LCH SA receives regulatory approval to clear Bitcoin index derivatives

Report date
  • LCH SA will provide clearing services through its new LCH DigitalAssetClear service for cash-settled Bitcoin index futures and options contracts traded on the UK-based digital asset derivatives trading venue, GFO-X.
  • LCH DigitalAssetClear service will provide market participants with access to clearing of crypto derivatives in a regulated environment.
  • Demonstrates LCH SA’s commitment to bringing the benefits of clearing to this growing asset class and expanding its services as a truly international clearing house.

LCH SA today announces it has duly received the required regulatory approval from the French national competent authorities (ACPR,  Banque de France and AMF) and European supervisory authorities (EMIR College, ESMA) to clear cash-settled Bitcoin index futures and options contracts. LCH SA will provide clearing services through its new dedicated service, LCH DigitalAssetClear, for these contracts traded on the UK FCA regulated digital asset derivatives trading venue, GFO-X. The offering has been developed by LCH SA and GFO-X in close consultation with market participants to ensure their digital asset derivatives are traded and cleared through a service that is secure, highly regulated and focused on digital asset derivatives. LCH DigitalAssetClear is underpinned by a segregated default fund, tailored risk management model and dedicated set of clearing rules. LCH SA continues to engage with General Clearing Members and plans to launch the clearing service later in 2024.

Commenting on the regulatory approval and the anticipated launch, Corentine Poilvet-Clédière, CEO, LCH SA, said: ‘We are pleased to have received regulatory approval to launch this innovative service which will enable institutional market participants to trade and clear cash-settled Bitcoin index futures and options within a regulated environment they are familiar with and which will allow them to benefit from LCH SA’s proven risk management capabilities. LCH SA is excited to be working with GFO-X, together with the industry, to provide a regulated marketplace for this asset class as we look to expand our services as a truly international clearing house.’

The new cash-settled Bitcoin index futures and options contracts will be cleared through LCH DigitalAssetClear and will be based on the GFO-X/Coin Metrics Single Asset Real-Time Bitcoin Index (GFOXBR), which is an EUBenchmark Regulation -compliant reference rate of the U.S. dollar price of Bitcoin. Firms will be able to trade futures and options on the Bitcoin reference index directly.

LCH DigitalAssetClear will operate a fully segregated clearing service – including a segregated default fund and a dedicated set of clearing rules – for market participants clearing these instruments. By using LCH DigitalAssetClear, members and clients will benefit from LCH SA’s innovative approach to enabling clearing of this asset class, in addition to its leading risk mitigation, settlement, netting and margin efficiencies, all within a regulated environment.

For further information
Harriet Leatherbarrow / Nandeep Roopray
Tel: +44 (0)20 7797 1222

About us
LCH. The Markets’ Partner.

LCH builds strong relationships with commodity, credit, equity, fixed income, foreign exchange (FX) and rates market participants to help drive superior performance and deliver best-in-class risk management. 

As a member or client, partnering with us helps you increase capital and operational efficiency, while adhering to an expanding and complex set of cross-border regulations, thanks to our experience and expertise.

Working closely with our stakeholders, we have helped the market transition to central clearing and continue to introduce innovative enhancements. Choose from a variety of solutions such as compression, sponsored clearing, credit index options clearing, contracts for differences clearing and LCH SwapAgent for managing uncleared swaps. Our focus on innovation and our uncompromising commitment to service delivery make LCH, an LSEG business, the natural choice of the world’s leading market participants globally.