London Stock Exchange Unit to Clear Bitcoin Index Futures, Options

LCH, the clearinghouse arm of the London Stock Exchange Group, will offer clearing services for cash-settled Bitcoin (BTC) index futures and options, the company said in a statement Thursday.

The separate service LCH DigitalAssetClear, part of the company’s French arm, will finalize trades made on GFO-X, a UK-regulated digital asset exchange, LCH said.

“Bitcoin index futures and options are a rapidly growing asset class,” Frank Soussan, Head of LCH DigitalAssetClear, said in a statement, citing “increasing interest among institutional market participants looking for access within a regulated environment they are familiar with.”

Clearinghouses offer a centralized venue in which to finalize trades that are agreed on an exchange. Since the 2008 financial crisis, they have been favored by regulators as a way to lessen the risk of separate bilateral deals among players such as investment banks.

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The move represents the latest foray by traditional finance players into the crypto market. In March, the Stuttgart stock exchange secured a crypto custody license from German regulator BaFin, and Brussels-based clearinghouse Euroclear has said it will soon be ready to launch a bond settlement platform based on crypto-style distributed ledger technology.

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Edited by Stephen Alpher.

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