The US subsidiary of the cryptocurrency exchange FTX has announced that it has entered into a takeover deal for the digital currency futures and options exchange LedgerX. to work
FTX.US, a subsidiary of Hong Kong-based crypto derivatives exchange FTX, has acquired Ledger Holdings. The latter is the parent company of LedgerX – the popular US-based platform for trading digital asset derivatives. FTX US made the announcement yesterday as it seeks to diversify into the derivatives sector.
LedgerX acts as a designated contract market, swap execution facility and clearinghouse. It is the first licensed derivatives platform for digital assets in the United States and is regulated by the Commodity Futures Trading Commission (CFTC). The platform has reportedly cleared over 10 million crypto options and swap contracts in the four years of its existence.
The deal could reportedly close in October 2021 for an undisclosed amount. However, further financial details for the takeover are still pending. The deal looks like potentially big business for FTX and, if successfully signed, will allow FTX.US to add futures and options to its listing in the US.
LedgerX does not have a wide range of products with its primary focus on futures contracts, options and swaps on Bitcoin and Ethereum. With the completion of the deal, FTX.US will be better positioned to compete against other US exchange platforms, including NASDAQ-listed Coinbase and Gemini.
In relation to the acquisition, said FTX.US CEO Brett Harrison, “This acquisition is an important milestone for our rapidly growing US business and an important part of our strategy to bring regulated crypto derivatives to our US user base. We believe that integrating our technological capabilities, product portfolio and large footprint with LedgerX will enhance our ability to bring innovative products to all US cryptocurrency traders. “
Harrison described the deal as ideal and stated that it was within the exchange [FTX] Wheelhouse. The newly established unit with both sides will serve both private and institutional customers. He claimed that the plan is to continue LedgerX’s existing businesses while FTX.US works on the most appropriate way to take over LedgerX’s regulated futures and options offerings.
The exchange will also try to ensure that the good relationship with the regulators remains intact, as mentioned in the press release. To that end, it will devote a large part of its resources to maintaining good relationships with regulators in the United States, particularly the CFTC.