition to launching numerous other indices for its institutional markets. To-date, there are close to ten markets that have already announced plans to make contributions.
Some of these markets that have agreed to contribute, or which plan to make contributions with time include Elwood, Genesis Global Trading, Altonomy, Circle, Hehmeyer, XBTO Group, and DV Chain.
Key Features of the TrueDigital Platform
TrueDigital is currently the only first compliant digital assets transfer platform in the world. It makes it possible for institutions to settle as well as rapidly transfer their assets from one location to the next. The platform is also the first transparent publisher of ETH and BTC OTC reference rates. These are rates that have been built using IOSCO principles.
Its platform features include:
- Asset tokenization
- Fully featured multi-asset exchange
- Novel products and indexes
- Enterprise infrastructure
- Near real-time settlement and margining
- Delivery solutions vs. distributed payments
TrueDigital believes that there is a big underserved market just lying below the surface. This is a market that comprises of retail investors, OTC traders, sovereign wealth funds, financial institutions, executing brokers, and HNW individuals.