The Commodity Futures Trading Commission (CFTC) recently approved a change to the ErisX clearinghouse license. The license change allows ErisX to offer more freely traded products.
“The significance of the revised order is that it broadens our licensing activities by allowing us to remove elements other than virtual currencies or cryptocurrencies,” said Lauris Crista, ErisX General Cointelegraph.
We can now list futures or swaps across a whole range of commodities, from new contracts related to cryptocurrencies such as retail futures or cryptocurrencies, to event contracts and other commodity contracts, including symbolic base metals, precious metals and diamonds. … ”
Christia explained that the ErisX brand includes an exchange that offers both spot and future transactions, and a clearing organization that also enables both immediate and future activities. “At the federal level, our exchange is licensed for a dedicated contract market (DCM), and our clearinghouse is licensed as a Derivative Clearing Organization (DCO),” he explained.
Unlike the cryptocurrency space, where exchanges wear multiple “caps”, regulation requires dividing traditional traditional economies into different wings of business. The exchange provides market availability while the clearinghouse deals with the assets and their final settlement.
Regulations require separate entities to trade in and eliminate derivatives. The same cannot be said of spot trading, although ErisX still uses this structure due to the benefits, which Cristia says includes greater asset protection.
Not only does the CFTC change provide the opportunity to clear goods in large markets, but it also gives ErisX an advantage. “Our data center platform, consisting of our TCS technology and the DCO license, includes many key features and functions that not all DCO administrators share,” said ErisX CEO Thomas Chippas in a public press release on Wednesday.
“We can eliminate cryptocurrency futures and swaps, as well as contracts for all other commodities. We look forward to more welcoming FCM, institutions, market makers, professional trading companies and individuals to take advantage of the expanding clearinghouse.”
The achievement also opens up the clearing organization ErisX to collaborate with other companies and organizations. “The IrisX platform for technology exchange, integrated clearing, licenses and operations enables the provision of services to third parties with innovative business ideas that require an infrastructure regulated for the market,” the statement said.
Regulation has become more and more important to the crypto industry in recent years, and compliance has become important.