VanEck and NASDAQ Partner to Create “Crypto 2.0 Futures-Type Contract” for the Bitcoin Market

CoinDesk’s Consensus: Invest conference hit the industry with a lot of big transitions and predictions from some of the most widely known names in cryptocurrency and traditional finance. However, when these two industries meet, something exciting is bound to come from it. Such is the case in a new collaboration between Nasdaq and VanEck, who will “bring a regulated crypto 2.0 futures-type contract.”

@Nasdaq and VanEck’s @MVISIndices announces #index #partnership and intention to bring to market transparent, regulated and surveilled #DigitalAssets products, such as #Bitcoin futures contracts. More info to come. Share & follow us. #crypto #futures #SMARTS #ConsensusInvest pic.twitter.com/Q2oCZx4pp1

— Gabor Gurbacs (@gaborgurbacs) November 27, 2018

These plans were announced by VanEck’s director of digital asset strategy, Gabor Gurbacs, who also said that the launch of this contract should be the beginning of 2019, though it is just the first of many. He added, “What I’d like to point out is we ran a few extra miles working with the [Commodity Futures Trading Commission] to bring about new standards for custody and surveillance.”

After making the annoucement, he spoke in a follow-up interview to say that the new products will be like an “upgrade” to current regulatory standards around similar products. With the use of the stock markets surveillance system from Nasdaq, also known as SMARTS, Gurbacs says that the goal of the partnership is to “inspire confidence with regulators and institutions trying to get involved [in the crypto markets].”

SMARTS enable the new project to watch out for suspicious market activity, ensuring that the trading under the bitcoin futures contract will be “in a fair and orderly fashion.” So far, there have been two bitcoin futures products approved by the Commodity Futures Trading Commission (CFTC) – one that is the combined effort of CBOE and Gemini, and one that is run by a partnership between CME and Crypto Facilities.

Settlement of accounts is handled entirely through cash, which means they are not “physically” settled. However, the planned launch of the bitcoin futures products next year from Bakkt will be physically settled, making Bitcoin the method of payment when the contracts expire. Gurbacs didn’t say which of these types of settlements would be used for the Nasdaq/VanEck product, and there’s been no information offered on the topic from Nasdaq representatives directly. However, he did say that 2019 will come with “lots to look forward to.”

Gurbacs is excited for 2019, going as far as to predict, “We believe that 2018 was the year of regulation and 2019 will be the year of implementation.”