Competitors of crypto exchange FTX have opposed a proposal to allow individual investors to use derivatives to bet on bitcoin.
Cryptocurrency exchange FTX intends to seek approval from the U.S. Commodity Futures Trading Commission (CFTC) to allow individual investors to use derivatives to place leveraged bitcoin (BTC) bets. Regulators are currently reviewing the exchange’s application and may make a decision later this year.
If approved, investors will be able to deal directly with the crypto exchange, and not through a broker, which can significantly change the infrastructure of the derivatives markets.
FTX’s proposal was met with hostility by competitors and Wall Street companies. During a congressional hearing in May, Terrence Duffy, CEO of the Chicago Mercantile Exchange (CME), said “the move would create market risk.” CME offers a bitcoin-derived product that aims to compete with FTX offerings.
Better Markets Co-Founder, President and CEO Dennis Kelleher announcedthat at the time of the assessment, the CFTC should ensure “protection of clients and market participants – and limiting, if not reducing, systemic risks.”
However, an FTX spokesman said the company is confident that investors must have access to data, educational tools and a range of financial products to make the best decisions for themselves.
Earlier, FTX CEO Sam Bankman-Fried denied widespread rumors that the crypto exchange plans to absorb mining companies.
Source: Bits
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